Can Arbitrum’s recently formed DAO recover from its messy week?
Source:https://techcrunch.com/2023/04/06/to-dao-or-not-to-dao/ Can Arbitrum’s recently formed DAO recover from its messy week? 2023-04-06 21:55:19

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Welcome back to Chain Reaction.

This week was pretty bearable as a crypto reporter covering this space. There was less crazy news transpiring, compared to previous weeks (where we saw a number of U.S. government crackdowns on major crypto companies like Binance and Coinbase).

Still, it’s never a dull week in the crypto world.

In late March, Arbitrum, an Ethereum scaling solution, transitioned into a decentralized autonomous organization (DAO), after airdropping community members its new token, ARB. DAOs are meant to operate with no central authority and token holders can vote on decisions to govern the entity. Seems fair right? Well, sometimes it can get messy.

Exhibit A: Over the weekend, Arbitrum got in a bit of hot water after its foundation made a proposal to transfer 750 million ARB tokens, worth about $1 billion at the time, to its own wallets. Before the vote was over, the foundation, a centralized entity, already sent the majority of the tokens to itself — which backfired as voters in the community voted against the move.

In attempts to calm the waters, Arbitrum said it would hold redos for voters to decide — which brought in mixed reviews from community members. Some found the company’s decision positive and an attempt to listen to the community, while others still believed their move of tokens was an abuse of control over what was supposed to be a now decentralized group.

In response to it all, on Wednesday the Arbitrum Foundation proposed to expand ARB token holders’ budget oversight and governance powers, or voting powers. The foundation also said in a Discord post it “will not move” the 700 million ARB tokens that were transferred to its “Administrative Budget Wallet” until the community approved “an acceptable budget.” It also said it would propose new actions to make governance of the alleged-DAO “more accessible.”

Within those proposals, the foundation also plans to let the DAO vote on limiting the centralized entity’s powers and increasing community members’ control. Its DAO members will have time to provide feedback on the proposals and then the two proposals will be open for a week-long vote, according to “eli_defi,” an Arbitrum Foundation community lead on Discord. Whether all these initiatives pass is to be determined.

The ARB token is down 11% on the week.

In general, the whole cryptocurrency market was mostly unchanged on the week with the total crypto market cap down less than 1% to $1.177 trillion, according to CoinMarketCap data. At the time of writing, the two biggest cryptocurrencies by market cap — bitcoin and ether — were down about 2% and up 4%, respectively, within the same time frame.

This week in web3

The US is losing crypto talent as blockchain devs seek safer havens (TC+)

It’s usually third-world countries that frequently say they’re experiencing a “brain drain” — the bleeding of talent to other countries or parts of the world. But it seems now the United States is the one seeing talent fleeing to other parts of the world, at least as far as blockchain developers are concerned.

Hong Kong is charting its own web3 path despite China’s anti-crypto stance (TC+)

Hong Kong has an on-again-off-again relationship with crypto: Before China outlawed all crypto-related activities in 2021, the Asian financial hub was the early home to several crypto startups, including the now-defunct FTX, which left for the Bahamas after the ban. Now, Hong Kong is again welcoming crypto businesses, only this time with more regulatory clarity.

Investors unfazed by Q1 crypto funding decline (TC+)

Crypto-focused venture capital investors are trucking along in their work. Many remain confident in their investing strategies despite an enervated first-quarter market for crypto startup fundraising. Others are noticing a sharper decline in investing pace.

Blockchain builder Ava Labs partners with Korea’s SK Planet to expand Asia footprint

Ava Labs, a company that launched the layer-1 blockchain Avalanche, has partnered with SK Planet, a data management and marketing platform unit of South Korean company SK Square. SK Planet will launch Avalanche Subnet UPTN to offer web3 infrastructure in South Korea. The partnership comes less than a month after the New York-based digital asset firm hired its first new heads in Asia in service of accelerating its footprint in the region.

Twitter’s new homepage logo is very doge-y

Twitter’s homepage icon really is the doge meme right now. This might just be Musk’s idea of a belated April Fools’ joke, or it could mean something more than that. The price of the meme-driven cryptocurrency Dogecoin was up as a result, though it’s still far lower than its peak price in May 2021.

The latest pod

For this week’s episode, Jacquelyn interviewed Arianna Simpson, general partner at Andreessen Horowitz (commonly known as a16z).

Prior to joining the a16z family, Arianna founded Autonomous Partners, an investment fund focused on crypto. She also helped launch Crystal Towers Capital, which is an early-stage fund investing primarily in YC companies.

A16z has dug deep into the crypto space after launching four funds dedicated to the industry, with the most recent one being about $4.5 billion in May 2022. Some of its portfolio companies include big crypto players we’ve interviewed in the past like, Alchemy, Avalanche and Aptos.

We talked about Simpson’s background, how her strategy has changed over the years, what she looks for in founders and whether she would launch another VC firm in the future.

We also discussed:

  • The current investing climate
  • Web3 gaming space
  • Where founders are building
  • Regulatory landscape
  • Advice for founders

Subscribe to Chain Reaction on Apple Podcasts, Spotify or your favorite pod platform to keep up with the latest episodes, and please leave us a review if you like what you hear!

Follow the money

  1. Blockchain messaging protocol LayerZero raises $120 million, hitting $3 billion valuation
  2. Netherlands-based crypto exchange Finst raises $4.4 million
  3. Delphi Labs raised $13.5 million for its web3 accelerator
  4. Carbon-backed digital collectibles Ecosapiens raised $3.5M in a seed round
  5. Crypto derivative exchange Bitget raises $10 million from Dragonfly

This list was compiled with information from Messari as well as TechCrunch’s own reporting.

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Tech, Technology Source:https://techcrunch.com/2023/04/06/to-dao-or-not-to-dao/

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