1. Market Risk
You make fair points. I just want to stress the fact that nothing in this proposal changes the composition of existing treasury funds. $14.7M in USDC has been collected since November 2021 and $0 have been spent, let alone invested, so far. If your $2.4M estimate is correct, it would come out to ~16% of the existing treasury.
1INCH is already 90% off its peak so a further 90% drop from here would put the price of one token at ~$0.07 and the fully diluted valuation of 1INCH at ~$100M. Wouldn’t we want to be purchasing the token at that price? Almost all of the financially successful people in this space had to have the stomach to purchase tokens during bear markets.
2. Risk of Losing a Competitive Edge
I think the potential advantages are outlined sufficiently in the Motivations section of this proposal.
But I want to again add a) this strategy can be changed at anytime via governance vote if we don’t like the impacts on the treasury, and b) this proposal doesn’t touch the ~$14.7M in stables already held by the DAO.
3. Possible Conflict Risk
Vesting contracts are all on-chain and fully accessible to anyone that wants to dig through them. True, I don’t think it have been broken down individually anywhere (though they are certainly included in the token unlock schedule).
Let’s break down the 1inch Foundation StepVesting Contract (the largest holder of v1INCH) for example:
started = 1606824000 (Tue Dec 01 2020 05:00:00 UTC-0700)
cliffDuration = 365 days
stepDuration = 182.5 days
numOfSteps = 6
So, the cliff ended December 2021 and all of the Foundation’s v1INCH will be fully claimable come December 2024.
1. Use War Chest to Build in Bear Market
I agree with your path forward here and really like that particular proposal. Currently we’re doing an analysis to see what formal legal structures are required of the DAO if it is to write grants.
2. Limit 1inch Purchase to Keep Competitive Advantage
I like this idea and would support its implementation. I think this proposal should be viewed as a temporary solution, and this idea would force us to acknowledge that by requiring a vote at the $1M mark.
3. Alignment Stakeholder Interest
I haven’t seen the Foundation’s balance sheets but I think it’s safe to assume they’re in the opposite position of the DAO – they likely have far more 1INCH than stables seeing as they were the initial distributors of 1INCH. I posted their vesting contract above.
I agree with your closing paragraph, too. I hope this comment has addressed some of the concerns you raised.