Thank you Lior for bringing forward this thoughtful proposal! Following our call earlier today, I want to take the opportunity to put my feedback in writing, ensuring we all have the same information and clarity moving forward.
SafeDAO Treasury
First some general remarks to funding requests to SafeDAO, which are not specific to this proposal. Any funding by SafeDAO should consider the financial situation of the DAO.
The SafeDAO Treasury has been allocated in total 400M token with 50M token available right away. The rest of the 350M tokens is vested over 8 years (see “
Safe Token” and “
Treasury” in the SafeDAO Governance Hub). While these numbers seem substantial, we need to consider two aspects:
- The Safe token is currently non-transferable and therefore there is no price history
- The Safe Treasury consists 100% of its own native token. Referencing Hasu’s blog post, this can lead to misconceptions about a DAO’s real treasury valuation.
Given these points, currently any valuation of the SafeDAO treasury and allocating a budget is at least not straightforward. When it comes to specific funding asks in USDC, there is another hurdle – SafeDAO has no USDC in its treasury. USDC requests would imply that SafeDAO needs to sell SAFE for USDC first to then allocate them to initiatives. This should be part of a broader discussion around resource allocation and treasury management.
Resource allocation framework
On this note, in SEP #3 SafeDAO decided that before considering transferability and funding initiatives there should be a resource allocation framework in place. @pet3rpan-1kx made a suggestion with OBRA that allows SafeDAO to align first on strategies which initiatives to fund and which connect to the overarching goals (see constitution) while implementing checks and balances, such as a review period. It would be problematic to vote now on an initiative which might only be funded after transferability and which was approved before any resource allocation framework.
Safe Grants Program
Fostering a vibrant ecosystem is of the outmost importance for Safe and one of the constitutional goals. Therefore the Safe Ecosystem Foundation set up the Safe Grants Program committing 1M USD in grants and setting it under the governance of SafeDAO. It’s worth noting that the SGP does not allocate Safe token, but can be complimented at a later stage with retroactive token allocation. So for the time being, the Safe Grants Program is the best way to get initiatives funded.
For this proposal, I think there are two possible courses of actions, which can be combined:
- Consider revising the scope and apply for a maximum grant of 50k USD as a Safe {Growth} Grant. In total 30% of the wave 1 budget (approx. 150k USD) has been allocated to the {Growth} category.
- Alternatively or in combination at a later stage: apply for an initiative under the resource allocation framework, once SafeDAO ratified it and agreed on specific strategies and the transferability of the Safe token has been enabled.
I hope this breakdown clarifies things for everyone from a resource allocation perspective. Thanks again, Lior, for bringing forward this proposal and initiating this discussion. Exciting to see what you’re building!