The Bancor DAO needs a treasury. Without a treasury, we will always have a very limited scope of control over the project we are trying to govern.
I want to start the discussion for how we could fund it, what we should keep our treasury allocated in, and create a set of guidelines for how treasury funds are used.
How we fund it:
It’s extremely important that we do not print BNT. I think our treasury should be created through protocol revenues - primarily from trading fees.
Before diverting any fees to a treasury, however, we should first overcome the deficit. In the long run, I think 5-10% of fees are reasonable for building our warchest. It’s also worth exploring other ways to build our treasury. It was suggested that we ask for a small fee from projects who want their token whitelisted - this seems reasonable to me in general, and perhaps there are other ways we could start accumulating our treasury.
Eth + DAI.
Happy to hear alternative opinions but this to me seems solid. We absolutely cannot keep our treasury in BNT - otherwise we would be cannibalizing our own token’s value by taking any actions with our treasury.
Treasury use should require a vote. I’d appreciate input here - my initial thought was 40% quorum and 80% supermajority. We might want more flexibility for smaller treasury requests - for example maybe anything under $10,000 only requires 25% quorum and 66.6% supermajority.
We should also set guidelines for what the treasury can be used for. IE protocol development, funding projects that promote the protocol, etc.
Please share your thoughts, I’d love any feedback or ideas that could make this better.
may I suggest separating the mere idea of there being a DAO treasury (even if it has 0 BNT in it) from how it might be funded
while the existence of a treasury seems like a no brainer, there’s probably some process and hoops to establish it that may take time so best to get started without being derailed by the “how to fund?” question
and on the topic of funding it, i have no idea if/things will return to normalcy around here, but historically many projects came to the DAO asking for coinvestments and insurance for their project’s liquidity, and benefited much from the DAO voting “yes” right up to the moment ILP was paused. We can ask for funds in return for services, in fact NOT asking for enough funds to cover the cost of providing services is how we ended up here. The idea that everything has to be covered by trading fees is not even supported by the B3 design, which allows for third party rewards/ILP. Many treasuries are (were?) already willing to help cover deficits in their token’s pool, without BNT/fees being forced to take 100% of that burden, which in turn reduces the burden on deficits in other pools. In that context, why wouldn’t they also be willing to offer the DAO some nominal additional funds for the purpose of managing protocol risk? clearly projects suffer when protocol risk is mismanaged, and nobody does their best work for free.
I second OP’s and Asaf’s thoughts: the need for a treasury DAO has rarely made more sense than it does now. More important still, if we are rightly not proposing minting BNT to fill the DAO treasury’s coffers, then a successful fee-generation model (which I believe we will see in the coming weeks) will enable us to push for the implementation sustainably.
I don’t see why we can’t vote on it now, with the implement being contigent on a successful fee-generation model.
we should NOT make establishing a treasury contingent on anything
lets immediately establish an empty treasury that could be funded if/when we manage to secure funds
protocol fees will never be an appropriate source of DAO funding btw
the foundation already showed that there are zero AMM examples of protocol fees outpacing IL in aggregate, so the protocol already needs significantly more than 100% of the fees it generates just to survive
focus DAO funding efforts on DAO activities not protocol activities
any time the DAO needs to vote, assess risk, do onchain stuff, or any other work, there is justification and opportunity for it to charge whatever entity benefits from that work
I think this proposal to take 5-10% of revenues off the top is completely tone deaf when considering the deficit we are in, the draining liquidity, the lack of actual fee generation, the lack of fee generating ideas, and the lack of trust in Bancor Protocol.
How in the world can you justify taking any percent of the fees when so many people lost money believing what they were marketed?
FWIW the DAO didn’t promise anything, and the details of B3 were behind an NDA from the foundation
“the DAO” is just ppl who bought vBNT/BNT on the same promises, then tried to manage v2.1 with no data on liabilities and no information about what the migration to b3 would look like, and no funds to commission such reports or any dev work itself
this treasury is specifically so the DAO can have funds separate from the foundation in order to put towards risk management and data collection activities etc.