This proposal should still not be up for vote.: because (i) the concerns shared in this thread have not been properly addressed in an amendment of proposal and (ii) the SAFE DAO requiremenfor treasury management have not been clarified yet.
The idea of establishing a core unit with broader competences beyond the joint Gnosis DAO <> Safe DAO treasury could severe consequences for the DAO. It raises the risk of increased opacity and loss of management control, which are critical issues that need careful consideration and deliberation. Many of the previous comments, esp. from 1kx, in this thread should be taken into account before allowing for a governance event or supporting this proposal.
The most critical points in my opinion are:
- Lack of treasury management KPIs or processes within the DAO
- Mixing different roles for the DAO in one single core unit
- Mandating a sole, global asset manager instead of specialized asset managers
- Inadequate pricing model
- Operational complexity, risking a delay in the implementation as happened with ENS DAO
1. Lack of treasury management KPIs or requirements
Before mandating a treasury manager, the DAO needs to establish its requirements for the general treasury management KPIs (e.g. runway needs from the treasury), the legal/risk frameworks, asset manager selection criteria as well as controlling procedures. Just like with the grants council, SAFE DAO could appoint experts within the DAO or outside of the DAO as with the grants program. Considering the grants program is managing a budget of $1M, a similar procedure would be appropriate given the DAO treasury is multiple sizes larger than this.
2. Mixing different roles for the DAO in one single core unit
From my experience in other DAOs, mixing the role of a treasury manager, protocol relations, and native token ops creates a conflict of interest and represents a thread of power struggles in a DAO. Having various collectives contributing to protocol relations can negatively impact the coordination and alignment within the protocol relations group, representing a thread of contributors running in different directions, losing ownership, accountability, and time to market.
3. Mandating a sole, generalist asset manager specialized ones
The treasury holdings require dedicated strategies and expertise for the various asset types from native token, crypto assets and stablecoins. In sophisticated portfolio management strategies there would e.g. a dedicated strategic decision for the split between SAA and TAA (long-term strategic asset allocation vs short-term tactical asset allocation).
Ideally, a top-level portfolio strategy should be decided on by the DAO and executed by specialists for the various topics: yield farming, staking, money markets, equities, venture investment, credit or lending including the portfolio-specific risk management with hedging, delta neutral strategies, and asset liability management.
Native token management including liquidity management, sensitivity analysis for token sales, and token rewards programs is of strategic relevance and should be mandated and monitored individually.
This would still allow for karpatkey to win all mandates when competing against other service providers.
4. Inadequate pricing model
Operational activities should not be compensated with a percentage of the SAFE AuM. And portfolio management activities should not be based before a strategy has been deployed and performed well. I strongly support the concerns raised by 1kx above.
5. Operational complexity, risking a delay in the implementation as happened with ENS DAO
For the execution of the legal framework and technical deployment, the DAO should define an appropriate process depending on its needs as a pre-requisite, before deciding on a mandate and “buying” a setup that might not be robust or matching the conviction of the DAO for future regulatory and technical resilience.