[Proposal 004] Hodl Finance DAO

Summary

After a progressive 2022 for Hodl Finance, but a turbulent year for the cryptocurrency market as a whole, the core contributors of the Hodl Finance community are proposing a new way of operating for the years the come. They are proposing to abandon the old "centralized" Hodl Finance model and establish the "decentralized" Hodl Finance DAO (decentralized autonomous organization).

The new Hodl Finance DAO will be specialized in market making and investing, with the goal of adopting a more collaborative and transparent approach to decision-making. This will be achieved by drawing on the collective wisdom and expertise of a diverse group of participants. In addition to improving decision-making, the DAO structure will also help to democratize access to financial markets and investment opportunities, making them more accessible to a wider range of people.

Overall, establishing Hodl Finance DAO represents a significant step forward for the entire community. It aligns with the decentralized nature of cryptocurrency and positions Hodl Finance for success in a rapidly evolving market. The core contributors of the Hodl Finance community are confident that this change will lead to greater sustainability, resilience, and overall performance in the long term.

The process

In order to establish Hodl Finance DAO, research has to be done and decisions have to be made by the community. For the first quarter of 2023 the core contributors of the Hodl Finance community will be focusing on establishing the DAO and proposing all the important aspects to the community to make the DAO a realisation. This first proposal outlines the general structure of what this process will look like.

One key step in establishing the Hodl Finance DAO will be setting up a special purpose trust in Gibraltar. This trust will give decision-making power back to the token holders and will not involve any liabilities for them. Along with the trust, a constitution and manifesto will be introduced to outline the specific rules and foundations of the DAO. This will include information on the socially accepted rules, law-enforced rules, governance structure, decision-making processes, market making and investment processes, and overall goals and objectives of the DAO.

As part of the establishment of the decentralized autonomous organization (DAO), the current $HFT token will be phased out and replaced with the new $HFD token including new tokenomics. The new $HFD token will operate on the Ethereum blockchain. To facilitate the transition, old token holders will receive a fair airdrop of the new token. The introduction of the $HFD token will bring more flexibility and eliminate the old reflection mechanism. It will also establish a bonding treasury, enabling a continuous pre-investment round open to anyone.

If the community decides to create the DAO, the proposed ecosystem will be structured as shown in the attached image. To fully establish this ecosystem, the community will need to vote on various aspects of it, including:

• Proposal lifecycle; • The DAO legal structure (special purpose trust); • Ecosystem; • Tokenomics.

The core contributors of the Hodl Finance community believe that these steps, including the establishment of the special purpose trust and the introduction of the $HFD token, are crucial in establishing a strong foundation for the DAO and ensuring its long-term success. To discuss further progression and establishment of the DAO, a forum for the community will be set up to engage in.

Objectives

• Creating a transparent ecosystem for market making and investment activities; • Decentralizing control and reducing reliance on a centralized intermediary; • Increase accessibility for a wider range of investors and allow them to benefit from the success of the DAO; • Ensuring that the voting power resides with the token holders, where it belongs.