Decentralized Autonomous Organizations (DAOs) in the DeFi sector are increasingly moving to diversify their treasures to ensure long-term survival.
decentralized money market
Rari Capital’s DAO is the latest to look at diversifying its treasury, launching a governance proposal that puts pressure on a portion of its native RGT token holdings to be converted into stablecoins.
Published by Rari Capital investor Framework Ventures, the proposal calls for DAO to sell up to 250,000 RGT or 10% of its holdings for USD Coin (USDC) through a public lot auction.
While tokens would fetch about $8.8 million at the current price of $35.14, the Framework suggests a minimum bid price of $25 per token based on applying a discount to the 30-day average price of the RG The treasury would receive at least $6.25 million for the tokens using the discounted price.
The framework would provide a $5 million barrier “to ensure that the DAO does not sell any RGT at a very low price, while ensuring that the treasury actually diversifies.”
The post highlights that Rari Capital DAO’s treasury is currently 99.99% composed of RGT, stating that “diversifying a portion of treasury into productive assets outside the protocol’s native token” would mitigate the risk for the organization.
Tokens sold through staking would be subject to a two-year lock-in “to ensure long-term commitment from participants” using ERC-20 tokens with acquisition control applied to transfers. The proposal suggests that no maximum participation limits will be imposed on bidders.
The response from the Rari community seems positive so far, with forum participant “CometShock” stating: “Having substantial non-native treasury assets is a key pillar in ensuring that Rari Capital DAO can continue to fund and support its operations. ”
“AverageDeFiDegen” suggested on the Rari Capital forum that the funds be auctioned in four lots of 62,500 quarterly RGTs over a year, adding that a 12-month block plus 12-month rights would constitute a “healthier” token issuance schedule .
The Framework responded that it “completely” agreed with the suggested emissions schedule and stated that they would like more feedback from the DAO community on the possibility of scaling the auction.
Rari is not alone in seeking to diversify the assets to which its treasury is exposed, with some major projects recently turning to venture capital to unload large sums of tokens.
BadgerDAO and pool together
In February, income aggregator Bitcoin BadgerDAO (BADGER) released a governance proposal to diversify its treasury exposure by selling governance tokens to “strategic partners” over the course of three months.
The move generated $21 million in BADGER sold to Polychain Capital, ParaFi Capital, Blockchain Capital and a notable Bitcoin whale the following month.
In May, PoolTogether (POOL) decentralized lottery protocol tokenhold holders voted in favor of a proposed sale of 538,461 POOL to Galaxy Digital, ParaFi Capital, Dragonfly Capital, Maven11 and Nascent in exchange for $5.95 million USDC .
Transactions saw 5.38% of POOL’s supply or 7.2% of DAO’s treasury sold to investors. A part of the tokens is subject to a time lock, while another part of the POOL can be deposited into the protocol pools to generate revenue, but cannot earn rewards.
After the transactions, PoolTogether’s treasury now holds $7 million in stablecoins and 52% of all POOL supplies. The tokens sold for $13 each, based on a 35% discount off the token’s 14-day moving average price.
“In addition to helping to drive growth, treasury diversification makes sense to ensure the protocol’s long-term sustainability in the case of any large 2018-style bear market,” wrote PoolTogether.
SushiSwap proposal rejected
However, a similar proposal by SushiSwap to diversify its treasury assets through a strategic $60 million fundraising round was shot down within weeks after being attacked by the project’s community in July.
Some projects have sought to diversify their treasury portfolios to include the governance tokens of other DeFi protocols, including the dHEDGE decentralized asset management protocol (DHT).
In August, Perpetual Protocol DAOs (PERP) and dHEDGE exchanged $1,000,000 of their respective governance tokens, while a similar transaction worth half the amount was conducted with the Mask Network the following month.
dHEDGE, mStable and UMA
In early October, Synethix led dHEDGE’s $2 million “DAO treasury diversification round”. Synthetix also took steps to diversify its treasury, selling $12M in SNX from its DAO treasury to Coinbase Ventures, Paradigm and IOSG in February.
The dHEDGE DTOP token – an ERC20 that tracks the performance of the platform’s top 10 asset managers based on a risk-adjusted score – was also used by DAOs as a means of diversifying treasury exposure.
In May, mStable and Perpetual Protocol each invested $200,000 in the token, while Maple Finance and Horizon Finance allocated $100,000 from their respective treasuries and InsurAce bought $50,000 in DTOP. The DTOP token has increased 8.46% since launch on April 1st.
UMA also sought to innovate a product designed for DAOs interested in treasury risk management with the launch of its Range Tokens in August. The bill describes its Range Tokens as similar to convertible debt, allowing DAOs to use their native tokens as collateral to borrow funds without liquidation risk.
Read also: Exchange launches millionaire ad campaign with Matt Damon
Also read: Blogger Allan dos Santos uses Bitcoin to escape sanctions from the Brazilian justice
Also read: Seller auctions CryptoPunks and pays $130 million for his own work
BadgerDAO: Hackers drain $10 million in latest DeFi breach
- BadgerDAO suffers $10 million hack
- Traders were sent illicit permission notifications
- BADGER loses 15% of its value
The decentralized finance industry of the crypto sector has now become one of the most sought-after industries. This is because it provides users with anonymity, and they can carry out their activities without the prying eyes of financial institutions. Furthermore, traders are open to making huge amounts of profits in the protocols in the sector by staking or farming. However, some illicit actors would rather exploit and steal from people instead of making their profits. In yet another hack case in the DeFi sector, hackers have exploited BadgerDAO, draining $10 million from the decentralized finance protocol.
Traders got illicit permission notifications
BadgerDAO is a protocol in the decentralized finance sector that allows traders access to various lending services and takes collateral in Bitcoin. According to the platform, upon calculating funds missing through the exploits, things are sitting around $10 million. In the reports that made the rounds today, users claimed that the hack was perpetrated through BadgerDAO’s interface and not its smart contracts like most hacks. Users claimed they were sent notifications about allowing new permissions while carrying out activities on the platform. With some users allowing the permissions, the hackers could cart away various amounts of digital assets going to a worth of $10 million.
BadgerDAO’s native token plummets
After the hack, the protocol developers said that users complained that they witnessed the unauthorized drawing of funds from their accounts. However, the protocol has moved into action swiftly, putting everything on the protocol on hold at the moment. The developers have also claimed that engineers are working tirelessly to fix the issue and ascertain the level of damage that the breach may have caused. However, BadgerDAO has refused to comment on the exact amount of missing funds on the platform and the level of damage that needs repair before operations can continue.
Some analysis websites have claimed that the amount exploited from the platform is $100 million. After the hack, the native token of the platform, BADGER, dipped in value, losing about 15% of its value, and is currently trading around $22. Hacks have now become predominant in the DeFi sector as the year draws to a close. Some days ago, MonoX, another DeFi protocol, got hacked with the illicit actors carting away more than $30 million in different digital assets.
Someone Just Lost $50 Million Worth of Bitcoin to DeFi Hacker
A single user of the Badger DAO protocol has lost a whopping $50 million worth of Bitcoin to a hacker
Badger DAO, a Bitcoin-focused decentralized finance project built on the Ethereum blockchain, has been drained of roughly $100 million as a result of a nasty front-end attack.
A single user has lost 896 BTC (roughly $50 million), according to blockchain security company PeckShield.
In a Twitter statement, the team has acknowledged reports of unauthorized withdrawals, adding that its engineers are investigating the issue.
The protocol’s smart contracts have been temporarily halted.
Badger has received reports of unauthorized withdrawals of user funds.
As Badger engineers investigate this, all smart contracts have been paused to prevent further withdrawals.
Our investigation is ongoing and we will release further information as soon as possible.— ₿adgerDAO 🦡 (@BadgerDAO) December 2, 2021
According to data provided by DeFi Pulse, Badger DAO is the 23rd biggest DeFi protocol on Ethereum. Last month, it topped $1 billion in total value locked.
Badger DAO allows users to earn passive income with Bitcoin by converting it to either Wrapped Bitcoin (WBTC) or renBTC and depositing it into Sett vaults that algorithmically allocate and autocompound users’ yields.
The hack happened just days before the yield vault protocol’s one-year anniversary.
BADGER, the native token of the Badger DAO project, is down 15.3% on the news, according to CoinGecko data.
GameX Ecosystem: Emerging DAO in World of Gaming and DeFi
GameX is an emerging protocol that was built by gamers in a bid to promote the integration of games in today’s fast-growing decentralized finance (DeFi) ecosystem. Despite the fact that the blockchain and specifically the DeFi ecosystem is still in its infancy, the past year has seen the emergence of innovative projects that are notably disrupting mainstream finance. GameX is no exception.
Built on the Binance Smart Chain (BSC) network, the GameX protocol seeks to become a one-stop-shop for many aspects of decentralized gaming. This includes developing games that users can play, incorporating Non-Fungible Token (NFT) capabilities, and also rewarding users for contributing to its ecosystem development.
Gamex NFT Marketplace
GameX protocol is in the last phases of developing its NFT marketplace where digital artworks and collectibles built through the BEP-721 standard will be supported. The GameX NFT marketplace is a dynamic one and permits creators to mint their digital piece, with additional permissions that can let them list it for sale immediately or at a later time in the future.
The protocol maintains a very good standard for the operations of its NFT marketplace and will provide a verification capability to enable users to deal with trusted creators only. While the verification badge will be obtainable easily by just filling out a form, the applicant or creator will be required to provide enough documentation in order to get verified.
According to GameX, “verified badges are granted to creators and collectors that show enough proof of authenticity and active dedication to the marketplace. We are looking at multiple factors such as active social media presence and following, dialogue with community members, number of minted and sold items.”
GameX NFT marketplace listed items will also be subject to royalty rewards which are charged when a listed item is resold.
The XGAMEX token that is designed as a reward system for GameX game players, as well as the buyers and sellers of listed NFTs.
Over the next months, the platform is set to release a play-to-earn racing game (META RACE) in which players will be able to compete against each other. Drawing from its broad capabilities, there is bound to be an NFT incorporation into the racing game, a move that is billed to further enhance the broad embrace of the gaming outfit.