Fully support this proposal! We shall achieve grape and peachful Wonderland!
I love to see the option “make significant changes to this proposal”. Proposals are often presented as all or nothing and it’s refreshing to see openness to the possibility to send certain parts back to the drawing board.
There are now a few proposals for TM that I can see, @z0li @TaeKwonDo and @bottlecapman . Can you guys have a look at this proposal and see if you would be willing to apply for Treasury Operator if this structure passes governance?
To be honest, this kind of bothers me, I feel like there should be full transparency with wMemo holders about the strategy and as well as internal votes that take place.
It could be a channel where only certain members are authorized to post and debate, but it should be read only for everyone.
My intention with calling for a set of secure discord channels is to allow for internal analysis about trades, investments, and strategies that could be front run if publicly discussed before deployment. The channel(s) could act as a repository for these discussion to make sharing the communications each quarter easier and more organized.
I believe that the team will need a level of discretion in many of their activities before deploying strategies, but I also believe holder’s have a right to those communication at some point. Specifying how and where we want the team to document these communications seems important to me, so we don’t find ourselves in a situation where the team communicated in a variety of ways that are almost impossible to piece together for release each quarter.
I think it would be great to have a channel for the team to discuss some strategies openly, maybe even push all messages from the private channel to the public channel each quarter.
I agree with this but it should be open only to active forum members, anyone can join discord buy some WMEMO and join the private channels with minimal effort
I can definitely see value in some parts of the internal debates being performed in a private setting, especially if you have more junior members who end up taking on the role of TO. Avoiding basic questions or knowledge gaps being exposed - leading to a lack of trust in the team. Not to mention there can be confidential deals being worked out, but that’s more common sense imo.
However, I think the risk of frontrunning is overstated in the level of impact it would actually have. Even with the size of our treasury, I don’t believe a Wonderland investment will move the needle much on many projects we invest in; unless we are chasing super low market cap/high risk plays on the open market.
Do you have an example of a hypothetical move Wonderland could make where wMemo holders being able to frontrun it would be detrimental to our investment?
On the other hand, even if Wonderland is capable of significant price impact with our investments, perhaps having this info available to holders should be an incentive to holding wMemo? I’m sure you’ve heard of pump and dump discord servers with paid tiers of access. While these are typically scams, the concept of giving your community a market edge could serve as an indirect way for those who lost a ton of money with Wonderland to get themselves back into the green - lord knows we’ve already paid the price of admission.
Unless you had other plans, I imagine the access to the information would be limited to TO, trade team, and the WL mods. So the gate that you would be setting up here would, by default, give some members of the community the advantage I described above and others not.
I also think having the information available to the community in the heat of the moment is an excellent learning opportunity for anyone interested in these topics. Releasing it after the fact will make it less meaningful and the market context, as well as the general sentiment at the time of the decision will be crucial information that is not easily sourced.
Ultimately, my view is centered around community empowerment, improvement in transparency and incentivizing growth of holders. To me, this could be a missed opportunity to stand out from other projects in an extended bear market.
Adding at least one member to the multisig that is permanent there, no matter if we have TO or not seems like a good idea - like what you proposed Alice for.
In case there is no TO that person could get the right to execute community approved investments, running operations such as farm etc.
Just as extra thought, as we might have times without TO and a 2/2 multisig should always be avoided. That person would stay on multisig always, TO or not, basically.
That’s a good point. This is a gap that was addressed in the initial discussion, but not in the RFC.
Honestly, I dont think it would be a bad idea to keep a “neutral” person on there permanently. Someone the community can trust. They wouldn’t have to help with the trading, but could sign when required to avoid delays if a “regular” signer is not available.
It would also help close the gap when there is no TM/TO or during transition periods.
I see both points - but think some info would need to be limited, other things open discussed.
Holders chat might be a good middleway (or a channel there) - but it costs about $50 of Wmemo to be a holder, so it’s hardly comparable with paid alpha discord groups.
I think frontrunning is generally a risk when discussing detailed strategies too open, be it by individuals or other projects, but that also depends on what is discussed.
In the end I’d maybe cater both and leave it up to sensitivity of the investment/strategy/time sensitivity etc discussed.
I believe most topics will be discussed in the normal discord channels anyways, but some topics may need that limited alpha chat, so having it is important as well.
I respect your position.
The middle ground approach seems logical to me; so long as those taking on the TO/trade team job intend on acting with a high degree of transparency with the community and not by default hiding away in private channels for most trading discussions. Perhaps a baseline rule could be established to reserve the private conversations for situations where the answer to the question “if I share this with the community, this will harm the protocol or our investment” is a clear yes.
The metaphor about having paid the price of admission was in regards to those who have lost significant sums of cash on the protocol, not specifically that they qualified for the holders chat lol. Though, my point here is more along the lines of why shouldn’t we offer Wonderland holders that same tier of alpha? I would see that as an excellent incentive to generate interest in the protocol, especially if the TO/trade teams start to make successful plays.
I have a slightly different perspective on this proposal.
Overall, I think it would be great to have more dedicated team members working on deploying the treasury. While this is a great idea in theory, in practice, investment by committee is very hard, and doubly so in crypto.
Many of the most profitable and highest EV trades require quick reactions and the ability to adapt to changing market conditions. You simply will not be able to execute a long or short safely with Wonderland treasury if it takes committee meetings and then multisig approval to execute any transactions - this is a recipe for disaster.
Moreover, VC/seed investments in tradfi are typically on a 5 year plus timeline - the days of crypto seed rounds being able to realize a profit within one year are over. Do we really want treasury making long term seed investments when in all likelihood the people responsible for the investment will not stick around to see it through? I fear that seed deals executed from WL treasury would be ripe for self-dealing and kickbacks…
We need investment strategies that are:
- Suitable for slow moving committee/multisig (ie, not quick moving trades)
- Sustainable long term (hard to initiate new strategies/wind down old ones when using size like WL treasury)
- Prepared for prolonged downturn in crypto
at 0.25-1% of profits of a trade/strategy, I think treasury operators are not properly incentivized to generate the types of strategies that are most suitable for WL treasury. For example, a quantitative market neutral strategy might be expected to generate 10% over a year, which is a great return, but would result in only $30,000 for the strategy initiator at 1% of profit on a $30mn investment.
This is not great compensation for what is great value being added to the treasury (it is REALLY HARD to generate a market neutral 10% return at size!)
- Pay the Treasury Operators more, a scale according to complexity of the trade, ranging from 2-5% of quarterly profits, and additional 0-5% discretionary bonus voted on by community at end of year
- Acknowledge the difficulty in investment by committee and with the size of the WL treasury, and focus on more suitable investments (less trading, more sustainability)
I see where you’re going with this, and I agree that sounds like a very good idea. I was under the impression that TO’s and trade teams would only use private channels for confidential stuff - most comms should be had publicly to ensure the community is in on the action. There is more liability for TO’s and trade team members when they propose, develop, and deploy Any strategy privately. Communicating openly in real time is the best way to ensure they’re always acting in holder’s interests. I realize now that I never put language in there to articulate this and it might not have been reasonable of me to assume all TO’s and trade team members would automatically act in this way.
Especially considering the private channels are specified, it may be prudent for us to further indicate our intention that these channels shouldn’t be the standard form of communication for team members - they should use public channels as much as possible and get community input in the high majority of situations.
The holder alpha channels sound like a good idea that I think we should develop further in another proposal, in addition to other cool ways our community can trade alongside us. I’m going to spend some time trying to consider language that could be inserted into this proposal, to make it clear that strategy discussions should primarily be held in public channels and better specify that the private channels should be used sparingly. Do you think that would help here?
I think that we should organize a budget/trade wallet for quick trades, as it‘s only favorable to the protocol to be able to do that, imo.
Not 100% sure on the how and what and how much - but I feel that (considering the TO‘s will be doxxed internally) there should be a way to ensure safety and efficiency for trades like that.
I think you make a lot of valid points. Personally though I still like VC/seed investments…even if the payoff takes awhile the return is typically worth it…BSGG is a great example as we quickly were in profit on that deal thanks to Sifu. Given the market conditions going forward, the payoff will likely be longer on VCs as you stated, but I think it may still be worth the risk as long as the treasury allocation is a small %. The real issue with VC investments is you need a specialist with extensive experience to evaluate these deals as they can be pretty complex. Regarding the ability to make quick trades, you have a valid point although I think the main focus of team trading would be a bit more mid/long-term oriented (farming allocations and moving positions accordingly). There are a lot of good opportunities here that are not “quick trades”…e.g. farming tokens such as GLP, stables, etc. I don’t think the focus should be “day trading”…but there are some examples where quick entry/exit and timing are critical–for instance if you’re trying to arbitrage a MIM depeg for example. Bamchicka also provides a good solution where we could have a DAO approved allocation for quick trading if that’s something we decide on with specific limitations and guardrails to reduce risk exposure. I also think the profit % might be a bit on the low side, given the value added so I agree with you there as well. As a comparison, a TM would usually take a 10% cut of profits, so I think 0.25-1% may be a bit low.
I agree small allocation for directional trading could make sense.
But the trader must be very good for the risk of having a non multi-sig wallet.
I was going to respond with much of what @Deal already said. I’m not sure if it would be better to have a different proposal to further flesh out some capabilities for a trade wallet - for both TOs and TMs. It may be useful to have this kind of thing set down for anyone managing the treasury in the future.
I’d like to alter the Reward section of this RFC to increase the % TO’s and Trade Team Members are eligible for, as @yieldchad recommended. What do you think of this change:
“To incentivize Treasury Operators and Trade Team Members to develop and present profitable trade and investment opportunities, they should be eligible for 3% of profits from strategies they propose, if the strategy is approved and deployed.
Treasury Operators and Trade Team Members should be eligible for an additional 3% of profits from strategies they propose and deploy if the community approves that bonus in a separate WIP describing the strategies and performance for each member, to occur immediately before redemption periods.
It should be noted that TO’s and Trade Team Members should reasonably expect to receive these bonuses when they are working in good faith. Continuous disapproval of bonuses should signal the need for that member to be removed or replaced.”
Can I get everybody’s input on that?
- This is a good change for Trade Rewards
- Too much %
- Too little %
- I don’t like something else
I would also like to edit the Duration and Accountability section to include language that makes it clear TO’s and Trade Team members should use public channels as often as possible, as @isthatlowfat suggested. What do you think of this addition to the end of that section:
“It must be noted that Treasury Operators and Trade Team Members are expected to communicate with the community about strategies before deployment in the majority of cases. Under limited conditions, it may be reasonable for Treasury Operators and Trade Team members to maintain a level of discretion in a designated team channel, but this mechanism should be used only when absolutely necessary.”
Can I get everyone’s input on this?
- This seems sufficient
- Needs to be better defined
- I don’t like something else
I’d mention private channels nd not all stats be public knowledge before execution to prevent front running. But generally public convo is good but has to protect integrity of strats pending execution.
As mentioned in discord define these limits n caps better as in per strategy etc. And max cap per strategy = x%
@MattMacGyver Discussing all investment matters beforehand in a public manner is a bit risky. So many aspects like buybacks and other investments can be front run and also this might create unnecessary drama in the community. Could also potentially dissuade trade team members from freely discussing ideas for fear of judgment or bias. I’m all for sharing information and investment ideas but at the right time.
RFC has been approved for WIP: