[GIP-263] Treasury Rebalance

Author: nikitakle

Summary

This proposal suggests rebalancing the DAO treasury by swapping one-third of its ETH holdings (≈213.6 ETH) into USDC. At the moment, ETH represents the majority of the DAO’s assets. To ensure sustainable growth and predictable operational funding, the treasury should increase its share of stable assets.

Current Gearbox DAO treasury composition:

• ETH: $3.11M
• Stablecoins: $696.3K
• BTC: $413K

Assuming the current ETH price of $4,444, the sale of ~213.6 ETH would yield approximately $950,000 USDC. After this rebalancing, the treasury will maintain a healthier balance between volatile and stable assets, ensuring financial stability for contributor payments, grants, and operational expenses.

Motivation

• Diversify the treasury: ETH currently dominates the treasury structure, which increases exposure to market volatility.
• Increase stability: Converting a portion of ETH into USDC ensures stable liquidity for several months of operations and contributor payments.
• Simplify operations: Having more stable reserves makes payment and treasury management more predictable and efficient.
• Focus on growth: This is a practical operational step to strengthen the DAO’s financial stability during active team expansion and product scaling.

The Reserve Fund and other long-term assets remain unchanged.

Execution Plan

If this proposal passes, the DAO will:

1. Swap approximately 213.6 ETH (~$950K) into USDC.

   • This includes all free ETH from the Fee Guard wallet and a partial withdrawal from Lido.

2. Execute the trade via CoW Swap using a TWAP (Time-Weighted Average Price) strategy to minimize market impact.

3. Proceed only if ETH price remains within a -20% range from the current level during execution.

   • If ETH price drops by more than 20% before or during the swap, execution will be paused, and a new DAO vote will be required to confirm or adjust the plan.

4. Hold the resulting USDC within the Fee Guard multisig to cover operational and contributor expenses.

Outcome

This rebalancing strengthens the DAO’s financial foundation, ensuring stability and predictability for upcoming months of operations and growth. It is a straightforward operational step to maintain healthy treasury proportions and support Gearbox DAO’s continued expansion.