- Summary - ShapeShift DAO and 1Hive DAO will execute a community swap of approximately $100,000 in equivalence of FOX and HNY (1Hive’s native token). Two DAOs partnering to provide liquidity is extremely powerful, especially when the culture and motives are aligned. By performing the respective DAOs’ token swap (herewith referred to as DAO2DAO, or “D2D”), we share the risk and rewards of the two DAOs.
- Abstract
An excellent writeup of the mechanisms of a “D2D Collaboration/Joint Venture” by PrimeDAO can be read here. A great summary by Kyle from 1Hive of what a D2D venture would look like can be read here.
In other words, both communities now are rationally incentivized to act in the other community’s interest, because they both own a stake in the other. Each community has also hedged their own risk, by transferring some of that risk to the counter party community. This act marries the two communities together.
$100K of tokens will be swapped ($100K of HNY for ShapeShift, $100K of FOX for 1Hive). Without changing the overall balance sheet of the respective DAOs, we are able to provide much more liquidity because it would be in the best interest of our shared risk and reward.
In addition, this joint venture opens up new doors for future potential projects which would be mutually beneficial to ShapeShift and 1Hive.
- Motivation
There have been calls by the community and an overwhelming support in general for an incentivized FOX pool on xDai.
A joint venture with 1Hive, the operators of HoneySwap, is a very rational move by ShapeShift DAO, as they are the largest and most liquid DEX for the xDai network, which our DAO is so heavily reliant on for payments.
- Specification
The 1st of 2 proposals on 1Hive’s side is set to pass by the time this proposal goes live: 1hive proposal
Because of how 1Hive’s governance and treasury works, a second proposal would need to pass to send the amount of HNY required for a full $100K swap.
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350 HNY (approximately $100K) will be sent to a 6-member multisig, in which 3 signatories are from ShapeShift and 3 signatories are from 1Hive. Four signatures will be required for the execution of any multisig transactions. The proposed signatories on the ShapeShift is: willyfox, jonshapeshift, and mperklin.
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665K FOX, assuming this proposal passes, would be moved to the aforementioned multisig. The amount was pegged at 950 FOX / HNY, as historically the price of HNY and FOX have ranged between 900-1000 FOX/HNY and the1Hive treasury needs to vote to move funds, and the process takes time.
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When the 2nd vote passes on 1Hive DAO, another 350 HNY will be unlocked and sent to provide liquidity.
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Liquidity will then be added to the HNY+FOX pool — 50% of the resulting LP tokens would be sent to ShapeShift DAO’s treasury, and the other 50% to 1Hive DAO’s treasury.
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This is where the power of a D2D collaboration comes into play — because our alignment of interest, the resulting liquidity would be approximately $400K.
If at any point there is a misstep, miscommunication, or misalignment, assets would be returned back to the respective DAOs and the project re-evaluated.
Time and Work Compensation: This proposal is the result of over a month of coordination, planning, and ideation from both sides of the DAO. Therefore, we have agreed that compensation for our time and efforts should be considered. We are requesting $2.5K in FOX to be split amongst myself (2/5th), monstrosity (2/5th), and kyle (1/5th).
- Benefits
- More liquidity for contributors and leaders that are paid by the DAO
- Diversifying the DAO’s treasury while partnering with another respected DAO
- More liquidity of FOX on xDai at a “discounted price”
- Drawbacks
- Taking on the risk of another DAO’s success
Links
Vote
YES - Allocate 665K FOX for the D2D joint venture, and compensate the parties involved in the making of this proposal.
NO - No action.
