SUMMARY

The Degen DAO (the “DAO”) Constitution (the “Constitution”) established a treasury (the “DAO Treasury” or “Treasury”) of assets owned for the benefit, use, and enjoyment of the DAO. This proposal sets forth the processes that will govern the Treasury.

DESCRIPTION

The proposal below defines the various aspects of the DAO Treasury and how it will be maintained. This includes, among other things, transferring pre-formation assets to the DAO Treasury, the maintenance of a multi-signature wallet, how non-digital assets will be held, and policies to assist the DAO with budgetary considerations.

MOTIVATION

This proposal is necessary to establish the processes for the DAO to transact and to ensure the financial health and well-being of the DAO.

TECHNICAL DETAILS

Section I. Pre-DAO Formation Assets

The Knights of Degen and Steedz of Degen NFT projects maintained a community fund known as the King’s Purse (“King’s Purse”).

1. Digital Assets

The Kings Purse contained cryptocurrency and other digital assets. Upon ratification of the Constitution, the Community Council will work with the creators of the Knights of Degen NFT project to transfer assets from the King’s Purse to the DAO Wallet, defined below, as soon as practicable.

2. Non-Digital Assets

The King’s Purse also held certain non-digital ownership interests. Upon ratification of the Constitution, the creators of the Knights of Degen NFT project will work to transfer ownership of those assets to the DAO Treasury as soon as practicable.

3. Transfer Impracticable

In the event transferring any assets, digital or otherwise, is impracticable, the holder of the non-transferred asset must agree in writing that they hold the asset for the benefit of the DAO Treasury.

Section II. DAO Wallet

A multi-signature wallet was previously created using a Gnosis Safe to serve as the primary wallet for the Treasury (the “DAO Wallet”). The DAO Wallet will be managed by signers on the DAO Wallet (”Signers”).

Section III. Signers

1. List of Signers

The DAO must at all times maintain a public facing list of the Signers pseudonym and the ETH address associated with that Signer.

2. Authority of Signers

Signers may only act at the direction of and for the benefit of the DAO. The direction of the DAO must be set forth in a proposal adopted consistent with the Constitution.

3. Number of Signers

The DAO Wallet may have up to ten total Signers.

4. Execution by Signers

To execute any transaction, the transaction must be signed by at least three Signers.

5. Requirements of Signers

To be a Signer, an individual must hold at least one Knights of Degen non-fungible token.

The Signer must also disclose their legal name and a physical address to the DAO’s Director, which will be maintained in a list accessible only to the Director. These details will be kept confidential unless disclosure is required by applicable law.

Signers may, but need not, be members of the Community Council.

6. Election of Signers

To be a Signer, an individual meeting the requirements above must be elected by a majority vote of the members of the Community Council. If the individual being elected is a member of the Community Council, that individual may not vote on their own selection as a Signer.

7. Removal of Signers

A Signer may be removed by a majority vote of either (1) the Community Council, (2) the existing Signers, or (3) a Proposal adopted by the DAO. The individual being removed may not vote on their own removal.

Section IV. Holding Non-Digital Assets

The DAO Treasury may also hold non-digital assets for the DAO. These assets will be held consistent with the proposal approving the acquisition of the asset and applicable law. To the extent an individual or entity other than the DAO holds the asset on the DAO’s behalf, the individual or entity must agree in writing that they hold the asset for the benefit of the DAO Treasury.

Section V. Use of Assets

The DAO may authorize third parties to use or hold DAO Treasury assets. Such an arrangement should be in writing and indicate explicitly that the assets belong to the DAO.

Section VI. Budgetary Analysis for Proposals

Any proposal for consideration by the DAO that involves the expenditure of funds must include a Budgetary Analysis that analyzes the DAO’s current liquidity, the impact of the proposed use of funds, upcoming revenue, and upcoming expenses.

Section VII. Major Expenditures

Any proposal for consideration by the DAO that involves a major expenditure of funds (i.e. an expenditure that exceeds $25,000) must be approved and documented by the Director before the Proposal may be executed.

Section VIII. Accounting

The DAO must at all times maintain a public facing list of assets in the DAO Treasury. At least quarterly, the DAO must perform a reconciliation of assets to ensure the list is up to date.

Section IX. Treasury Allocation

To manage the risks associated with the volatility of ETH, the DAO Treasury should maintain both ETH and stablecoins/fiat. This will secure possible ETH appreciation upside but also reduce the downside. To accomplish this, unless the Community Council deems a delay necessary due to market conditions, the DAO should perform an analysis of current holdings and a rebalancing at the end of each month.

BUDGETARY ANALYSIS

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ARGUMENTATION

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AGAINST

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DAO VOTE

• Voting Details:
  • Because this is a DAY 0 Proposal, the vote will be open for 12 hours and be approved by a majority of votes cast during the 12 hour period.
  • Any holder of a Knights of Degen NFT through out the voting period on the Day 0 Proposals is eligible to vote.
  • Each holder of a Knights of Degen NFT is entitled to one vote per Knights of Degen NFT held.