Shapeshift X UMA Pre-Proposal (POLLS)

Hey Fox community!

Below this initial post, I will be including a number of polls related to the the UMA X Shapeshift proposal drafting process. These polls will stay active until the proposal idea either reaches the next step of the process (Ideation in boardroom) or does not move forward. The following is a current draft of ‘Mint & Sell Range Tokens for Treasury Diversification’:

Summary: A proposal for the ShapeShift DAO to mint and sell UMA Range Tokens. The sale would bring in stablecoin to diversify the Treasury and would also help with operational expenses.

Abstract: Forty comments with twelve ‘thumbs up’ shows good engagement surrounding Mint and Sell Range Tokens for Treasury Diversification (Discussion centered around motivation and moved into more specific details relating to UMA Range Tokens. Please follow the link and consume the thread for full context).

Motivation: Being that FOX is the only current asset held by the ShapeShift Treasury, the strength of the Treasury can be compromised by sudden or even gradual downward market trends.

  • Selling Range Tokens for stablecoin helps protect the TVL of the Treasury.

  • Stables can also be applied to operational expenses and other DAO necessities that will come along as ShapeShift expands.

Specification: Sean from UMA presented the design of the Range Token in detail within the original proposal. This slide presentation offers another source of detailed explanation.

After discussion between ShapeShift & UMA core team members, the following Range has been suggested when minting these synthetics:

A total value of 5,000,000 FOX will be authorized by the ShapeShift DAO as collateral to mint the UMA Range Tokens.

Benefits: As Josh words it in the original proposal, “More coins than FOX in the treasury. Diversification. More 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.” And as mentioned above, selling into stablecoins gives the DAO leverage to hire future developers, pay for one-off jobs, secure legal council, etc., etc.

Drawbacks: Though the proposition would secure ‘said amount’ of UMA Range Tokens. Selling the Tokens isn’t a given. ShapeShift will have to sell these publicly or OTC. A worst case scenario for the Range Token itself is an expiry/maturity at the bottom of the range. Investors would still get the original value of the collateral back upon expiry in such an example.

Vote: A ‘Yes’ vote authorizes the DAO to employ $5,000,000 from the FOX Treasury as collateral to mint UMA Range Tokens and begin sales discovery.

A ‘No’ vote declines this authorization and effectively ends the proposal.

(Big thanks to inalittlewhile for putting together this pre-proposal foundation in order to fill in the blanks with the community via data collection)

14 Likes
Range, Success, or Both?
  • Range
  • Success
  • Both Range/Success (40/60)
  • Both Range/Success (50/50)
  • Both Range/Success (60/40)

0 voters

4 Likes
How to hold sale of tokens?
  • Privately
  • Publicly
  • Both Private/Public (40/60)
  • Both Private/Public (50/50)
  • Both Private/Public (60/40)

0 voters

3 Likes
Total Stable Coin Diversification Amount (In Millions/USD)
  • 1
  • 2
  • 3
  • 4
  • 5

0 voters

4 Likes

Seems like an excellent way to diversify our treasury. I feel like many communities will be using UMA products for this now that it’s available and would be good to jump on this opportunity early.

8 Likes

Thanks @huntthewick for setting up these polls. Super interested to see the results as a temp check of the greater ShapeShift community. Onward and upward.

,Inalittlewhile

4 Likes

UMA has the right tools for DAO development :clap:

5 Likes
Expiry Date from Start (Months)
  • 3
  • 6
  • 9
  • 12
  • 18
  • 24

0 voters

1 Like
Determine Range:
  • 0.25 - 2.50
  • 0.50 - 2.00
  • 0.50 - 3.50
  • 0.20 - 5.00
  • 0.10 - 7.50

0 voters

3 Likes

I’m excited to see this post and the polls associated with it- very clear that a lot of thought is being poured into treasury security and utilization, which makes me proud to hold FOX tokens.

I look forward to seeing what combination of range and success tokens the community supports, as I think there will be a ton of interest from both private and public parties.

Big shout out to the brilliant minds behind this proposal :raised_hands:

5 Likes

This is a great treasury tool to minimize a loss due to an unforeseen drop in the market. When doing a raise it keeps the investors from dumping their tokens to re-purchase if given a huge discount (which they always seek a huge discount).
You don’t have to worry about a VC dumping your native tokens as soon as they reach a profit.
Can be sold OTC or publicly so, the community and others could purchase range/success tokens and bet on the success of Shapeshift! :fire:

5 Likes

Wow, the proposal seems fair enough, and i am curious to see the polls results now. UMA is doing the job.

3 Likes

I appreciate the work done on the proposal. Even with trading and financial formal education and years of experience, I don’t feel knowledgeable enough to vote on the last two items, so abstaining. I appreciate the option of choice! That being said, while I am aware enough to be comfortable voting on the “what”, it feels like the “how” should be left up to someone with more subject matter expertise. My votes give me power to make decisions I am comfortable in my own responsibility for myself, but not for others. I hope others have a similar perspective.

3 Likes

Thanks for the valuable input @FoxHodl.

While I feel like the data from the polls offers some good insights into the desires of the FOX community, I also agree with your assessment.

I think once Workstreams are in full force here, this might be a case where we could turn the task over. This being the first more complex proposal definitely offered some learning experiences.

Looking forward to tomorrow’s Governance Call and further discussion.

For anyone who wants a good explanation of how the Range & Success Tokens can be designed, UMA just released an info slide that covers it in simplified detail.

https://twitter.com/UMAprotocol/status/1423069425478078472?s=19

1 Like