HumanDAO Treasury Management - DeFi Utilisation

Summary:

This proposal aims to combine several strategies that will leverage the HDAO treasury to:

1. Diversify the Humandao revenue streams through DeFi protocols, making us less reliant on P2E revenue streams

2. Leverage our raised capital to grow funds for future development & investments

3. Provide the HDAO treasury exposure to other ecosystem tokens through DeFi

A total of $1.5M USDC is being proposed for DeFi allocation, spread across 2 strategies to minimize risk factors such as smart contract hacks. Only strategies with low risk of liquidation will be selected and the main focus will be earning yield on our stablecoin balances.

Abstract:

The main purpose of this proposal is to put the HumanDAO treasury funds to work and begin generating yield upon it. Currently the treasury has around $2.65 million in USDC, as this is not being utilized for yield generation, we are missing out on a considerably sized revenue stream. As this is treasury money, it is imperative that the DeFi protocols we utilize are as risk averse as possible. With this in mind, this proposal only scopes low risk strategies that pose low risk of liquidation.

The strategies suggested here are set up with a 1-2 year time frame in mind. However we want to remain flexible with our assets and will avoid any lengthy lock up periods where possible, especially ones which include speculation of assets appreciating in price. This will mean we will be able to pull our stablecoins from the protocols at any point in time, if we wish to reinvest them into other opportunities, such as new & emerging P2E games.

The $1.5 Million fund is planned to be split into 2 separate strategies. Those strategies will be managed using a gnosis safe in combination with enzyme protocol where it makes sense.You can see the value allocations below. A sub-treasury for this DeFi strategy will be created that will hold funds for strategy 2. In the future, it is proposed that everything will be run through an enzyme vault, as this provides security from the multi-sig as well as flexibility in terms of who can manage the assets. The multi pool strategy is proposed for now until Enzyme can handle investing in early-stage, less liquid assets (planned for next release).

DeFi Diversification (Treasury allocation broken into 2 strategies)

• Strategy 1 - Enzyme secured DeFi strategy. Up to $1M (Curve, Convex & Yearn)
• Strategy 2 - Non-enzyme hosted protocols / reserve fund for early-stage strategic projects and protocols. $500K

Strategy 1: Through Enzyme’s trader delegation and risk management features, this strategy allows a safe environment for the funds to be stored and managed with 24/7 oversight over reporting and performance. This pool will be used for DeFi farming, with rewards also being provided in the form of curve & convex tokens, which will open up the DAO’s treasury to the associated ecosystems.

Strategy 2: This strategy will be allocated towards DeFi projects which enzyme does not yet have access/integrations to until it’s next big release (Eve). This strategy will allow us to remain flexible in our approach and capture emerging opportunities within the DeFi space. Later in the year, we can aggregate all funds for maximum transparency towards our stakeholders.

Budget:

DeFi Diversification: Strategy 1 (Enzyme Finance) = Up to $1,000,000 USD Strategy 2 (DeFi 2.0 & reserve fund) = $500K USD

View the full proposal here: https://forum.humandao.org/t/humandao-treasury-management-defi-utilisation/147

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