LIP-27: Fund Manager Implementation & Portfolio Strategy

Authors Eliph, Ani

Summary

Following the structural changes introduced in LIP-26, this proposal outlines the implementation process for appointing a dedicated fund manager to oversee the Portfolio Sub-DAO. It also defines the fund manager's responsibilities, accountability mechanisms, and initial portfolio allocation strategy. The LIP includes a community vote on the fund's risk distribution between safer and riskier asset classes.

Abstract

This proposal initiates the next phase of the Portfolio Sub-DAO by:

• Launching a search for a qualified fund manager.
• Defining community governance over the fund manager's term and accountability.
• Setting clear rules of conduct and transparency expectations.
• Proposing an initial portfolio allocation split (community vote to determine exact breakdown). The appointed fund manager will be responsible for all high-risk asset transactions under the portfolio sub-DAO treasury and will operate under strict transparency and ethical guidelines. The community retains control through scheduled evaluations and voting and a public-facing communication structure.

Motivation

With the council dissolved as per LIP-26, a single fund manager model requires clear operational guidelines and an onboarding process. To ensure proper execution and alignment with the community's goals, this proposal provides:

• A transparent hiring process.
• Performance review and termination procedures.
• Ethical safeguards around asset trading.
• A preliminary portfolio allocation strategy subject to community approval.

Specifications

Fund Manager Search Process

• Screening: The Lizard Labs contributors will open applications and conduct an initial screening for qualified candidates.
• Visibility: The search will be advertised publicly via official channels to ensure transparency and attract quality applicants.
• Final Selection: The community will vote to approve the fund manager from a shortlist (estimated 3-8 candidates) provided by the team of reasonably qualified applicants.

Fund Manager Responsibilities

• Maintains full control over portfolio investment decisions, including buy/sell decisions. Will adhere to allocation strategy decided by the community.
• Must announce all trades after execution, never before in a holder-only Discord channel.
• Must provide quarterly updates on portfolio performance, market outlook, and activity logs.
• Must be personally doxxed and legally accountable to the Lizard Labs foundation.
• Preferred: Discuss market trends and engage with holders in a designated private channel.

Accountability

• Term: 6-month epochs, as previously established.
• Term Review and Transition: At the 5.5-month mark, a community vote will decide whether the fund manager should be retained for another term. If the manager is NOT retained, new candidates will be sourced while fund operations are paused and current positions are exited. A 2-month window for new candidate selection will begin for active management.
• Doxxing: The fund manager must dox privately to the Lizard Labs team prior to assuming the role to ensure recourse in case of misconduct or legal action. The fund manager must provide access to actively traded funds upon any relevant governance changes from the community (including allocation changes, fund manager changes, or other organizational adjustments) and must never withdraw funds for any personal use.
• Transparency: Any attempt to front-run trades or abuse access will result in immediate removal and legal consequences.

Initial Allocation Strategy Vote

Upon approval of this LIP, the community will vote between the following two portfolio allocation strategies:

• Option A
  • (Conservative): 80% in safe, staked blue-chip assets (ETH & BTC).
  • 20% in high-risk assets (memecoins, NFTs, etc.).
• Option B (Balanced):
  • 50% safe assets (ETH & BTC).
  • 50% higher-risk, higher-upside opportunities.

The selected allocation will guide the fund manager’s strategy for the next 6 months. Reallocation strategies can be proposed in future LIPs as needed.

Rationale

The Portfolio Sub-DAO needs forward momentum in liquidating and managing treasury assets responsibly. This LIP ensures:

• Operational Clarity: The fund manager role is well-defined and bound by safeguards.
• Community Oversight: Mid-term votes and trade disclosures create transparency without hampering execution speed.
• Ethical Protections: By prohibiting pre-trade disclosures, only allocating short-term tradable assets to the manager, and enforcing doxxing, risks of misconduct are significantly reduced.
• Flexible Allocation: A portfolio split vote gives the community control over risk appetite.

Conclusion

LIP-27 initiates a structured and transparent approach to treasury management. With a vetted fund manager, clear ethical boundaries, and a democratic allocation vote, the Portfolio Sub-DAO will be positioned for both security and growth.