Optimism Retroactive Funding Draws Flak for Public Goods Omission, Lack of Community Input

Optimism's latest retroactive funding initiative, aimed at rewarding crypto projects for their contributions, has faced criticism for its departure from the initial focus on public goods. Despite an allocation of $3 billion, some members of the community have expressed disappointment over the reduced emphasis on public goods and the lack of input in key changes. The shift in branding from "Retroactive Public Goods Funding" to "Retro Funding" has also raised concerns about transparency and decentralization within the Optimism ecosystem.

Optimism's Retroactive Funding Program Draws Criticism for Deviation from Public Goods Emphasis and Lack of Community Input

Optimism's fourth iteration of retroactive funding, an initiative designed to reward crypto projects based on their current impact, has faced criticism from certain quarters. The detractors have expressed disappointment over the reduced emphasis on public goods and the lack of community involvement in the decision-making process.

Initially dubbed "Retroactive Public Goods Funding" (RPGF), the program has now been rebranded as "Retro Funding," a change that has omitted the "public goods" element. This shift has dismayed some within the crypto community, who argue that it dilutes Optimism's original vision of supporting developers, businesses, and educators who contribute to its layer 2 blockchain network built on Ethereum.

Lefteris Karapetsas, founder of portfolio tracking service Rotki, characterized the departure from public goods as "appalling." He expressed his dissatisfaction in Optimism's forum discussion, lamenting that the change was made unilaterally by the Optimism Foundation.

"Was it just a meme to pull us all in, have good marketing for the superchain [the name of the network of blockchains that rely on Optimism's OP stack] and then when that's accomplished, we just throw the public goods out?," Karapetsas asked.

In response to the criticism, Lynette Nolan, head of communications for Optimism Unlimited, a subsidiary of the Optimism Foundation, clarified that the name change was intended to enhance clarity and accessibility for newcomers in the crypto ecosystem. She explained that research and focus group feedback indicated that the term "RPGF" was mainly understood by those already engaged with the Optimism ecosystem.

However, some community members remained unconvinced by the explanation. Paul Dylan-Ennis, assistant professor at the College of Business, University College Dublin, expressed concern about the timing of the change, which he viewed as a setback for the "Regen" (regenerative) vision pioneered by Optimism. He lamented that the funding round had become indistinguishable from similar programs in other layer 2 protocols.

Beyond the name change, critics also raised concerns about the lack of community involvement in the decision-making process. Tim Daub, founder of web3-focused Kiwi News, asserted that the decision to exclude public goods in name was not formally sanctioned by the OP community. He argued that the community had not been given an opportunity to express its views on the matter.

This perceived lack of decentralization has further fueled criticism of the latest funding round. Latruite.eth, a user in the Optimism forum, expressed mixed feelings about the program. They questioned the value of decentralized governance if the Foundation retained the authority to make all important decisions.

Despite the criticism, Nolan maintained that public goods remain central to Retro Funding's mission, even if the term is no longer included in the official name.

The market reaction to the news has been muted, with OP, the native governance token for Optimism, experiencing a modest decline of 2.4% over the past 24 hours, trading at $3.61 at the time of writing.