As ShineDAO is growing it will become even more important to create scalable and decentralised processes. Currently we are managing the ShineDAO treasury centrally and that works okay for now since we do not have that much in-/outgoings. As we grow it will become cumbersome to manage.
A solution to this is to implement a treasury management system, and here are a few benefits it might bring:
- Legitimacy: Today the treasury is not sufficiently decentralised, which is a risk that can inhibit further growth. Gives us legitimacy as a DAO to have our treasury sorted
- Yield: There’s a potential to generate yield on the treasury, which will enable further growth
- Scalability: By using the right tools for this, we can save a significant amount of time. Especially when we grow and will have more in and outgoings to keep track of.
After doing some research on different alternatives (Gnosis safe, Multisafe, Llama, Hedgey, tokensets) it seems like the “industry standard” and best alternative is Gnosis safe.
Some neat features of Gnosis safe are:
- Multisign - Require multiple team members to confirm a transaction before proceeding
- Multi chain support (Arbitrum, Polygon, Avalance, etc). More info here: https://blog.gnosis.pm/gnosis-safes-multichain-future-b676b5b8f431
Co-signees: Two out of three co-signees (i.e. key owners) need to sign each transaction
- Treasury Manager
- 2x contributors and or comittee
- Selection of roles on a volunteer basis, followed by a DAO voting
- Term length: Start with quarterly, and consider half-year basis when we’ve tried it out and had some learnings
- Threshold for confirming a transaction: Start small (all transactions should be confirmed) and increase the threshold as we learn.
- Multi-chain compatability: Mainnet, polygon, xDai, more info
Who can be a co-signee?
I think that we should check 3 things when considering who should be a co-signee:
Credibility - How long has the person been involved in Shine and what value have they brought to the DAO?
Personal stake - skin in the game? Is the person invested financially in the DAO? Do they hold tokens?
Availability and commitment - We should not need to wait for someone for days in case we want approve certain transactions quickly. Not that we would require 24/7 uptime but at least I believe that they should be able to check the wallet once per day.
I suggest that we take an approach where we gradually upgrade our treasury management. Suggested roadmap:
- Integrate Gnosis safe multi sign → Result: Decentralised treasury management (#1 above)
- Integrate MultiSafe (Gnosis safe multi-sig account required) → Result: Yield and Scalability (#2 and #3 above)
1. 1-click mass payouts - Makes it easier with salary management
2. Manage Teams & People + Spending limits - set up teams with dedicated budgets that they can centrally manage
3. Asset allocation - generate yield by staking idle treasury funds into various DeFi protocols. For this functionality we can also use Tokensets
I have talked to Nxo, Mr Rock, Drunkboy, Badgerton and Cinque to gather input. I’ve assessed this mainly from a business perspective and done some basic technical research.
I don’t think we need to have all practical questions sorted before proceeding, so I think we should just focus on the dealbreakers (listed under details ). Other dimensions of treasury, such as how we should manage teams and spending, asset allocation strategy, etc. is something we can learn about as we go.
Questions yet to be resolved
- What is Gnosis Safes future business model? I think it is free today, but can we potentially lock ourselves in
- How does the technical integration work?
- Salary for treasurer and contributors
- Does Gnosis Safe support multi-chain?
- If we like Gnosis Safe we can initiate a partnership and use it for projects that we incubate
Looking forward to hearing your input and questions on this so we can create a proposal and vote on it.
Intro to Gnosis, Multisig, etc.