1. Summary -
Proposal for the DAO to consider a small percentage (perhaps between 0.01% to 0.05%) of income from revenues to be taken as a budget to cost-average (monthly, weekly, or bi-weekly), and allocated in stablecoins and/or other cryptocurrencies to diversify the DAO’s treasury, and reviewed and managed on a quarterly basis through a small team that submits quartely proposals to the community.
2. Abstract -
This discussion is just to start the conversation, and clarify details such as:
- Which cryptocurrencies to include in this treasury diversification initiative
- What cost average periods
- How can cost average periods be adjusted each quarter
- By how much can the percentage be adjusted each quarter
- How will each quaretly proposal revision be managed (proposal format, Deadlines, workstream leader, etc)
3. Motivation -
To support the DAO’s to have a diversified treasury. At the moment, all we hold is FOX. For practical operational purposes, it is very likely that before the end of the year we will want to contract with some core engineers to keep the product running and fix bugs, at a minimum. To offer contracts in stablecoin to core teams is a best practice for many DAOs. Having the option at a minimum I think is essential to the success of the DAO.
4. Specification -
This discussion is meant to clarify specifics.
Some suggestions and rough outline on the initiative:
- TUSD (0.005%)
- UST (0.005%)
- USDC (0.01%)
Store of Value Coins:
- RenBTC (0.007%)
- WBTC (0.003%)
The above exemplifies a 0.03% allocation if using that percentage of income made monthly for the diversification budget. Percentage of allocation will vary if given a defined budget for this initiative.
5. Benefits -
Diversification enables a resilient treasury to handle multiple possible future market conditions. Specifically, stable coins are a hedge against a down crypto market. We have lots of FOX, let’s not keep all our eggs in one basket.
6. Drawbacks -
To be identified and discussed, also depending on execution.
Would love to hear other drawbacks.
7. Vote -
An eventual “For” vote (after clarifying details) would be a vote to use income generated on a monthly basis to diversify into other stablecoins and store of value currencies and approved according to the DAO’s community. A workstream leader may be chosen to put together quarterly proposals, with updates and changes in allocation, to the community for approval of diversification adjustments.
An “Against” vote would vote to not take any action in this regard.
To leave everything as is.