[DAO Discussion] Defining Treasury Council, TOs and Risk Officer

Governance DAO Discussion
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This proposal defines and solidifies the Treasury Council with 4 Treasury Operators. It supersedes WIP 15 which originally defined TO roles. The Treasury Manager, Trading Teams, and Advisory roles are permanently obsolete with this proposal. We have a large community of capable people readily available to fill TO roles and do not need investments for the DAO to be determined by one person.

This proposal also introduces one new role, Risk Officer, to do due diligence on investments, directional exposure, and deployment of DAO funds into DeFi protocols. The Treasury Council submits their ideas which pass voting there to the RO, who may either veto and reject the idea, or submit it to the multisig for execution.

Previous guidance in WIP 15 not amended by this proposal remain unchanged.

Proposed structure of Treasury Council:

4 elected TO positions that have a range of capabilities. Current elected Team will fill seats as needed if 4 TOs are not elected.

TO duties include finding good farms and liquidity markets for stables, directional exposure, options and other hedging strategies, and sourcing deals.

Each TO votes on proposed strategies with a majority needed to submit to the RO.

Compensation is unchanged from WIP 15 except TO members can choose equivalent stable payment instead of wMEMO if they choose. As a reminder, each member receives 0.15 wMEMO at the beginning of each month and can earn an additional 2% of profits for each successfully passed proposal. Other Council members assisting with developing, negotiating, or otherwise helping in a meaningful way as determined by majority vote can earn an additional 0.5% of profits.
Reference WIP 15 for further details on compensation and removal of inactive or bad actors.

TO members submit their successfully passed proposal with the following information to the RO:

  1. The capital allocation’s target (farm, coin, etc)
  2. The sizing
  3. Rationale
  4. Risks
  5. Conflicts (if any)

Risk Officer:
This role requires a deep knowledge of DeFi. They are required to evaluate the risks of deployment into farms on a host of possible protocols, vet sourced deals, and other strategies. They should also be wary of WL having too much exposure to any particular protocol or directional position. All passed proposals from the Treasury Council are forwarded to this role to evaluate. They may veto and cancel deployment, return a proposal back with instructions (e.g. reduction of exposure), or approve deployment. Approvals are sent to the multisig to execute the transaction.

The RO can always be voted out through governance.

Compensation for RO:
This is a high skill requirement role, but it should not be time consuming. Therefore a good salary, but not exorbitant is suggested: 20k per quarter paid in a reasonably pegged (>99.8%) stablecoin the Treasury has available.

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This is awesome! Great changes to WIP 15 and I think this is a great move for maintaining the treasury with a team. LFG!

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Loving it, makes the system more balanced and has checks in place.

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I approve. This will help everything move forward.

Let’s do it @NalX ! :grinning_face_with_smiling_eyes:

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Very well written! Looks great.

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Solid proposal! Let’s make Wonderland grape again!

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The good ol’ Quality Assurance position. They look at the details, and push back when things need another pass. They can get lazy too, when everything is “looks good, looks good”, so keep them sharp, or hire multiples if we get busy.

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Lets ask Sifu do the RO position, can‘t imagine a better qualified person. Can add him in rfc so we start with RO and the TO‘s in WIP now directly, instead of next month :partying_face:

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To clarify, WIP 15 payments were to be made on a quarterly basis before the whitelist period. Are we proposing that to be changed to monthly payment ?

In my opinion the Risk Officer deserve it’s own proposal, but here are a few thoughts:

The Risk Officer seems to have a lot more power than evaluating risk. The way I see it, they are essentially a TM in disguise. They decide what is implemented and what isn’t and tell the msig when to pull the trigger or pull the plug. TOs being essentially minions under them. I’d say giving them that power puts a lot of liability on them.

It should also be noted that they shouldn’t have the power to veto a DAO vote. If they have concerns about an investment the DAO is conserving they should make their concern clear for the DAO to have the relevant information when voting.

Who covers for RO when none is elected ?

Why not put the RO as part of the council ? Maybe the chairperson.

TO finds an opportunity → send to RO → RO evaluate risks/add information → puts the whole thing to a vote.

If council votes in favor, goes to msig. They could get a vote so it would mean the TOs would need to vote unanimously in favor to “overturn” the RO.

Another issue might be the number of people on the council. Unless we change the above, if TOs work together, it quickly reduces the number of people eligible to vote.

In one of the draft structure being worked on the council was separate from the team finding deals and strats. The “Treasury Team” would wok together and propose their strats to a “Treasury Council” of 5. Those council members are all neutral and ensured that the proposed strats would fit within the DAO parameters (would be a good place to add the risk officer). If a proposal meets the requirement, it is passed to the msig for execution. If it doesn’t, goes back to Treasury Team. Risk Officer can vote changes to parameters as required.

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My name is The Ferengi and I support this proposition.
Great work Ruian, this is a big step in the right direction.

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This might be a good idea.

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This proposal have my support.

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sounds like a solid plan, let’s do it Nal X!

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Great write up ruian. I concur with nalx comments.

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I support this proposal as well, no arguments from me!

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I like this proposal too. Just wondering, since there’s a positive sentiment of having regular treasury reports for the community, would those be prepared by the TOs, RO, or Council? Or all 3?

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I will clarify in the RFC that the earnings of TOs are monthly but paid per quarter as WIP 15 states.

The Risk Officer could be its own proposal. I don’t want to overrun the DAO with excessive voting requirements. There will be another proposal to get legal assistance coming from me soon.

The RO is not a TM. They do not suggest investments. They just provide assurance that what the TOs are doing isn’t overly risky, improper, or flawed in a way that hurts the treasury.

A DAO vote can always override TOs and the RO. The DAO can remove any of these individuals or modify their roles at any time through governance.

The RO is separate from the council to prevent possible collusion and corruption.

The RO doesn’t need to send things back to TOs with changes to vote on in most cases. They are not expected to be adding information or changing strategies.

An example: TOs vote 2/3 or 3/3 (the 4th TO proposes and cannot vote), to put 10mm into a stablecoin farm on a new protocol. The RO looks at the new protocol and determines it’s too risky due to it not being audited. They veto the proposal and it is not sent to the multisig.

Another example: TOs vote to get 15mm of wBTC directional exposure due to an upcoming halving in mining rewards. The proposal is sent to the RO. The RO determines WL has significant exposure to directionals or wBTC itself already. It is sent back to the TOs to resubmit with fewer allocated funds, say 5mm. They vote, send it to the RO, the RO ships it to the multisig.

The council is 4 members, and the proposing TO cannot vote on their own proposal (obviously they support it). That means all passed votes will effectively be 3/4 or 4/4.

As far as the last point, I think we have qualified people that are good at finding opportunities. Sourcing deals is part of that and I think it can be covered here. My intention is to avoid payroll and governance bloat. If the TOs are unable to deliver on sourcing deals satisfactorily we can put up a proposal to add another council member that specializes in this area, or even a team.

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Topics has been approved for RFC:
https://dao.wonderland.money/t/rfc-defining-risk-officer-and-appointing-sifu-as-interim/19562