Revenue from basic charges and excess income derived from network transactions will be channelled to Arbitrum’s DAO, in the aftermath of a recent disagreement between the Arbitrum team and its community members.

Arbitrum, an Ethereum layer-2 blockchain, declared via Twitter on May 9 its plan to allocate Ether (ETH $1,878) approximating $6.2 million to its Decentralized Autonomous Organization (DAO).

The funding derives from base charges and overflow earnings amassed from transactions across the network. Arbitrum’s announcement highlights the collection of a total of 3,352 ETH by its DAO. As entities native to the internet, DAOs are jointly owned and managed by their community members, maintaining their treasuries, and decision-making processes involve group-voted proposals.

Widely employed by numerous decentralized applications and blockchain developers, Arbitrum serves as a pivotal scaling network. Every user incurs a fee while performing transactions on Arbitrum One.

The present costs associated with ETH transfers on Arbitrum are $0.25, and token exchanges stand at $0.68. As per Crypto Fees data, Arbitrum users have expended $387,423 in fees in the past week.

Fees paid on Arbitrum One get bifurcated into two segments – the L1 fee and the L2 fee. As per the protocol, the L1 fee compensates for the expenses of lodging a transaction on the Ethereum network, and the L2 fee is for maintaining the network.

The Arbitrum Foundation revealed to Cointelegraph that, “All proceeds from the Arbitrum Network funnel into the DAO treasury, and its allocation rests with the DAO’s decision.”

Revenue dissection uncovers approximately 582 ETH of surplus funds originating from the L1 fee, close to 1,308 ETH from base fees, and a 1,462 ETH overflow from the L2 fee. In total, this signifies a revenue of 3,352 ETH for Arbitrum’s DAO.

A related proposal from an unidentified member of Arbitrum’s governance forum encourages the protocol to institute a revenue distribution mechanism, to be activated periodically by a smart contract. As per the suggestion, delegated ARB tokens would qualify for revenue distribution. However, the DAO hasn’t voted on the proposal yet.

The proposal purports to “synchronize community incentives and lend ARB a purpose beyond a pointless governance token.” The majority of the community members, as indicated by the governance forum, endorse this proposal. However, some members caution that this revenue distribution could further label the ARB token as a security.

Arbitrum’s decision to distribute revenue follows a recent conflict between the protocol’s team and its community over a fund transfer worth nearly $1 billion, which was not authorized by ARB token holders.