- Maintain or ramp up spending in the event of a significant market drawdown- Allow governance contributors, grant recipients, and security bounty recipients to be fully or partly paid in stablecoins- Enable yield-generation on Yearn, Aave, and Compound- Provide liquidity on stablecoin-stablecoin pools 

The first priority for many large protocol treasuries is to diversify a portion of assets into stablecoins. The stablecoin allocation should at least cover a few years of operating expenses for the treasury.

At the same time, however, native tokens are exposed to general market volatilities and are not immune to strong sell-offs during bear markets. It is in such circumstances that the daily operations and functionality of a DAO can be disrupted due to the lack of cash reserves for its regular funding. Partially compensating a core group of team member... See more

Treasury allocations should ensure that critical expenses can be funded even if the protocol token has a significant drawdown.