Summary

Discourse link: here

As the state of the DAOs grow within the decentralised economy and operations become more complex, so too does the need for developing governance frameworks that allow for a delegation of authority to carry out certain DAO functions (and the acts incidental to it, usually accompany it, or are reasonably necessary to accomplish it) to specialists while ensuring that ultimate authority remains vested in the community. Treasury management is one such function. Effective treasury management is necessary to increase the economic runway for DAO projects, to ensure a DAO has the liquidity it needs to manage its day-to-day business and to enable a DAO to achieve its long-run strategies and objectives. Similarly to how the Growth Fund was deployed for payments to Service Providers, Advisors, operational expenditures etc., the Treasury Management Fund will be used to deploy strategies to improve the Tracer DAO treasury’s financial position.

This proposal, if successful, will implement a Treasury Management Framework that establishes a ‘functional sub-DAO’ (the Treasury Management Fund) to be managed by the Treasury Management Team within a limited scope of authority and subject to the joint oversight of an investment committee (the Treasury Management Council) and the Tracer DAO community. The Treasury Management Team will be given the authority to deploy capital allocated to the Treasury Management Fund according to its community proscribed mandate in a manner that maximises capital efficiency and risk-adjusted growth.

Treasury Management Framework

This Treasury Management Framework Proposal seeks to create a Treasury Management Fund (TMF), to be established as a 3/5 multisig held by the (i) Treasury Management Team and (ii) two independent third-party signatories.

The objective of the Treasury Management Fund shall be to:

1. maintain a strong fiscal position for Tracer DAO operations;
2. and, subject to that, to support the growth of Tracer DAO by maximising risk-adjusted returns and optimising capital efficiency.

The Treasury Management Fund will be managed by the Treasury Management Team subject to the oversight of the Treasury Management Council. Because Tracer is a community-led DAO, in all cases and at all times, the Treasury Management Fund (and related bodies) will operate in accordance with the Treasury Management Fund Remit (TMF Remit), as confirmed and amended, from time to time, by community vote.

Treasury Management Team

The following have been nominated to serve in the day-to-day management of the Treasury Management Fund:

Treasury Management Team member	ETH address
Raymond (Co-founder) of Mycelium	0x131ddFd1DC9133077C72800C60072374cF6C87Fb
Dion Chu (core-contributor/advisor) of Tracer DAO	0xA7c42330f96c158513c98B73989aE37aC8456fA5
Billy Welch (core-contributor) of Mycelium	0x6BCAbF9f00F5583d38c2F30eF31f03B6bD9C9A11

Collectively, these parties would comprise the Treasury Management Team (TMT) and will serve a twelve (12) month term, subject to confirmation/renewal by the community. The Treasury Management Team will be responsible for monitoring the state of the DAO’s finances to ensure that the DAO has sufficient liquidity to meet its operational needs and manage the Treasury Management Fund to optimise risk-adjusted returns subject to the DAO’s operational needs and in a manner consistent with its community-proscribed mandate (TMF Remit). Each member of the Treasury Management Team will hold a key to the Treasury Management Fund multisig.

The following have been nominated to serve as independent third-party Treasury Management Fund signatories, who will serve a twelve (12) month term, subject to confirmation/renewal by the community:

Independent Signatories	ETH address
Chris Berg (Co-founder) of RMIT BIH	0x219BaD06180F4024A06C372d754E882D175Df098
Sinclair Davidson (Co-founder) of RMIT BIH	0x06187EAA4EF0891571F0a78a2DDEf0d291555E09

Collectively, these parties will be referred to as the Independent Signatories. Each Independent Signatory will hold a key to the Treasury Management Fund multisig and be responsible for reviewing and approving Treasury Management Fund transactions in a timely manner.

Treasury Management Council

This proposal also seeks to establish a Treasury Management Council (TMC) comprised of the Treasury Management Team and two independent council members. The Treasury Management Council will have the authority to decide on certain Treasury Management Fund policies and matters that require a heightened level of scrutiny but fall short of requiring a full community vote. The members of the Treasury Management Council are appointed to twelve (12) month terms, subject to confirmation/renewal by the community. Decisions will be made by a simple majority.

The Treasury Management Council will be responsible for:

1. reviewing and monitoring Treasury Management Fund performance;
2. setting policies to mitigate risk (including, but not limited to strategy risk, market risk, smart contract risk, counterparty risk, legal risk, and token exposure risk);
3. set and monitor risk limits and concentration limits; and
4. whitelisting protocols and strategies available to the Treasury Management Fund,

subject in each case to its community-proscribed remit (TMF Remit).

The Treasury Management Council will also deliver a quarterly report, uploaded via Discourse, reporting on:

1. the overall performance of the Treasury Management Fund;
2. portfolio composition and risk assessment; and
3. material changes to Treasury Management Fund policies.

The following have been nominated to serve as independent council members for a twelve (12) month term, subject to confirmation/renewal by the community:

Independent Signatories	ETH address
Chris Berg (Co-founder) of RMIT BIH	0x219BaD06180F4024A06C372d754E882D175Df098
Sinclair Davidson (Co-founder) of RMIT BIH	0x06187EAA4EF0891571F0a78a2DDEf0d291555E09

Collectively, these parties will be referred to as the Independent Council Members. The Independent Council Members shall be available to meet and discuss policies as needed, attend Treasury Management Council quarterly review meetings, and approve the TMC quarterly report to the community.

Treasury Management Fund Remit

If successful, this Proposal will implement the Treasury Management Framework described above, which includes the establishment of the Treasury Management Fund, and delegates authority to the Treasury Management Council and the Treasury Management Team to carry out the Treasury Management Framework objectives, subject to a TMF Remit as confirmed and amended, from time to time, by community vote.

To achieve this objective, this Proposal seeks the following remit (TMF Remit V1) to instate the Treasury Management Framework:

1. Scope of Remit — The transfer of Tracer DAO’s Visor LP position, 27,407 tToke position, 42.55 ETH and 2.77 WBTC received in consideration for proposal 14, 1,300,000 DAI (or other stablecoin), and 100,000,000 TCR to the Treasury Management Fund multisig to be deployed subject to the following constraints:

   1. exposure to tokens (other than tokens transferred from Tracer DAO by this remit or received as staking or farming reward, or exposure arising from liquidity pools) will be limited to TCR and stablecoins approved by the Treasury Management Council;
   2. concentration risk for each protocol will be limited to 33%, subject to more restrictive (but not expansionary) limits set by the Treasury Management Council;
   3. maximum gross leverage ratios of 200% (across the fund as well as per position); and
   4. all tokens to remain on Ethereum mainnet and Arbitrum.

2. The Treasury Management Council is directed to:

   1. set policies and procedures to monitor and manage risk (including, but not limited to strategy risk, market risk, smart contract risk, counterparty risk, legal risk, and token exposure risk);
   2. determine and whitelist acceptable strategies, vaults, farms, and protocols etc. subject to appropriate and reasonable risk assessments;
   3. deliver a quarterly report, via Discourse, that provides a performance and risk assessment, as well updates on any material changes to risk guidelines and policies set by the Treasury Management Council;

   in each case, subject to the scope authorised in this remit.

3. The Treasury Management Team is directed to optimise capital efficiency and maximise risk-adjusted returns (and delegated authority to carry out the acts incidental to it, usually accompany it, or are reasonably necessary to accomplish it) subject to the policies and guidelines of the Treasury Management Council and the scope authorised in this remit.

4. The Treasury Management Fund assets are at all times subject to redemption by Tracer DAO as needed for operational expenditures. Any funds so redeemed for may be remitted back the Treasury Management Fund without further proposal.

The Treasury Management Team and Treasury Management Council are directed to reference the table below for further guidance on the scope of authority authorised under this remit.

Decision	TMT	TMC	Governance Proposal
Amendments to this framework	------	------	x
Approve initial and any additional capital allocations to the Fund	------	------	x
Whitelist investable tokens (non-stablecoin)	------	------	x
Set maximum concentration/risk limits for each (non-stablecoin) investable token	------	------	x
Approve L1s and L2s whitelisted for cross-chain bridging of any assets (if any)	------	------	x
Approve maximum leverage ratios across the Fund and per position	------	------	x
Anything else not listed below and not reasonably required to fulfill TMC duties	------	------	x
Whitelist investable defi protocols	------	x
Whitelist investable strategies (e.g. lending, liquidity pools, strategy vaults, arbitrage)	------	x
Determine risk limits for each whitelisted strategy (e.g. limits to impermanent loss for LP, protocol risk limits for each defi product)	------	x
Determine concentration limits (protocols and strategies)	------	x
Allocate and rebalance fund subject to Community and TMC imposed constraints	x
Actions incidental to defi yield-farming/staking (e.g. claiming rewards, swapping rewards for stablecoin, voting)	x
Actions incidental or reasonably necessary to carry out whitelisted strategies and vaults	x
Necessary actions to safeguard Fund assets, prevent exploits, or respond to security breaches	x

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Variation and Termination

The Independent Council Members, the Independent Signatories, and the Treasury Management Team acknowledge that, if engaged, the DAO may terminate or vary its engagement in accordance with:

1. future Proposals and performance;
2. a material breach of any term of the Treasury Management Framework which breach is not capable of being remedied or (if such a breach is remediable) fails to remedy that breach within 10 days of receipt of notice from the DAO in writing to do so;
3. any repeated breaches of the terms of the Treasury Management Framework in such a manner as to reasonably justify the opinion that its conduct is inconsistent with it having the intention or ability to give effect to the terms of this agreement;

Termination of the Proposal shall not affect any of the parties’ rights and remedies that have accrued as at the date of termination. Furthermore, any termination of this agreement shall not be effective unless the agreement either expires, all things required to be done by the Proposal are completed or it is terminated by a further proposal of the DAO.

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Conflicts of Interest

In the context of the Tracer project, conflicts of interest include:

1. Existing Service Providers who are Related Parties; and
2. Existing (vested and unvested) holdings of TCR tokens.

The Treasury Management Council wishes to declare the following conflicts of interest:

1. Ray Mogg is a Co-founder of Mycelium, an existing Tracer DAO Service Provider;
2. William Welch is a core-contributor at Mycelium;
3. Dion Chu is an Advisor/core-contributor to Tracer DAO, and manages private funds that does not currently, but may in the future, invest in cryptocurrency;
4. Chris Berg is a Co-founder of RMIT Blockchain Innovation Hub, an existing Tracer DAO Service Provider (Academic Advisor); and
5. Sinclair Davidson is a Co-founder of RMIT Blockchain Innovation Hub, an existing Tracer DAO Service Provider (Academic Advisor).

Note: The remainder of this proposal did not fit within the proposal character limit on Snapshot. Please see Discourse link attached at the top of this proposal to view the rest of the proposal. If this proposal is successful, the remainder of the proposal on Discourse also applies.