Lets start this discussion with data from top DAOs in the world. Please see this report by DK regarding the highest TVL DAOs that deploy sophisticated DeFi strategies to increase Treasury TVL and the value of each DAOs native token.
There are 3 categories of available options to deploy BrainDAO Treasury funds into DeFi strategies for the purpose of growing BrainDAO Treasury TVL while also sustainably increasing the value of IQ over time.
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Deploy ve-staking position(s) and then direct token emissions towards strategic IQ liquidity pools as well as to collect high-return Treasury revenue from overly incentived voting options. Top examples include veCRV, veVELO, veBAL and veFRAX.
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Deploy additional Protocol-Owned-Liquidity using Treasury held IQ and other Treasury tokens like frxUSD, ETH and WBTC.
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Incentivize strategic IQ liquidity pools such as IQ-WBTC and IQ-ETH using IQ emissions or IQ Bonds.
Regarding catageory 1 options for BrainDAO strategies, the BrainDAO is already utilizing its partnership with FRAX to direct some of FRAX protocols veCRV emissions to strategic IQ liquidity pools on Curve. The IQ protocol is also the second largest holder of FXTL points, which means that soon the BrainDAO will have a large and growing veFRAX position that can be used to direct FRAX and CRV emissions to strategic IQ liquidity pools.
The BrainDAO may find great financial benefit from deploying veBAL and veVELO position in order to direct incentives and earn revenue from Balancer and Velodrome platforms in addition to FRAX and Curve incentives. I suggest that the BrainDAO deploy a small $100K position into veBAL, veVELO, and veCRV, and then Monitor total impact caused by each position. Then increase the highest performing position(s) over time.
Regarding options within Category 3, directly incentivizing liquidity, I think these options are the least effective over time. The BrainDAO has already matured beyond the point where it needs to directly incentivize IQ liquidity.
If anything, the BrainDAO can use temporary IQ liquidity incentive programs strategically, when IQs value is relatively high and the BrainDAO wants to liquidate IQ holdings for other tokens, or when certain tokens are rising rapidly.
Deploying BrainDAO Protocol Owned Liquidity is by far my favorite category of options. I think the BrainDAO should utilize 30-40% of its Treasury to deploy IQ POL, using token pairings such as IQ-sfrxUSD, IQ-sfrxETH, and IQ-WBTC.
If the BrainDAO deploys IQ POL using a properly configured network of specialized liquidity pool contracts, the BrainDAO can generate consistent added volume from arbitrage trading volume that will occur as the price of ETH and BTC fluctuate. This added volume can be converted into a major revenue source with high fee rate pools and appropriate levels of concentration.
By leveraging arbitrage swap volume with normal IQ trading volume, the BrainDAO can generate upwards of 15% APR on all of its IQ Liquidity. This revenue would be automatically compounded into increasing the value of IQ and BrainDAO Treasury TVL Simultaneously.
The revenue generated by BrainDAO POL can greatly offset IQ value depreciation from IQs minting and sale schedules.
Using a combination of BrainDAO POL with BrainDAO vestaking positions, the BrainDAO can eventually generate more IQ buying pressure to more then offset the IQ selling pressure caused by IQ being minted and sold by hiIQ stakers, the IQ protocol Team and the IQ DAO
Looks interesting, we do a monthly call to ensure we get the most yield that we can without taking considerable micro-managing of funds and ensuring risk is safe. I have some questions.
can you add numbers to the proposal? amount to deploy, from what asset and whats the APR expected for your strategies?
can you also add how thats better than current strategies? take also in consideration always risks of deploying in some protocols
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Ill work on formulating data for a precise set of potential Strategies according to the specifications youve asked for.
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As requested, a series of specific Treasury options with yield data, risk analysis and costs with direct comparisons to strategies already deployed by the BrainDAO. Starting with the simplest options and ending with the most complex.