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A controversial proposal seeking the return of 700 million ARB governance tokens to Arbitrum’s DAO Treasury was rejected by a massive number of votes on April 15. The Improvement Proposal AIP-1.05 was introduced after the Arbitrum Foundation transferred funds without community approval in March. The AIP-1.05 was defeated by 118 million votes, representing 84% of the total votes received, while 21 million ARB tokens voted for the proposal, nearly 14.5% of the total. Around 2 million ARB tokens abstained. The proposal asked the Foundation to return the tokens as a “symbolic gesture to demonstrate that the governance holders ultimately control the DAO, not the Arbitrum service provider nor the Foundation.”Screenshot – AIP-1.05: Arbitrum Improvement Proposal Framework. Source: Arbitrum DAO. On the governance forum, a whale with 4.8 million ARB tokens said the proposal “seems to only serve as a power play” that would add an “unnecessary step” and delay the Foundation’s ability “to support the growth of the Arbitrum ecosystem.”Another whale voting against the proposal with 18 million ARB tokens stated that balance is necessary to promote decentralization and progress in the ecosystem: “There is a balance that we need to try to accomplish between advocating for decentralization and preventing progress in the ecosystem. I believe that decentralization on its ideal form is nowhere to be seen in this industry yet.”Arbitrum’s community and its Foundation are engaged in a dispute over the Foundation’s governance proposal AIP-1 — which called for investment of nearly $1 billion worth of ARB tokens to fund its operations. After facing community backlash, the Foundation later said that AIP-1 was a ratification, not a proposal. It added that some of the tokens were already sold for stablecoins.The AIP-1 proposal was Arbitrum’s first attempt at governance after its tokens airdrop in early March. The Foundation has already released a new set of improvement proposals aimed at reestablishing dialogue with the community.Magazine: The legal dangers of getting involved with DAOs

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