Yam Treasury Management and Maintenance Framework Silo

YAM DAO Grant Application

This is the first step in applying for a grant from YAM to fund a new project! Please fill out the form below to let the YAM community know what your project is all about. Why this idea? Why you? Why now?


1. What is your name? Pseudonyms are cool too. :disguised_face:
Who is the point person is for the application.

Answer:
Feddas


2. What is your discord/telegram handle? :speaking_head:
if you are not in the discord or telegram, please join by following these links:
Yam 🍠
Telegram: Contact @yamfarm

Answer:
Feddas#0428


3. Project Name :building_construction:
What should we call your project?

Answer:
Yam Treasury Management and Maintenance Framework


4. Project Description :thinking: (140 words or less)
*Give a summary of the project you are proposing *

Answer:
Yam’s treasury is the centerpiece of Yam DAO. It is currently valued at approximately $3.1 million (estimated 6.22.22). Here’s a current dune dashboard: Dune
**This proposal is to create a framework for consistent evaluation and rebalancing of the treasury. **
I assisted in building and designing Yam’s current treasury management system along with DAO House a Yam treasury management as a service for other DAOs. Now there is sufficient historical data on Yam’s treasury and expenses to design a long term framework for anyone to manage and maintain Yam’s treasury.


5. About You :busts_in_silhouette:
Tell us about you and your team. What experience do you and your team have that is relevant to the project. Please provide github profiles, websites, prior work, etc

Answer:
I’ve been a contributor to Yam Dao since the start of YamV3, here’s my first public forum post in Oct 2020 for Yam:

Since then I designed proposed and gotten approved the first initial design of the Yam Treasury Strategy and allocation. I spearheaded the Treasury Management as a Service for DAOs project that was a collaboration between tokensets.com and Yam. The largest client being SushiSwap that invested $10 million of their treasury into the service. My primary focus is and was treasury management.
Here’s a historical public record of some of the work that I’ve done @ Yam DAO:
Profile - feddas - Yam Forum


6. Project Goals and Scope :rocket:
If the project succeeds, what goals will it achieve? How do we measure that success? Please provide specific KPIs. If you are unsure of how to do this, do the best you can and we can work it out together.

Answer:

  1. Requirements Doc
    a. Will be published for feedback/snapshot before moving to step 2.
  2. Evaluate current investment strategy of a moderately portfolio targeting < 0.75 Beta and < 0.5 Correlation.
    a. Things have changed now that we are no longer in the middle of a bull market, in addition there have been significant changes to Yam DAO and its expenses. Taking these considerations into account to evaluate for long term success of Yam DAO is now more prudent than ever.
    b. Also there are significant limitations for a DAO managed Treasury that personal investment portfolios do not have. Due to my previous work with Yam, I’ve worked thru many of these issues and will be able to give a better comprehensive portfolio.
  3. Make recommendations based on results from #1.
    a. Should we change strategy targets? Maybe move to a % allocation model since crypto in general is highly correlated and there are not any good counter balances to crypto within the guidelines of a DAO Treasury.
    b. What and why are the recommendations appropriate for Yam DAO and the long term future.
  4. Create a framework for rebalancing and maintenance of the treasury.
    a. Successful treasury management requires maintenance of the assets.
    b. Framework will be a step by step guide with necessary tools to signal for the need to rebalance the treasury and then provide the way to do it.
    c. Framework will need to be adjusted if there are significant changes to the types of assets or expenses of the DAO but general guidelines will be provided.
  5. Steward recommendations thru Yam governance, adjust if needed and assist in applying changes to Yam Treasury.
  6. Nice to have: Create a framework that is not specific to Yam’s Treasury and can be applied to other treasuries potentially useful to reinvigorate Yam’s DAO house as a service.

7. Milestones :placard:
What are the steps that you plan to follow to complete this project. Is it one step or multiple? If there are multiple then please list all of them.

Answer:

  1. Requirements Doc
  2. Evaluate current investment strategy of a moderately portfolio targeting < 0.75 Beta and < 0.5 Correlation. Make recommendations.
  3. Create a framework for rebalancing and maintenance of the treasury.
  4. Steward recommendations thru Yam governance, adjust if needed and assist in applying changes to Yam Treasury.

8. YAM / Ecosystem Benefit :blush:
What value does your project add to YAM and the wider ecosystem? How do we measure that benefit?

Answer:
Seeing the rise and the correction of crypto in the lens of DAO treasury management since the start of YamV3 has been fascinating. There have been multiple DAOs / protocols who decided to ignore treasury management and are suffering now because of it. Unfortunately crypto as a whole moves in cycles until this is broken, it is prudent to plan around these cycles. In the heat of the moment it is easy to double down when you should be thinking about the worse case scenario.
**This proposal provides a long term reusable framework that will provide regular rebalancing and flexibility to be used as a base for YAM’s DAO treasury management for many cycles to come. **


9. Funding Request and Breakdown :money_with_wings:
Please include the total funding amount that you need and also include a breakdown of how the funds will be used across each part of the project.

Answer:
Multiple parts of this proposal will be published publicly with request for feedback. I anticipate the need to work 25 hours a week due to the time it takes for public feedback and Yam governance timing.

According to the milestones, my funding request will be:

  1. 2 Week – Requirements Doc
    a. Publish / Feedback / Snapshot Approval
  2. 4 Weeks - Evaluate current investment strategy of a moderately portfolio targeting < 0.75 Beta and < 0.5 Correlation. Incorporate ideas around protocol owned liquidity and long term governance adjustments. Make recommendations.
    a. Publish / Feedback
  3. 8 Weeks - Create a framework for rebalancing and maintenance of the treasury.
    a. Publish / Feedback
  4. 4 Weeks - Steward recommendations thru Yam governance, adjust if needed and assist in applying changes to Yam Treasury.
    a. Publish / Feedback / Snapshot Approval / On-Chain Approval

Total of 18 Weeks / 4.5 Months @ 25 hours a week average @ a rate of $85 per hour. Compensation to be in cadence with monthly on-chain transaction and monthly transparency reports.

Funding request for part 1: Requirements Doc: $4,250. 70% Stables and 30% Yam.


10. Other Information :question:
Imagine you’re a YAM holder. What else do you think we should know about your application?

Answer:
The long term success of Yam is dependent on Yam’s Treasury. With the turn in the market this is the optimal opportunity to create this investment framework for long term success of Yam.


Hey @feddas thanks for posting this. All good stuff, but I think we should adjust the application a little bit in light of the process and lessons learned from the Yambassadors silo. One of the problems there (in my mind) was the payment/cost part of the project was set out and voted upon before enough information was presented to know whether it was realistic.

The requirements/specifications document is really the document that we need to make a good assessment of what the project will entail and how much work it will take. So until we have that document, I’m not sure it is helpful to give costs up front. Instead, I would say that there should be a proposal/cost to do the requirements document, and then once that is done, we determine the grant amount, scope, duration, etc.

This application would be to get approval to create this silo (project) as something that the DAO believes is worth funding, and work out any details around paying for the requirements doc. I think this can dovetail with the post on dispute resolution nicely.

So the full process would be:


[Apply for silo and requirements doc grant] → [get approval] → [do work to create requirements doc] → [approve requirements doc] → [apply for grant to perform work to build out silo based on requirements doc.]


If you agree and want to move forward in this way, I think the change is as simple as updating the compensation section to only include the requirements doc funding request.

1 Like

on more practical notes about the silo itself and treasury management I wonder:

  1. How much of the existing work on this front that Krugman and I (and you) have done can we re-use?

  2. Treasury management is quite a fickle and subjective thing that depends a lot on the assumptions that are going into it. As you mention, there have been significant changes to the size of the DAO and we are working on more changes. And beyond the organizational changes, there are big questions of purpose and mission that need to be answered to really know what we should do with the treasury.

    You mention a lot of this in the project goals and scope, but I fear that if we don’t answer some of these big questions around what the DAO is, it will be hard to craft a strategy that works other than something very general, which maybe in the end is ok.

  3. There is no mention of the code implementation required to do some of the treasury management that is needed. We are limited by the timelock when it comes to interacting with a lot of defi and currently only have contracts to swap with uniswap v2 style contracts. There will be a need for some coding work, or a strategy for some other way to do things like swap funds (i.e. sending to a multi-sig) that will need to be part of the full proposal.

A lot of these questions are the things that come out in the requirements documentation and initial explorations, but I figure it can’t hurt to bring them up now, even if they don’t affect wanting to move forward with the proposal.

Thanks

1 Like

Sounds good

It will the be the starting base of the project. I will be evaluating the beta and correlation model again now that we’ve gotten more historical data.

From the history of Yam, I see treasury management as the primary support of any purpose and mission of Yam. Creating a framework that can be used even if the exact purpose or mission of Yam is changed is the goal.

Yes there will be code work that will be required to complete the process. The amount of code work really depends on what the community decides is the best course of action. My proposal won’t include the work but it will include the processing of getting a grant completed for a developer to do the work.

Good questions.

Snapshot has been posted. Feel free to continue to discuss.

https://snapshot.org/#/yam.eth/proposal/0x31f5cf3dd15fd194b96ac5ff365340d35436346e7f9c5db74ad9a672aee01804