A Fresh Look At DAOs – The New (Digital) Family Offices - GCR

Given their operating expenses are denominated in USD/fiat, another sustained bear market might force DAOs to sell native tokens at “fire-sale” prices to finance their normal operations. DAOs therefore ought to generate multiple income streams (i.e., protocol revenue and yield from investments) that can cover these operating expenses; but since the... See more

Most protocol DAOs currently only hold their native protocol token on their balance sheets. Given the volatile nature of cryptocurrencies, this could mean that DAOs are forced to sell their native tokens during extended bear markets (and therefore at inopportune prices) to finance ongoing operations. Consequently, DAOs should first ensure that they... See more

Currently, even some of the largest protocols are unable to generate enough revenue to cover operational expenses (audits, salaries/payments to contributors, marketing, etc.). Yearn, for instance, operates at a loss even after accounting for non-operating income from yield farming. As such, retaining protocol revenue alone is likely to be insuffici... See more

When DAOs are needed The growth of DAOs in general and the massive success of some of the most innovative ones inevitably result in the perception that the route to growth and robust network participation requires a DAO structure. In times of ebullience, market forces make it easy to assume that every organization, community, or project needs a DAO... See more