ArbitrumDAO is voting on a proposal to add 100 million Arbitrum (ARB) tokens to Global Dollar (USDG) incentives and convert most expansion fees into the Paxos-issued stablecoin, shifting treasury income toward a dollar token.
Entropy Advisors submitted the proposal Oct. 6. The DeFi Renaissance Incentive Program began with an 80 million ARB budget and has about 65 million ARB left. Adding 100 million ARB would bring the available amount to roughly 165 million ARB and combine Seasons 2 through 4 into one period focused on USDG.
Season 2 is already underway. The proposed incentives would support USDG liquidity and teams that integrate the stablecoin. The DAO would commit another 100 million ARB, while Entropy expects some treasury allocations to earn less in the short term as they support USDG liquidity.
The Arbitrum Developer Guild would receive 20% of fees from the Arbitrum Expansion Program. The remainder, including fees already collected, would enter the treasury management portfolio. The Arbitrum Treasury Management Council would control decisions on converting those fees into USDG, with the Arbitrum Foundation carrying out the conversions. The council could also use portfolio assets to support USDG liquidity.
Entropy says expansion fees often arrive in volatile tokens even though the DAO faces dollar-denominated costs. It argues that participation in the Global Dollar Network could provide dollar-denominated rewards based on USDG that partners hold, mint and accept. USDG launched on Arbitrum One on Oct. 6, when Arbitrum said the network held about $4 billion in stablecoins. The proposal also cites an earlier 250 million ARB allocation for strategic partnerships.
On Oct. 7, the Arbitrum Foundation endorsed the plan. Governance participant cp0x said it voted against the proposal, arguing that delegates had not been given the network agreement’s terms, expected revenue or the intended recipient of rewards, and that performance targets had not been set. It also raised concerns about concentrating treasury assets in one issuer’s stablecoin.
Separately, the foundation announced a Stablecoin Growth Program on Oct. 15 that includes a 2 million ARB prize pool to encourage USDG use.
Delegates have until Oct. 22 to complete the off-chain vote. If it passes, an on-chain vote is planned for Oct. 29 through Nov. 12.
