Scope:
This proposal formally defines and introduces a new role called Risk Officer (RO).
Link to previous discussions:
[DAO Discussion] - Defining Treasury Council, TOs and Risk Officer
[RFC] - Defining Risk Officer and appointing Sifu as interim
Objective:
The main goal of this proposal is to improve the current treasury deployment process defined in WIP 15 by adding a Risk Officer to limit the DAO’s risk in all proposed fund allocations.
High Level Overview:
Deploying a treasury the size of Wonderland’s doesn’t come without risks. It is proposed to implement a Risk Officer position to ensure that Wonderland is not too heavily exposed to a particular protocol, directional, smart contract risk, or poorly vetted deal.
Low Level Details:
Risk Officer
This proposal introduces the role of Risk Officer to do due diligence on investments, directional exposure, and deployment of DAO funds into DeFi protocols.
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 Wonderland having too much exposure to any particular protocol or directional position.
All passed proposals from the Treasury Council are forwarded to this role for evaluation. After evaluating the strategy, the Risk Officer may submit the proposal to the multisig for execution, provide suggestions to reduce risk to what they deem acceptable (e.g. reduce sizing) and have the Treasury Council revote or veto and reject the idea if the risk is not deemed manageable.
The Risk Officer is not responsible for quality or profitability of investments or strategies nor provide advice on, but is in place to ensure safety and reduce risks for holders.
Any applicant for the Risk Officer position should be invested into Wonderland and have a sizable portfolio (minimum 5 wMEMO), to limit bribes and ensure interests are aligned with the protocol. The Risk Officer should able to prove they have a deep knowledge of DeFi and be doxxed, or be a well known anon personality. The Risk Officer does not vote, nor participate in development of strategies.
Removal of the Risk Officer
The removal of a Risk Officer can be done through a regular DAO proposal or through the same process established in WIP 15 for Treasury Operators, if it is believed the Risk Officer is acting against the best interest of the protocol (e.g. RO not doing their job or abusing their authority).
- A majority vote from within the group of all treasury operators and elected moderation team is required to initiate such a vote.
- The individual will have a minimum of 7 days to provide an argument for maintaining their position.
- A Snapshot Vote lasting 72 hours will settle the decision.
Treasury Operators may not propose new strategies while there is no Risk Officer appointed. Managing current investments/strategies, farms, sales and DAO led investments can continue to be managed.
Compensation
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.
Business and/or technical requirements:
To help with the current transition and ensure the Risk Officer Position is implemented and filled as soon as possible, it is proposed that Sifu is appointed as interim Risk Officer, without compensation, until a formal proposal to establish proper candidates is completed.
Elected Treasury Operators and other members of the Treasury Council will have to work with the Risk Officer to put in place a way to communicate efficiently.
The Risk Officer will also ensure that communication with the multisig is efficient.
Snapshot details
Link:
https://wl-l.ink/Snapshot/WIP-22
Voting options:
Yes, implement the proposal
Make no changes
and I approve this WIP.