This is a good point. You are right the Treasury should hold a lot of $APE but because the price is volatile, it is prudent to diversify and hold other assets as a hedge against that volatility to ensure that you can cover operational expenses. The second reason to hold other assets is that you want to be able to generate returns to allocate capital to the growth of the APE Ecosystem. Different assets e.g. BTC, ETH, Stable coins have different risk and return profiles either through DeFI staking or trading activities. We should be aiming to generate sufficient returns to fund growth of the ecosystem without depleting $APE holdings at a lower risk profile than just holding $APE.
Thanks for sharing the links. I probably should have been, but was not familiar with Babylon! It is a really interesting solution and I want to keep reading through everything you sent.
One thing for this is that given there are fee’s involved, the DAO should probably think about how it wants this to operate. I think we have similar assumptions e.g. active management over passive but the potentially differ on manager driven vs trust minimised. We probably need a level of debate on the pro’s and cons of each and some level of tender type process to compare fee models and performance history’s of the different models to ensure that the DAO is going to get something competitive managed in a way that the community is comfortable with
If you are looking for a return better to work under $APE utility increasing it’s value. Not to devalue it in favor of other assets.
Yes you are right building out the $APE ecosystem is the best way to build value. However, I would suggest we need to do both e.g. Treasury operations should allow us to build value and manage risk. As an example the DAO has 117,500,000 APE at launch which at ATH was worth nearly $3.1B, at today’s price that is worth $0.73B. By diversifying some of the funds into stablecoins (and other coins) we could have derisked a % of the assets and protected that value, whilst staking for passive returns. Whilst 1 APE = 1 APE, the reality at this point of adoption is many real world expenses need to be paid in $/stablecoins and therefore we have 1/3rd the buying power when it comes to covering the cost of the DAO.
How do you think we get this type of proposal moving. My sense is that there needs to be a fe committees made up of committed, engaged and experienced holders who are voted in by the community for a term with some form of incentive/compensation for their time. There are 3 areas (maybe more) where a committee of empowered members could be helpful:
- Treasury: generate returns to cover operational expenses and deploy capital to promote ecosystem.
- Comms: promote ApeCoin and related projects/collections/events etc
- Ventures: foster and incubate creators and builders to add value to ApeCoin
I feel like without this level of empowerment and commitment, it is hard to get from discourse to action. What are everbody’s thoughts?
I apologize for my delayed response. I completely agree w/ the points you listed above. There are steps we can take to get this moving, so lets get started & make something happen.
We need to create a model for working teams. I have a sample proposal we can look at, and will add you to a group chat to look it over & help make changes. Let’s start w/ one team.
The most difficult part of this is finding committed BAYC/MAYC & DAO people who want to work part-time or full-time on behalf of the DAO. Compensation is a hot topic as well.
Its a big win if we can create a network of teams, the DAO becomes less centralized, and we acquire full-time talent for DAO. Essentially we need to know who is available and wants to work!
@adventurousape brings up a brilliant point earlier in the thread too. Her idea needs explored more.
Hey @0xSword – dig these following points:
We need to create a model for working teams - let’s start w/ one team.
The most difficult part of this is finding committed BAYC/MAYC & DAO people who want to work part-time or full-time on behalf of the DAO. Compensation is a hot topic as well
It’s a big win if we can create a network of teams - the DAO becomes less centralized
I think these observations should serve as a foundational model and be shared across most all AIPs - I know I will borrow parts of it for the IRL events ideas and proposals. Thanks
My general take is that a treasury should be a relatively risk-off pool of capital. In an ideal situation we hold a large portion in USD or stablecoins.
Logic is fairly simply, unless you have a professional investment team that is managing this like a hedge fund you probably won’t get top tier investment management.
Even if you do have a great team, the treasury will be needed most in bear markets so USD holds the most value in the worst times because that is when the rest of the project/business will struggle.
Happy to discuss futher
We actually had a couple of proposal ideas about Treasury Management
There are also several active members putting their skills together to create “working groups” across several verticals – perhaps you’d be interested in joining?
Sure happy to join in a discussion
A high weighted variable to Treasury Management is not having a negative impact on the price of ApeCoin while the DAO tries to diversify holdings. If you liquidate 1/3 of $APE, you are releasing a large supply onto the public markets and possibly putting downward pressure on price. This may have negative consequences to other DAO holders.
Also, I might add there is further complexity in the initial sale process of genesis tokens as the Ape Foundation is a Cayman registered company and subject to Cayman Law. Happy to discuss this topic with anyone that would like more information.
A quick explanation of the Ape Foundation can be found here: ApeCoin DAO Dissected: The Foundation
Throughout conversations on this thread & additional places, it appears that this would be difficult to do w/o have a certified company to be fund managers. The complexities make it difficult for an organic small group to take on the task. There are benefits, I believe, but it’s beyond my capability.
It would seem logical to me that before you can make any decision on any aspect of the treasury you need to understand all the variables at play. First and foremost if it is illegal to sell any portion of the treasury all other points are moot.
Second, need to understand circulation, supply, potential impacts around events and what legal disclosures would need to be made for what actions.
Anyways, also happy to discuss this as well. I would assume there is some amount of treasury capital that is sitting in USDC and some that is in $ape?
I guess anyone who would make a decision here needs to understand how things are set up
I agree with you, execution is always hard and takes time. My DMs are always open if anyone needs any more information, I serve at the pleasure of the DAO (I’ve kind of always wanted to say that)
One must understand the legal framework and regulations of the Ape Coin DAO before being a “good trader” matters at all. Brandon brings up a lot of good points about risk of $ape price volatility when actively trading the treasury … I am firm believer that leaving the treasury in $ape incentivizes the dao to build … I don’t believe the treasury should be a tool that 6-10 people should be allowed to play de-Fi with … If we believe in $ape coin there should be no reason in the near future to move the treasury out of that position. $ape is extremely low right now & the treasury still has an IMMENSE amount of capital. I don’t believe hedging is something we need to worry about currently.
Defi traders gonna hate me for this lol
I would be very interested to learn about the legal impacts of attempting to re-invest the DAO funds. Does this affect the foundation’s legal status in Cayman Islands?
@Waabam I have sent you a DM so we can setup a call
Would happily join this to learn more too if possible
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