BIP-83 (A): ETH to USDC Conversion

Note: This snapshot votes only on Part A of the full "BIP-83: A Holistic Update to Botto’s Economy". There are 6 total votes for BIP-83, see the other votes on the main snapshot page.

Summary

The proposal aims to enhance Botto's financial sustainability and operational flexibility while reducing exposure to market volatility so the DAO Operators can focus on execution of the ongoing evolution of Botto in this new era of AI.

Direct conversion of ETH to USDC to fund USD/USDC operational expenses is favored over collateralized borrowing for 2 main reasons:

1. Eliminates price risk considerations and additional costs from interests
2. ETH will continue to be the source of future revenue

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Proposal Specification

1. Primary Reserve (3-month avg. spend)
   1. The DAO treasury will maintain a USDC balance covering at least 3 months of operational expenses
   2. The balance will provide immediate liquidity for DAO payroll, vendor costs, travel, and other USD-denominated expenses
2. Extended Reserve (up to 12-months)
   1. Operational flexibility to convert additional ETH based on market conditions at the Treasury Working Group’s discretion
   2. Provides strategic liquidity and operational buffer against ETH volatility
   3. Reduces pressure to OTC $BOTTO, maximizing optionality to onboard stewards aligned with Botto’s long-term success
   4. Current ETH (~$2.8M) and 12 month burn ~$1M, so approximately 35% of ETH reserve. Note this is to have optionality and not to actively seek to have a 12 month reserve

Conversion Triggers: Monthly assessment of USDC reserves vs rolling 3 month expenses Execution: Convert ETH to USDC when reserves fall below the rolling 3 month minimum Discretionary Conversions: Minimize conversion frequency while maintaining adequate USDC coverage (not trying to time the market)

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📚 Read the full proposal: https://forum.botto.com/d/120-bip-83-a-holistic-update-to-bottos-economy Discussion of holistic proposal: https://discord.com/channels/829636834371960842/1418629635100643358 Discussion of Part B: https://discord.com/channels/829636834371960842/1418596541672984728