How DAOs should approach treasury management on Bankless

But how can we produce these statements such that they can be verifiable with on-chain data? MakerDAO produced real-time P&L and balance sheet data using Dune Analytics. The next step is adding relevant governance voting and discussions for context. For example, every large treasury transaction should have an associated “receipt” in the form of... See more

Yearn’s Q1 2021 report is an excellent example of useful treasury disclosure. It contains an income statement, balance sheet, key revenue drivers, operating expenses and salaries, and priorities for the protocol.

Compounding: prevent harming treasury returns by giving away tokens at inopportune times

Contributor payments: make a bulk of contributor payments in stables while long-term contributors are partly paid in vested protocol tokens

Cheap cost of financing: funding expenses via debt at certain rates can be cheaper than via tokens

Governance rights: prevent distributing ownership and voting rights to stakeholders that don’t benefit the protocol over the long-term

In what cases should treasuries borrow instead of spend native tokens?

- Maintain or ramp up spending in the event of a significant market drawdown- Allow governance contributors, grant recipients, and security bounty recipients to be fully or partly paid in stablecoins- Enable yield-generation on Yearn, Aave, and Compound- Provide liquidity on stablecoin-stablecoin pools 

Diversifying into stablecoins provides a protocol DAO with the following benefits: