Creator DAO Treasury

The treasury's primary function is to allocate capital to projects proposed by the community. This is typically managed through a grant program or proposal system where members submit ideas for funding. Key mechanisms include:

• On-chain voting to approve proposals.
• Multi-signature wallets for secure disbursement.
• Milestone-based payouts to ensure accountability. Examples include funding a new video series, commissioning artwork, or developing community tools.

Treasuries automate and decentralize payment for work. Instead of a central entity paying creators, the DAO uses its treasury to reward contributions through:

• Streaming payments via tools like Sablier or Superfluid for continuous rewards.
• Bounties for specific, completed tasks (e.g., graphic design, writing).
• Revenue-sharing models where a percentage of primary sales or royalties is distributed to key contributors and token holders. This aligns incentives and ensures creators are directly rewarded by their audience and community.

To ensure long-term sustainability, DAO treasuries often deploy assets to generate yield, acting as an endowment. Common strategies include:

• Providing liquidity to Decentralized Exchanges (DEXs) like Uniswap to earn trading fees.
• Staking native tokens or other assets in proof-of-stake networks.
• Depositing stablecoins into lending protocols like Aave or Compound. These activities turn idle treasury assets into a source of recurring revenue to fund ongoing operations without constant dilution.

Treasuries are used to acquire key assets that benefit the collective, such as:

• Historical NFTs from the creator's own collection to control secondary market royalties.
• Generative art or 1/1 pieces to be used as community rewards or displayed in a virtual gallery.
• Intellectual Property (IP) rights, purchased and held by the DAO for communal use and licensing. This turns the treasury into a strategic asset holder, increasing the collective's cultural and financial capital.

The treasury is central to a DAO's tokenomics. It manages the supply and distribution of the governance token, which controls the treasury itself. Key functions include:

• Treasury-backed value: The token may be redeemable for a share of the treasury's assets.
• Buybacks and burns: Using revenue to buy and burn tokens, creating deflationary pressure.
• Liquidity mining: Incentivizing liquidity pools to ensure healthy token markets.
• Vesting schedules for team and early contributors to align long-term interests.

Funds are allocated to cover the essential costs of running the decentralized organization. This includes:

• Paying for infrastructure (hosting, domain names, API keys).
• Subscriptions to DAO tooling platforms like Snapshot (voting), Coordinape (reward distribution), or Collab.Land (token-gating).
• Legal and administrative expenses for entity formation or compliance.
• Funding community managers and moderators. These are the 'overhead' costs that enable the DAO to function smoothly and professionally.

Protocols that allow DAOs to generate yield on idle treasury assets. This involves deploying funds into liquidity pools, lending markets, or staking mechanisms to earn interest or rewards, turning static reserves into a productive asset that can fund ongoing operations.

• Common Tools: Aave, Compound, Uniswap V3.
• Risk Management: Strategies range from conservative (stablecoin lending) to more complex (LP positions).

Specialized tools for managing NFT-based assets within a treasury. This includes platforms for fractionalizing high-value NFTs (via Fractional.art), insuring them, or using them as collateral in lending protocols. It addresses the unique challenge of liquidity and valuation for NFT holdings.

• Key Concept: NFT Fractionalization splits an NFT into fungible tokens, enabling shared ownership and easier trading.
• Utility: Unlocks capital from otherwise illiquid digital collectibles or art.

Governance is executed through on-chain proposals, where token holders vote to approve treasury expenditures, investments, or parameter changes. Key mechanisms include:

• Snapshot: For gas-free, off-chain signaling votes.
• Governor Bravo: A standard for on-chain, executable proposals (e.g., transferring funds).
• Voting Periods & Quorums: Minimum thresholds that must be met for a proposal to pass, preventing low-participation decisions.

A major governance consideration is managing the treasury's asset composition, which often starts as a large holding of the DAO's native token. Key risks and strategies include:

• Volatility Risk: Overexposure to the native token's price swings.
• Diversification: Proposals to swap tokens for stablecoins (like USDC) or other blue-chip assets to ensure runway.
• Yield Strategies: Using DeFi protocols for yield generation, which introduces smart contract and liquidation risks that must be carefully governed.

Smart contract-based treasuries implement granular permissions beyond simple multisig. Using frameworks like OpenZeppelin's AccessControl, different roles can be assigned:

• Treasury Manager: Can create payment streams or execute approved, routine transactions.
• Proposal Creator: Can submit spending proposals for vote.
• Emergency Multisig Signer: Holds keys for a timelock bypass in critical situations. This separation of powers enhances security and operational efficiency.

A timelock is a critical security feature that enforces a mandatory delay between a proposal's approval and its execution. This creates a "cooling-off" period allowing the community to:

• Review the final executed code of the transaction.
• React to malicious or erroneous proposals that may have passed.
• Exit the DAO if they disagree with the pending action. Timelocks are a primary defense against governance attacks.

A governance token is a crypto-asset that grants its holder voting rights within a DAO. For a Creator DAO, these tokens are often distributed to fans and contributors, allowing them to propose and vote on treasury allocations.

• Function: Token-weighted voting on proposals (e.g., fund a new project, set contributor pay).
• Value Alignment: Aligns community incentives with the creator's long-term success.
• Examples: $JAMM (Jammable), $FWB (Friends With Benefits).

Treasury management encompasses the strategies and tools used to preserve, grow, and deploy a DAO's capital. For Creator DAOs, this balances liquidity for operations with long-term asset growth.

• Core Activities: Asset diversification (stablecoins, NFTs, native tokens), yield farming, and liquidity provisioning.
• Tools: Protocols like Aave (lending) and Balancer (liquidity pools).
• Goal: Ensure the treasury is a sustainable engine for funding community initiatives.

A funding proposal is a formal, on-chain request to allocate treasury funds, typically created and voted on via a governance platform. It is the primary mechanism for executing the DAO's will.

• Typical Structure: Problem statement, requested amount, deliverables, and timeline.
• Platforms: Snapshot (off-chain signaling) and Tally (on-chain execution).
• Process: A proposal passes once it meets a quorum and a majority vote threshold.

A vesting schedule is a smart contract that releases tokens or funds to contributors over a predetermined period. It's crucial for aligning long-term contributions and preventing immediate sell-pressure.

• Common Structure: 1-4 year linear vesting, often with a cliff period (e.g., 1 year cliff, then monthly vesting).
• Purpose: Retains key talent and ensures commitment to the DAO's roadmap.
• Tools: Sablier or Superfluid for streaming payments.