Adjust Treasury Performance Fee Structure


[DAO Discussion] Performance Fee Structure



Objective:

This post is to discuss a potential CMP to adjust the treasury team performance fee structure. Changing back to a performance fee calculated as it was prior to CMP 3 passing, while adjusting the backing value of any token where the protocol is owned by Volta Club such as UwU, to be the average price over a 90 day period

Community Interest:

  • I would like to see a formal proposal
  • I am not interested in seeing more
0 voters

High Level Details:

performance fee goes back to the old way, while adjusting the value of some tokens.

Provide Low Level Details:

*1- performance fee calculation goes back to be based on the backing price of Volta.
2- we adjust the value of tokens to be considered for backing price calculation as such:
2.1- liquid assets (such as BTC, ETH, SV, USDT DAI) to have the same value as the market price at the time of calculation (type a).
2.2- tokens of protocols owned by Volta Club or some potential seed investment to be calculated as the average value of the closing price (daily candles can be used) over a 90 day period (type b).
3- backing value = (sum(type a) + sum(type b) ) / circulating supply
4- performance fee will therefore depend on backing - HWM



Since a DAO Discussion is meant to introduce a proposal, not all information may be available at this stage. The discussion should be used to measure the community’s interest in what is being proposed. If the minimum requirements are met, it can be submitted as a Request for Comments.

We know how things could get interpreted different ways regarding cmp 3, therefore imo it would make sense to make an additional point regarding buybacks in some kind of way.
I think in the old system buybacks were mentioned somehow, maybe we can use this pattern again.

I don´t agree with: *1- performance fee calculation goes back to be based on the backing price of Volta.

I want to be same as now to be calculated with current price on the market. Like now we can see there is not any wave of new investors, because marketing is lacking. Price of volta is trading 3x bellow of backing price, because nobody is sure if they even bought now, real price will be sometime on same level as backing.

It´s nice to get paid cause of backing price, but if I as investor see “team says we are up 70%” and I cant take this profit because price is still lacking. I don´t see any reason why team will get paid and me as investor cant take backs profits.

This proposal doesn’t actually address the underlying issue with accounting. The reason assets like UwU pose an issue for accounting is because we own an amount that far surpasses the available liquidity for it. Taking the average over 90 days will still lead to a valuation much higher than its actual worth for our size.

I’d like to address a few points in your response. First, thanks for sharing your point of view, much appreciated!

Market price doesn’t always show that the team is doing good or bad, but treasury/backing does. And it’s fair to evaluate them based on this.
I think total Volta in LPs doesn’t exceed 4k tokens. There really isn’t much for “new investors” the only ways I see new people joining, is changing hands, so someone sells and someone else buys, or someone decides they want to buy volta at backing price, which I don’t see happening.
One important thing to understand about marketing is that it’s unnecessary for Volta Club, maybe for UwU, and interport, and it’s not the treasury team’s responsibility to do marketing. Marketing is needed when you want hype. As a protocol, we don’t need it, because the treasury is earning money for us. I’m not saying that the price will reach backing if someone sponsor’s this proposal and it passes, but with strategic buybacks, we will increase market price, and increase backing even more. Market price used to be around 200 while backing was ranging from 300-400 (can’t remember the figures exactly) we can get back there, and even higher with this proposal passing, and with less people complaining when price is 1/3 ish of backing.

We all want to take back profits. And I don’t think this proposal or CMP 3 addresses that issue very well. But continuous buybacks will eventually lead to price approaching backing, and imo it’s better than a 10 day period where no ine knows if the treasury team will do buybacks or not, and could drain the treasury.

Thanks for your response. 90 day average addresses the concern of people who said that Sifu inflated the price for his benefit. But as was discussed in discord, UwU is our protocol, we’re not gonna dump it. And even with UwU price’s inflation, this meant that the HWM was also higher. I don’t think Sifu would try to inflate the price every quarter just for a higher performance fee.

After seeing a few of the responses, I think it would make sense to add this into the proposal, thanks Murdock!

Still not sure we have enough traction though to let this even go through a snapshot lol.

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