TrueFi & Wallfacer Labs: Chapter 3


June 30, 2024 is the end of Wallfacer Labs’s second engagement with TrueFi DAO. This post is intended to open a discussion about ongoing priorities for the DAO and propose Wallfacer’s scope of work for the second half of 2024.


When our second scope of work with TrueFi began in January 2024, TrueFi was in a much more nascent place than it is today.

The first half of 2024 has seen:

  • The onboarding of new partners, namely Cicada Partners with the first pools opening just earlier this week.
  • Expansion of TrueFi to Arbitrum alongside a grant supporting Cicada Partner’s lines of credit.
  • Proposals around new initiatives, namely Trinity.
  • Growth of existing products (Adapt3r’s UST fund)
  • We have also improved our coverage in mainstream media with all of our announcements getting covered by major crypto news publications (examples: Coindesk, DL News, Cointelegraph).

Those are just the highlights and our 1H 2024 recap goes into greater detail outlining what Wallfacer did in the first half of this year.

While we do not fixate on token prices, it is worth noting that YTD, TRU has been a top performing RWA token. With this slate of initiatives finally beginning to take shape, the market seems to be noticing. Excluding Ondo, TRU is the best performing RWA asset across all the majors that we monitor. Of course, this is not predictive of the future (the whole market could crash tomorrow), but it is an encouraging data point.

(Screenshot as of June 6, 2024 around 5pm EST)

With the first half of the year coming to a close, we want to propose what’s next for TrueFi.

2H 2024

  1. Launch and support Index Vaults, enabling diversified pools on TrueFi that span multiple Lines of Credit (“ALOCs”) and external DeFi pools
  • Index Vaults are a fund of fund-like product where onchain asset managers can allocate into other DeFi and onchain opportunities.
  • As multiple new lines of credit launch over the coming weeks, we anticipate that lenders will want diversified and/or actively managed exposure across multiple borrowers. Cicada Partners has expressed interest in launching such an Index Vault, as they mentioned in the Final Thoughts section of their post here.
  • We expect that a primary yield source for managers running IV strategies will be to invest into other TrueFi products like lines of credit, but IVs can also invest into ANY ERC-4626 compatible DeFi protocol.
  • This opens up an entirely new vertical for TrueFi technology and new possibilities for onchain composability.
  1. Continue TrueFi’s multichain expansion
  • In 1H 2024, we helped to deploy TrueFi lines of credit and periphery contracts to Arbitrum. As we continue to work with Cicada, borrowers, and other ecosystem partners, we expect to deploy more TrueFi product lines (Asset Vaults, Index Vaults, Credit Vaults) to Arbitrum and/or additional networks.
  • Current explorations include ZkSync, Base, and Bitcoin L2s. One of the reasons we are a bit slower with expansion is that we like to identify concrete, sustainable opportunities or partnerships from Day 1, before deploying.
  1. Deliver customer-driven enhancements on current products
  • Support Lines of Credit commercialization and release LOCs with “dynamic interest curves”
    • Based on both the feedback from Cicada and contributions from @TylerEther, we have a scope of work that enables dynamic interest rate setting and credit limit setting on lines of credit. We intend to implement these changes and drive the process to get ALOC 2.0 audited and deployed.
  • Improve UX for lenders and managers with new controllers and/or front-end features
    • We have heard that enabling lenders to signal intents to withdraw funds could improve liquidity management for both lenders and borrowers. We expect to deliver enhancements related to liquidity management based upon feedback we receive from lenders, borrowers, and Cicada following ALOC launches
    • Additionally, we are able to implement enhancements for vault permission management and KYC integrations if such features are requested by portfolio managers on the protocol
  1. Website Improvements
  • Add support for stkTRU in the new app.
  • New marketing page for TrueFi based on new language, value propositions, and current use cases
  1. Improve documentation for asset vaults, lines of credits, and index vaults.
  • Our products are still not at a state where managers or borrowers can easily onboard without support. Now that we have much more active user feedback, we are able to craft our documentation based on actual questions.

This is on top of our existing and ongoing responsibilities that we do not normally break out, but include:

  1. Ongoing general support for managers
  • We have weekly check-ins with both Adapt3r and Cicada and would do the same for any new managers as well.
  • We regularly attend business development calls, help on collateral or governance opportunities (e.g., TrueFi – tfBILL STEP Application), and speak with prospective managers and partners.
  • We have increased the quality of posts on X and see strong engagement for our posts. With the recent announcement, we’ve also revived both the Medium and Substack accounts.
  1. Rebuilding community
  • As we have seen other communities migrate away from Discord, we would like to do the same. Right now, we also have a Telegram chat that is filled with a fair bit of spam, but is still much more manageable than Discord.
  • We may also consider a Farcaster channel
  1. Support TrueFi Foundation board and governance initiatives
  • Continue to provide assistance to community members who wish to submit onchain proposals, but are not familiar with Tally and smart contracts

Disclaimer: Everything above is subject to input and change. We do use this as our internal roadmap to guide what we work on, but if/when new things emerge, we often make the decision to work on the most important, high impact projects, driven by what users and the community ask for.


6 months, beginning July 1, 2024 and ending December 31, 2024


22,000,000 TRU with 30% paid upfront and the remainder streamed over 6 months beginning July 1, 2024.

Next Steps

This post requests comments and will remain open to comments for 2 weeks. We plan to move this to Tally on June 20th.

In that time, we encourage discussion about what the highest returning actions you think Wallfacer (or other/additional teams) could do for the DAO over the remainder of 2024.

Following this feedback period, we will move the proposal to a TFIP on-chain vote.


The information presented herein is being provided to you by Wallfacer Labs, or one of its affiliates (the “Provider”) for information purposes only. Neither Provider nor any of its affiliates, nor any of their respective affiliates’ directors, officers, managers, employees or representatives (the “Provider Parties”) makes any representation or warranty, express or implied, with respect to any of the material or information contained herein. None of the Provider Parties shall assume or otherwise have any responsibility or any liability whatsoever to you or any of your affiliates, or any of your or your affiliates’ respective directors, officers, managers, employees or representatives resulting from the use of the information and material contained herein.

The information provided herein does not, and is not intended to, constitute legal, financial, or tax advice; instead, all information, content, and materials available herein are for general informational purposes only. The information provided in this presentation is supplied in good faith based on information believed, but not guaranteed, to be accurate or complete.

This information does not constitute an offer to sell or a solicitation of an offer to buy any asset. In considering any prior, pro forma performance or track record information contained herein, you should bear in mind that past performance is not indicative of future results. Past performance does not guarantee future results; current performance may be lower or higher than performance quoted.


Wallfacer did some great work, especially as the market is picking up. Glad to see TrueFi on Arb with Cicada.

With regards to the DAO plans, do you have any sense of the direction of how Wallfacer would want to see the DAO diversify in its service providers? How will you support the processes to open up competitive bidding and parallel development?

Without parallel development and diversification of service providers, we would expect the DAO to unfortunately fail due to lack of resilience and organizational process. A CAO is not a DAO, and I would hope WallFacer has a plan to support these initiatives and understand the issue.

Defining Performance Benchmarks
Have you considered preparing a formal statement of work with defined deliverables that could be “checked off”? All major DAOs are moving to more professional operations, including defined statements of work with performance clauses in their compensation.

I see payment terms in this proposal but the payment terms don’t seems to have any means of calibrating counterparty risk. As proposed, the only recourse afforded to the DAO is a binary choice – terminating the stream. This would be a bad outcome for either party, it is generally better to provide a spectrum of remedies that avoid conflict. One way to do this is to partition some incentive to be tied directly to performance.

Performance Based Compensation
Would it make sense for a portion of the comp moved and tied to calibrated to the performance of particular objectives? Right now DAO has no means on incentivizing exceptional performance, only punishing for non performance n a universally damaging manner. Of course ant negative outcome is unlikely considering Wallfacer is a steady supplier to the DAO. I think having a portion of compensation tied to performance is standard fare. This could look like having the foundation board or TrueFi holders vote at a later time to approve a specific compensation package for meeting defined benchmarks. For example, a TRU unlock if TRU price reaches .40 or other metric that can be tied directly to WallFacer Performance (TVL on new chains, New Partners, etc.)

I wrote previously about this to Wallfacer in support of the DAO in November 2023:

It is also worth noting the ask has been significantly increased and is in excess of what even the best compensated teams receive, even at protocols such as MakerDAO, which are cash flow positive. The request is quite substantial (approximately 8,000,000 USD per annum for what appears to be a 6-8 headcount team). With an ask like this, it may be worth considering some reasonable risk mitigation to protect both sides. This is a significant sum on the table; an ounce of planning is worth a pound of cure.

  • Will there be some formal documented engagement ?

  • Do you have projections on headcount ?

  • How does this budget request calibrate based on the prior asks?

  • What recourse would the DAO have if midway through the term it is dissatisfied with the performance of Wallfacer? Is the only recourse outright termination? What does this performance evaluation process and term look like?

Comment Term and SOW Composition
It may be worth noting, 13 days for a comment term feels quite short. Usually on a ~$4,000,000 contract, I would hope to have at least a couple of weeks to reflect on fully fledged document, including concrete terms and a statement of work with explicit deliverables to provide meaningful feedback. Due diligence on something of this scale is rather challenging.

As composed, there is an absence of what Wallfacer will concretely deliver, how they will do so, and then how it will be measured and satisfactory receipt of the work agreed.

This ambiguity is evident on “2H2024” specifically for items 2,4,5,6.

I have also noticed a primary issue with the current operational relationship with Wallfacer is a misalignment of operational incentives. Wallfacer has not been incentivized to evaluate their own work and does not yet have an objective counterparty to do so.

It also has not provided a reflection or comment period to allow for a performance evaluation prior to a new funding round, and connect past work to concrete future promises.

Without this process of reflection and due diligence, it creates a (potentially unintentional) leverage scenario, but a leverage scenario nonetheless. Wallfacer may want to consider ways to remedy this issue in the current proposal down the line, even if this goes to a vote and passes as is.


We are very accepting and encouraging of new service providers.

If you have examples of how other DAOs have approached this process, I’d love to get educated. While we have seen places like AAVE run competitive processes for risk managers, I’m less familiar with successful examples of DAOs running campaigns to attract new core development teams.

He can speak for himself, but we’ve been supportive of working with @tylerether on his contributions to TrueFi. If his company and/or other teams would like to expand their scope with TrueFi in the future, we would welcome their proposals.

I disagree with the severity in which you define this, but agree that multiple (and in the future, entirely alternative) service providers would be a plus.

Can you share public examples of performance clauses at places like AAVE, Lido, or Maker? I’m glad to take a look.

If you look at our prior two engagements, we did have a much more formal statement of work in the first one (modeled off of BGD’s work with AAVE) and that worked fine at that time. In our second engagement we softened that and in hindsight that was the right decision. The highest impact things we worked on in the first half of this year were new opportunities that were not apparent when we drafted that proposal in December 2023. Had we stuck rigidly to that scope, we would be in a worse off place today.

This time around, while we might not have clear “check boxes”, I think we are actually pretty clear about what we are going to work on with the disclaimer that if a higher return opportunity presents itself, we will go after that.

I think the fact that we are accepting compensation in TRU is strong alignment and (in a roundabout way) acts as performance based compensation.

I actually don’t believe it is that standard across most major DAOs. At the very least, I have not seen this practice previously (outside of I think Gauntlet, which is in a different category of service provider than we are).

Yes, all of our engagements are formalized with a legal agreement between Wallfacer Labs and the TrueFi Foundation. It’s TrueFi Foundation’s agreement so it’s at their discretion to share the templated version publicly, but it’s fairly standard.

Governance can end our Sablier stream at any time. As an alternative to “outright termination”, something like what AAVE did with Llama could be an option to cancel and replace the stream.

There isn’t a formal process today other than DAO members effectively voting on our performance at each of these proposals. We do have an active chat with the foundation board members, but it’s a bit more operational in nature than it is any kind of check in process.


TrueFi has been in an awkward state for quite some time, having to refind our footing following the collapse of the industry’s credit markets. Rebuilding TrueFi’s markets is a complex task, requiring the execution of a variety of skill sets.

Wallfacer Labs is doing a good job at this. They’re maintainers of TrueFi’s underlying tech stacks, leading the development of the web app, leading the development of the protocol, building Trinity to increase the utility of TrueFi portfolio tokens, building and maintaining partnerships, and leading marketing efforts through their podcast and publications.

It’s hard to put a dollar value on Wallfacer’s work as it takes time to realize the full value. It’s also hard to measure performance and outline concrete deliverables when TrueFi itself is at a bit of a standstill. It’s easier to measure success when the protocol itself has traction and is moving in a clear direction.

I support Wallfacer’s roadmap for H2 2024. Customer success by having regular check-ins with partners and improving TrueFi’s products based on their input is key to building strong relationships. Deployments to other L2s can allow TrueFi to capture grants like you’ve done so with Arbitrum, in addition to new users and potential partners. Index vaults are great to tie various products together to make it simple to onboard a variety of depositors.

Wallfacer has also been supportive of opening up development with other teams, such as working with me to allow for the integration of products that I’ve developed under my project, Adrastia. This is something that I’ve yet to publicly disclose, but this effort has been progressing behind the scenes and a proposal with more information will be made in due time.

Overall, I support Wallfacer’s proposal and thank the team for their commitment to advancing the protocol.


Hey R.,
Thanks for taking the time to write this reply.

I will just touch on a couple of the more practical points, but generally glad to hear you guys are supportive of growing the org. I would say that the best time to plan for the future is when things are going well, so now may be a bit of a breather to do so.

Performance Compensation Comparables

You asked about how others are structuring their compensation. I think one of the best examples was MakerDAO SES, which allowed for 20-30% of base comp calibrated at the 180 day Moving average. I believe CodeKnight is familar with this plan and could explain it to you. This was structured as a retention bonus, however, and one of its weaknesses is that it was not tied to specific benchmarks or a performance bonus. On the positive side, it was a fully transparent compensation model on a per headcount basis.

DAOs are moving towards more performance-based bonuses because of low ROI with open ended structures. From what I have seen, this looks more like a traditional contractor arrangement, for example, 20-30% performance bonus on base comp, but contingent on the achievement of specific benchmarks (and calibrated at a 180 day Moving Average). I wish I had more public examples, but this is not anything new, as I believe you have worked in more traditional environments as well.

TRU Deal Structure
You noted that TRU functions as a roundabout performance incentive, but in your 2024 update post, you also note the opposite – that the TRU price could crash at any point, and that this negative performance could be divorced from the work of Wallfacer. This is because TRU is a volatile asset and highly correlated with ETH. Claiming the positive performance of TRU as evidence of one’s own positive performance is a bit of a straw man.

There is also major risk in 100% of a core team’s compensation paid in a native volatile asset. It isn’t a great operational risk management strategy. If TRU tanks, the team also goes hungry and stops working, a compounding death spiral for the project, OR the DAO ponies up more money, and ends up doubly out while bearing all the risk.

What risk premium did you and the team choose to use on your base comp to account for the volatility of the underlying asset (TRU)? 30%? 40%?

At the core of the deal structure, my questions focus on why the fee increased when the team size and scope of responsibilities are relatively the same? As it stands, the DAO bears all the risk, despite Wallfacer now being sufficiently capitalized to bear some portion of the risk. One major improvement that could be made here – there is no quote in USD for the scope of work to understand how you are calibrating the performance bonus and the volatility of TRU. If you do want to go flat fee without a defined SOW, it makes sense to put in some basic risk measures against non-performance and the volatility of TRU.

Sample Structure

An example structure that could move in the right direction could be as basic as:

e.g. $4,000,000.00 12 Month- Total Contract Value

$1,000,000.00 * 180 day Moving Average USD/TRU (Paid Upon Completion of All agreed Benchmarks)
$1,000,000.00 USD Stable Asset Paid Upon Ratification
$2,000,000.00 USD Stable Asset Streamed, with Pre-defined Evaluation of Quarterly Benchmarks.

For example, if the team wants a higher TRU allocation, they can push the TRU compensation which is deferred and paid post-performance. Getting a higher TRU stake, also balance risks on the DAO side. This model above also ensures Wallfacer has sufficient working capital in USD equivalent to ensure operations in the event of an unforeseen TRU downturn.

Anyway, happy to see this moving ahead. We will check in about helping to support the evolution of the DAO. It looks like there could be some opportunities to design some frameworks and the like. We always welcome a chance to work together.


@WallfacerLabs, could you please share your thoughts on the DWF Labs proposal?

Your insights on this matter would be highly valued.

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I had a call with them and at this time, given our very strong liquidity, I do not see a reason to bring on a market maker. People are welcome to disagree.


Was building a conduit on MakerDAO something Wallfacer was working on?

Is this still in the pipeline for TrueFi?

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Still (kind of) in the pipeline. Something we’re very excited to work on, but from the last time we spoke with people from Maker on the topic of RWA investing via conduits the message was: “most work is stopped until the subDAOs”. Now is probably a great time to revisit this actually so thanks for the nudge!


It’s great to hear that you’re still invested in the idea. Revisiting it will hopefully lead to some exciting developments. Please keep us updated on the progress✌️



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6 months / 22 million TRU - that is nearly 4 million US Dollars for 6 months!

If 4 million dollars, Wallfacer needs to have hours of worktime and people and sub contractor list in significant detail. This not small money.

Otherwise cannot support.

I think we get quote for set of work from outside contractors. see if market price is even close. check if dao treasury beeing taken advantage.

in past Profile - Sanctus - TrueFi Sanctus talk about incentive pay and Profile - StrategoHoldings - TrueFi talk about expentidure control.

this proposal not either these.

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As we have already said:

Given the timing, I don’t think it would be possible to create a smooth offboarding to one or multiple new teams by the end of this month, but conducting a “call for service providers” is a great potential project for the board to take on over the second half of this year.

This is our third proposal with TrueFi and we have never broken out our work in that way. From our very first proposal:

We would love to hear from community members and token holders either now or during the scope of our next engagement if they believe there are higher impact things we could be working on for TrueFi. We often have conversation on pricing, but rarely do we get feedback of alternative things we could be doing for the protocol that would be the highest impact.

We regularly look at the market to get a sense of competitive pricing. Some of the most public references we use are


  1. BGD Labs + Avara (AAVE Labs) are roughly $15mm in total compensation between the two teams.
  2. I draw the distinction between BGD and Avara as, BGD is focused on day-to-day engineering work (still difficult) and future-proofing the protocol, while Avara is focused on the future developments (see AAVE 2030)

(2) Compound DAO

  1. AlphaGrowth provides BD/marketing services for Compound at a rate of 2.5mm/year (at time of voting)
  2. As far as I know, engineering and product work is otherwise done in-house at Compound Labs so we do not know how much that costs.

(3) Maple

  1. From their quarterly treasury reports, we can see Maple has has quarterly costs of about US$1.32m. This annualizes at $5.28m/year, but it is unclear to me if this includes token compensation in which it could be significantly higher. They have also recently increased their token supply (diluting holders) so tough to do apples<>apples here.

Ultimately, we believe two things. One, that we are doing multiple roles today that otherwise would require multiple teams. For example, compared to AAVE (which granted is far more mature than TrueFi), we are doing both the day-to-day work of working with users and customers, future proofing the protocol, supporting governance initiatives, and building for the future. We are also doing BD and marketing coordination for the protocol.

While we are, again, supportive of new service providers, I don’t expect the aggregate cost will be less or much less than Wallfacer.


Im in full support of @WallfacerLabs proposal


Since we began our engagement with TrueFi we’ve been particularly impressed with the Wallfacer team’s support, vision, and ability to execute.

As Credit Risk Manager on the platform we have worked in partnership with Wallfacer to support borrower needs, creating Lines of Credit. The team has partnered to work on a number of UX-related solutions to further improve the experience for both borrowers and lenders we’ve collectively experienced over the past few months.

We agree with the general premise that there should be a meaningful (20-30%?) performance component to compensation, but as a service organization it can be particularly hard to measure performance as NOT DOING something can be more important than DOING and the RIGHT decision can be to do something DIFFERENT. Crypto markets change fast and to overly pin performance based on a plan ascribed 7 months previously seems antiquated. As such, Cicada Partners are in general support of this proposal.


The proposal has been moved to Tally.


Specifically, voting begins at Saturday at 9:16am ET / 1:16pm UTC

And ends Tuesday at 3:03am ET / 7:03am UTC


Also just to clarify this since someone asked in a private channel… This grant will go 100% to lenders in Cicada’s pools on Arbitrum. This was not compensation for Wallfacer in any way.

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