Treasury management roundtable: notes & main takeaways

I attended a treasury management roundtable hosted by Centrifuge & Gnosis in Berlin on June 23rd. We focused on three overarching themes in our discussion: governance, DAO2DAO and portfolio management. I wanted to share some main take aways from the discussion that might be helpful as Radicle considers a treasury diversification strategy.

Governance:

  • Who is making treasury management decisions? There seems to be a trend to optimize for efficiency and create specialized decision-making groups that are mandated to make diversification and management decisions. Monitoring needs could be limited - can preset parameters for treasury performance and if not being met can have decision making power be revoked.

Quick personal thought here: I understand the benefits of this setup - some folks are better positioned than others to make certain treasury decisions and it is way more efficient than going through the entire gov process for each small decision. However, I also am slightly wary as it heavily concentrates these decisions to a small group. I do think it would be helpful to have a focused group of folks formulating treasury strategy, but I believe a wider group of folks should be able to help make decisions (e.g. at least entire core team). I know @matto has quite a few thoughts around how treasury decision making could work for Radicle and is working on a forum post which I look forward to reading.

DAO2DAO

  • Diversification via token swaps with relavant projects (share similar values/mission) boosts network resilience and encourages governance participation

Portfolio Management

  • Decide how much of the treasury is for strategy rather than investment. This will help determine mix of blue chips (e.g. ETH, BTC), stables (USDC), natives, etc.
  • Explore other creative ways to diversify with uncorrelated assets (e.g. data (via Ocean), real world assets (via Centrifuge), investing in related projects/startups, etc.)
  • Risk management - maybe useful to have this be somewhat centralized/focus of one team
  • Long-term: Will we always need/want a treasury? Goal to make it self sustainable. What is the time horizon for eliminating it?

I hope these are helpful notes and look forward to further treasury management discussions within Radicle. :money_with_wings: :seedling:

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Also wanted to include some treasury management tools/services that I have been looking into in case anyone was interested in already taking a look there.

  • Coinshift - multi-sig treasury management

  • Index Coop - crypto investment vehicles for individuals & institutions

  • Element Finance - provides fixed and variable yield vaults

  • Enzyme Finance - on-chain asset management

  • Karpatkey - treasury management outsourcing services

  • Llama - provides economic infrastructure for DAOs