Arbitrrum announced the launch of the on-chain governance token $ARB.
$ARB will play a vital role in the progressive decentralization of the Arbitrrum protocol.
Here's how it works:
Arbitrrum introduces a "chain owner" that manages changes to the system.
The "chain owner" can modify core parameters, suspend transactions, and update core contracts.
Upgrades are necessary for improvements, bug fixes, and Ethereum compatibility.
Here's the problem: "chain owners" introduce centralization.
L1 protocols like Ethereum are governed by community consensus, but L2 protocols like Arbitrrum are governed by L1 smart contracts.
This requires formal on-chain governance for the upgrade to take place.
Come learn about the $ARB governance token.
$ARB supports decentralized proposals and protocol upgrades.
The role of "chain owner" is given to the "Arbitrum DAO", consisting of $ARB token holders.
The DAO is governed by "provisions" that describe how the DAO operates.
The regulations are guided by 7 values:
• Consistent with Ethereum
• sustainable
•Safety
• Social and technical inclusion
• User-centric
• Neutral & Open
Arbitrum becomes the first layer-2 solution to "automate governance".
Governance happens entirely on-chain, eliminating the need for the core team to manually implement proposals .
In my opinion, this is the coolest part of a DAO. 😎
In an emergency, however, the Security Council could directly upgrade the protocol, skipping the delay.
They are bound by the Arbitrum DAO constitution to only use their powers in emergencies and issue transparency reports when necessary. Nine out of 12 approvals are required.
I thought this might spark some discussion shortly after the proposal was published.
Voting power is determined by the number of $ARB tokens held or represented by community members.
But token holders can delegate their voting power to others, making it easier for members to participate in governance without constantly reviewing proposals.
More importantly, $ARB will manage two "chains" of Arbitrum:
• Arbitrum One for DeFi/NFT
• Arbitrum Nova for gaming/social apps
Interestingly, Arbitrum DAO could authorize the creation of new L2 chains through constitutional governance proposals.
The second big announcement is Arbitrum Orbit .
Orbit is an L3 framework that provides massive scalability while preserving safety guarantees.
L3s deployment is permissionless, which means it does not require DAO permissions.
