AIP-242: Working Group Charter - Treasury

Final AIPs Rejected AIPs
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Proposal Name
Working Group Charter - Treasury

Category
Process Proposal

Authors
Mona El Isa CEO and founder of Avantgarde Finance
@moss, Business Development Lead at Avantgarde Finance
WG0 Stewards: @adventurousape, @Amplify, @badteeth, @Halina.eth, @Lost, @Vulkan, @Waabam

Working Group Zero (WG0) is the working group mandated with proposing Working Group guidelines and transitioning DAO operations into the hands of the community.

Avantgarde has been the core contributor to the Enzyme protocol since it was decentralized in Feb 2019. Enzyme has a four year track record on chain as the first decentralized asset & treasury management protocol.

Avantgarde also runs an asset management business which currently manages more than $30m in assets for its clients. Customers include Nexus Mutual, ADEX Protocol and others. References can be provided upon request.

Abstract
As indicated in this AIP, the following Treasury Working Group Charter outlines how a Treasury Working Group would operate within the ApeCoin DAO in order to oversee decentralized ownership of assets with a mandate of exploring options for sustaining the daily operations of the DAO.

Introduction
The goal of this proposal is to establish the ApeCoin DAO Treasury Working Group. The Treasury Working Group’s mandate is to: “Explore legal and governance structures that would enable the DAO to sustain operations and Initiatives in perpetuity. The Treasury Working Group would also request a grant from the foundation, exploring ways to deploy it thoughtfully on-chain while promoting a non-custodial environment.”

Working Groups enable a sustainable community-led infrastructure that further decentralizes the DAO, creates operational efficiency, and is flexible enough to adapt to any opportunities that may arise. The guidelines for how this Working Group will function are proposed in AIP-239.

Motivation
The ApeCoin DAO is going through an important restructuring with the recent effort to create several dedicated Working Groups. There is clear support for a more professional and transparent treasury management evidenced by the recent Transparency Report and the WG0 AIP.

The fragmentation of the $APE reserves on a plethora of scattered wallets and the hefty fees paid by the DAO for centralized custody services are examples of foundational aspects that need to be tackled and can be improved upon with time.

Rationale
The recent activity in the community shows that the direction of the ApeCoin DAO is to favor increased and developing automated solutions.

The first step towards decentralizing the management of DAO assets would be to explore the legal and governance structures for an “enDAOment” Initiative for the ApeCoin DAO in order to ensure sustainable operations forever.

The second step would be to request a budget from the DAO and increase the level of transparency and accountability for those assets. In a third step, the Working Group would be planning for future on-chain non-custodial management of these assets.

Key Terms

  • Working Group Charter: A document published to the Discourse category relevant for each Working Group, which outlines a Working Group’s mandate, scope, and reporting requirements.
  • Funding Window: The final 15 days of February and August each calendar year in which Working Group Leads propose Working Group Budget Proposals.

Specifications

Treasury Working Group Charter

Treasury Working Group Mandate and Scope:

The Treasury Working Group is responsible for exploring legal and governance structures that would enable the DAO to sustain operations and Initiatives in perpetuity. The Treasury Working Group would also oversee a portion of the ApeCoin DAO’s assets, received by the Treasury Working Group as a grant from the DAO, exploring ways to deploy them thoughtfully on-chain while promoting a non-custodial environment. This includes but is not limited to:

  • Researching and consulting on legal and governance structures which can support the activities of an “enDAOment” Initiative in order to sustain the daily operations of the DAO;
  • Exploring ways to implement a soft deployment of an on-chain ApeCoin DAO Treasury;
  • Researching and implementing a risk assessment and management framework;
  • Researching and implementing a monitoring framework to give community transparency;
  • Defining the reporting requirements and future practices for the treasury; and
  • Considering any regulatory implications for individuals involved;

OKRs to complete before August 2023 Funding Window:

  • Deploy a Gnosis Safe multisig for the Working Group.
  • Develop a comprehensive risk assessment criteria for asset management and allocation.
  • Research and design an on-chain treasury management strategy.

Given the delay in this AIP being pushed to vote and the fact that the Aug 2023 funding window is rapidly approaching, these OKRs will be completed on a best-effort basis and may not be finalized by the Aug 2023 funding window.

Treasury Working Group Reporting Requirements:

The Treasury Working Group will report to the DAO semi-annually on asset allocation, risk profile and budget expenditures.

Treasury Working Group Stewards:

All three Stewards of the Treasury Working Group will be elected by the Ape Assembly. The election process is outlined in AIP-239 in the Working Group Guidelines & Process section.

Treasury Working Group Budget until August 2023 Funding Window:

This AIP serves as a general temperature check for incorporating this Working Group. The three elected Stewards will propose an initial budget 1-3 weeks after being onboarded.

–End of Charter–

Steps to implement

  1. Approve the formation of a Treasury Working Group.
  2. Hold an election to elect three Stewards who will oversee this Groups’ operations.
  3. Establish a budget and set of guidelines for the Treasury Working Group to follow.
  4. Engage the community to surface new ideas and contributions.
  5. Provide regular updates to the DAO community on the group’s operations and decisions.

Timeline

  • 1-3 weeks after Stewards sign onboarding documents: Establishment of budget and guidelines.
  • Within 45 days of the Stewards onboarding: Treasury Working Group begins operations.

Overall Cost
$0. This AIP serves as an initial framework to establish this Working Group. The three elected Stewards will propose a budget 1-3 weeks after being onboarded.

Disclaimers

Avantgarde Finance is the core contributor to the Enzyme protocol (formerly known as Melonport). Avantgarde has been developing purpose-built treasury management infrastructure since 2019 and wants to be an integral part of the Treasury WG and one of the objectives is to help Apecoin DAO deploy capital onto Enzyme. However, as the value of sound risk management is clear, Avantgarde is also open to providing asset management service outside the natural infrastructure of choice.

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This first comment is reserved for the changelog and recap of the most important feedback from the community.

  • Edit #1: Wrong link to WG0 AIP replaced for the correct one, which is WG0 AIP
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Really appreciate @moss and Mona jumping in to create this initial charter.

This is exactly what working groups empower – a place for those with domain-expertise or interest to contribute meaningfully to the future of the DAO. :pray::facepunch:

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On Discord it was said to post here if interested in participating. This one’s 100% in my wheelhouse.

I’m beyond qualified, am not part of the current in-crowd, not into big spending just because we have the funds, and not entirely a fan of this deluge of WG proposals lacking in neutral, qualified 3rd-party ethical or practical oversight (so I do and will push for legit 3rd-party audit and ethical oversight)… which makes me an ideal candidate for balance in addition to:

Been comptroller for a major international bank and CFO / on BoD of several public companies. As a result, I work with securities lawyers constantly so know all about regulatory landscapes and compliance. Also have a past life in tech / coding. I’m an optimist, but very much a realist. Been in crypto since 2012, very early in NFTs, and in BAYC since near mint plus hold one or more of the main Yuga assets since early days.

I’m also an adjudicator for one of the biggest arts (music) grants orgs in North America. That’s not a financial role, however in addition to seeing many companies and artists go from seed to success it gives me a unique full-spectrum familiarity with funding projects of various types at every stage, and the typical pitfalls.

I am not a co-author of this proposal, all over social media platforms, or into political campaigns. Not at all into our DAO copying the worst models from IRL rather than taking a leadership role in the space procedurally and ethically: popularity contest type elections are the worst way to place people in key positions anyway, so “highly qualified but not pandering or in cahoots” sums it up well.

Cheers, and remember to have fun!

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Hi @moss,

Your topic will be automatically closing in less than 24 hours. Are you content with the feedback received, or do you wish to extend community discussion for a further 7 days?

If we do not hear from you within 48 hours after your topic closes, your topic will be moved straight to the AIP Draft process.

We look forward to hearing from you.

-Amplify

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Then… is there a vote to approve the budget? What if it isn’t approved?

There is no worse way of appointing people to important positions than elections. Will the elected Stewards undergo proper background and criminal checks? Will they be tested for any related knowledge or experience?

There isn’t a word in this proposal about audits. Lots of talk of budgets and operations and decisions, but no true oversight or proper reporting proposed. Same with the other Working Groups.

There isn’t a single instance of the word “audit” on ApeCoin.com and only one instance of the word "oversight’ which - spoiler alert! - isn’t related to finance / treasury / distributions.

Who are ApeCoin Foundation’s auditors? Where are the audits token holders can look over, along with the auditor’s comments and opinions about risks and any (many) improper / lack of standard processes, etc.?

Who is getting paid by the DAO currently, for how many things, how much, when, and for how long? How many AIPs are being given money without any ending to the payment or accountability, and how much? Has Guy Oseary done anything with the fantastic amount he was given?

Anyone’s welcome to answer, if anyone actually can.

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Thanks @amplify.Admin, we are content with the current feedback and do not currently wish to extend the community discussion for 7 more days. We would like it to go to draft stage asap.

@br00no thanks for your feedback. Yes there will be a subsequent budget proposal that will outline things in further details. I don’t have all the answers to your questions, especially the ones directed to Apecoin, but from our side we are definitely keen to implement a treasury management practice based on the fundamental principles of on-chain transparent real-time reporting, protocol due diligence (incl. audits) and non-custodial asset control.

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Thank you @moss for your ideas and the ApeCoin DAO community for the thoughtful discussions. A moderator will get in touch with the author to draft the AIP in the appropriate template. Once the AIP is drafted and meets all the DAO-approved guidelines, the proposal will be posted on Snapshot for live official voting at: Snapshot

Follow this Topic as further updates will be posted here in the comments. @moss please see your messages for the next steps.

-Amplify

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Hello @br00no!

Yes! When the Stewards are onboarded they will propose a budget. If the budget is not approved, they will propose a smaller budget.

We’ve spoken at length about elections and their effectiveness so I will avoid addressing them here as well.

I’m not sure, we would need to ask the Special Council. Otherwise, I believe we (the DAO) would need to propose an AIP to engage an auditor, or the auditor themselves would need to propose an AIP to audit our Foundation.

Outside of the Foundation reporting requirements in AIP-121, no one is responsible for keeping track of this or reporting this regularly to the DAO. Having a DAO Secretary and Treasury Working Group as a part of the Working Group Guidelines AIP would help solve for many of these transparency issues.

I will attempt off the top of my head to answer though: 5 Special Council members, 1 Foundation Director, 1 Foundation Secretary, 1 Cayman Administrator (with their own team), 7 Stewards funded for another 11 days, three newsletter grant recipients, legal council and Llama for the implementation of their bug bounty.

None. All AIPs and grant agreements are for a maximum of 1 year. You can not put up an AIP that says “Pay Jon 100 APE forever”

No, and his budget ends in two days. It appears it will go entirely unspent and will remain in the Foundation Treasury.

I hope this helps!

-Amplify

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Thanks, @Amplify

Yet zero of these issues are addressed in the AIPs for those positions.

Thank you. To be clear, some are being paid for newsletter and as Stewards, AND/OR as part of ApeComms?

No one is sure because there are no audits. ZERO proper oversight or accountability, but it’s apparently better we all rush to get our ladles in the gravy trough than worry about it. In crypto of all sectors, what could possibly go wrong?

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Thanks, @moss

Great. Why not put this in writing in the AIP then?

Only audits from qualified, neutral, 3rd-party entities including comments in plain English re: risks, bad practices, related parties, regulatory concerns, etc. are oversight. Nothing else. Transparency is nice, but that leaves it up to people to take an interest and possibly sound the alarm. As can be plainly seen, if anyone gets around to doing so it’s generally ignored.

Human nature works that way. More so when everything is remote, anon, decentralized, requiring effort and esoteric knowledge.

Everyone wishes they’d noticed they bought a home below the water line in a notorious flood plane after the destruction… but by then it’s too late, even though those facts were transparent, and even though they were probably keen to maybe get around to it depending on which randos were elected, with or without relevant knowledge or qualifications, to propose a budget for looking into it to maybe do it eventually.

I’d emphatically told people how much they or their kids could learn about self-governance by joining this DAO. I wasn’t wrong, but the irony is that despite best intentions all they’ll learn is copying the worst of IRL just results in a meta-version of IRL governance and the fiscal boondoggles that go with it.

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While I don’t speak for @Amplify, both AIPs calling for establishing ApeComms as an official ApeCoin DAO entity (AIP-142 and AIP-175) were rejected, so no member of ApeComms was approved funding for that specific role, at least.

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100% agree on this, and have said as much on the other two Working Group Charters. Responses were in line with moss’s on yours: not all details were in writing on these Charters, and that we can expect more once this passes. I for one would prefer as much detail as possible the first time, and while I understand the need to move swiftly in this administrative transition period we’re facing, making the whole picture as clear as possible, as early as possible, is a net positive.

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Thanks. I thought one was passed. My mistake. It seems that’s where most of the discussion and info takes place, rather than here, and given the cross pollination of ApeComms ppl with Stewards, DAO/AIP discussions, etc. the off-hand “We’re not official” disclaimer at start of Spaces would prevent no regulators or lawyers from making the connection if they ever decide to.

If there’s no formal payments from DAO to Comms, for now, that’s a very slight separation at least.

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Thanks, CL. What is “the need to move swiftly”?

I’ve always puzzled at this rush to do things wrong, onboard as many people as possible as quickly as possible, etc.

Rather we should rush to do things right and to not copy the worst possible models known.

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It occurs to me that the ApeComms and DAO “cross-pollination” really points to a larger reality of our DAO in its current state: not a lot of people outside of our DAO are doing much to speak about it. ApeComms, to my knowledge, is the ONLY regularly hosted space discussing ApeCoin DAO, its AIPs, and its active goings-on. Alex, (ShillinVillian) and his crew put forth an AIP soliciting $APE funding to give out on their Spaces for audience members who can successfully answer DAO-related trivia, but after tuning into one of their regular spaces for the first time I was a firm “no” against that idea.

It occurs to me that this is symptomatic more of a DAO marketing issue than anything else. ApeComms steps up to inform because others simply aren’t, and the people in a position to be able to provide that content also happen to be embedded in the ecosystem. I’d love to see some popular, well-informed Spaces hosts regularly discussing AIPs and DAO-related content, but we simply haven’t seen that.

(I’m not affiliated with ApeComms in any way, this is merely a personal observation.)

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I misspoke, I meant to write the “urge to move swiftly.” I am all in favor of a slow, deliberate process that anticipates and addresses any foreseeable future conflicts, concerns or impediments to the smooth and efficient operation of our DAO. It was an acknowledgement that many people feel we need to move faster than we are, structurally, and I confusingly misspoke on that point.

The grant process on the other hand…

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This topic was automatically closed after 7 days. New replies are no longer allowed.

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Hi ApeCoin DAO Community,

@moss has completed editing their AIP Idea to be their AIP Draft.

Follow this Topic as further updates will be posted here in the comments.

Kind Regards,

-Amplify

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Hi ApeCoin DAO Community,

@moss has responded to our questions and they are in our review once again.

Follow this Topic as further updates will be posted here in the comments.

Kind Regards,

-Amplify

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