Vote Buying Starts Governance Debate in Arbitrum DAO

The Arbitrum Foundation has launched a community discussion regarding vote buying in DAO governance, following an incident where a user paid 5 ETH (approximately $10,000) to influence the Oversight and Transparency Committee (OAT) election. Last weekend, a user named hitmonlee.eth purchased 19.3 million ARB votes (worth about $6.5 million) through LobbyFi and cast them for candidate CupOJoseph.

LobbyFi, active in ArbitrumDAO for several months, has previously facilitated smaller vote purchases. However, this marks the first case of someone paying a substantial amount to potentially sway an election outcome. Previous instances included approximately 20.1 million votes purchased for 0.0652 ETH for a TMC Recommendation proposal, along with several smaller transactions of around 1 million ARB purchased for less than $20.

The vote-buying controversy emerges amid broader governance challenges. A recent proposal seeks to reclaim all unutilized funds from the Gaming Catalyst Program, citing management issues, reduced commitments from key contributors including Treasure DAO's exit, and transparency problems. This reflects growing tensions in how Arbitrum manages its substantial treasury.

The Arbitrum Foundation views this as a "precedent-setting moment" that requires community discussion about whether vote-buying platforms should be allowed in governance. The Foundation notes the discussion should remain independent of CupOJoseph, who expressed concerns about LobbyFi's pricing model for the election. They waited until after the election concluded to begin this conversation.

According to LobbyFi's published motivation for their pricing, they enabled vote buying for the OAT election because candidates had been pre-approved by the Foundation. They charged a flat 5 ETH for an "instant buy" option, with potential auction wins starting at 0.5 ETH. LobbyFi noted the potential compensation for winning candidates would be approximately 66 ETH, factoring in both monthly compensation and bonus ARB tokens.

The main concern raised is whether legitimacy issues arise when candidates get elected not because of active delegate votes, but because someone purchased enough voting power to swing results. This raises questions about representation in the OpCo leadership and oversight functions. The Arbitrum Foundation suggests the community needs to decide whether people should be allowed to "explicitly purchase, and compete to purchase, votes."

While vote buying services can activate otherwise dormant voting power and provide transparency about purchased votes, the Foundation questions whether "selling the right to make decisions to the highest bidder" benefits the decision-making process and Arbitrum as a whole.

Community responses highlight several viewpoints:

• Some delegates argue censorship isn't the solution, noting that LobbyFi simply makes transparent what already happens through private lobbying. They suggest prohibiting vote buying would push influence "further into the shadows."
• Others propose focusing on increasing active voting power distributed to aligned delegates, making technical changes to vote buying platforms, and potentially updating the Code of Conduct.
• Several contributors suggest that tackling voter apathy through ARB staking or other yield mechanisms would address the root cause by providing alternatives to selling voting power.

The Foundation invites all community members to discuss whether vote-buying services should be allowed in ArbitrumDAO governance and under what circumstances.