DAO Activity Update #1

This post is intended as an overview of what the DAO committees have been working on and to get feedback from the community. While I try to be as unbiased as possible, the words here are my own. If you have any questions or thoughts on these topics, please feel free to bring them up.

Allocation Committee

  • Discussed Three Arrows Capital. The USDT pool has a 2 million USDT loan to TPS, roughly 1% of the pool, who is backed by Three Arrows Capital. Reports suggest financial distress. Committee is keeping an eye on their situation.

  • Discussion around incentive alignment of PMs. How to manage oversight and what we can learn from tradfi.

  • Broader discussions around defining risk appetite of the DAO and transitioning from direct loans to having PMs manage funds.

Tokenomics Committee

This committee has had the most discussion and I will try to keep it brief. Things that came up

  • Discussion over locking up staked TRU. Idea was floated of using CRV’s model for voting power and for allocating TRU incentives. General agreement that some level of lockup is good, but views on long lockups were mixed. It helps align voter incentives, but also discourages people who may need the money and sucks liquidity up that could be used in market making or other DeFi apps.

  • Tying into that, discussion over how to incentivize TRU liquidity. Idea was floated to allow ETH/TRU LPs to stake that token in stkTRU. It would take time to implement, but would increase liquidity.

  • Discussion over removing SAFU slashing. After some debate and the recent market crash, consensus seems to be that the market isn’t there to support selling off TRU and the system can be gamed. Committee is looking at alternative schemes to protect lenders, with focus on treasury funding,. It was suggested to lower stTRU incentives as risks will be lower.

  • Discussion on directing lending pool fees to treasury instead of stkTRU. Committee agreed that we need to grow the treasury. Opinions ranged from directing some of it to all of it, particularly if TRU slashing is being removed.

  • Consideration over whether Truefi should return profits through dividends or buy/burn. Buy/burn would benefit all TRU holders, dividends only benefit stakers. Concern that if we do a buy/burn, we need to make sure it isn’t gamed by arbitrageurs.

Policy Committee

  • Keeping an eye on legislation in Congress.

Developer Committee

  • Investigating delegation flow to make delegation easier for stakers. ENS’s model looks most promising, Optimism’s also looks good.

Treasury Committee

  • Discussion over whether TRU incentives for portfolios should be automatic or reserved for lenders who make an extra effort.

Partnership Committee

  • Considering a referral system for borrowers. Cost is a concern.

General DAO Topics

  • DAO is considering how to incentivize and train DAO members to take ownership of the protocol and how to handle general reluctance to vote.

  • DAO has claimed proxy ownership of the lending pools through an on-chain vote and is currently snapshot voting to claim ownership of stkTRU and TRU smart contracts.


Thanks for this writeup!

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