Feb 15, 2023

LidoDAO Deliberates on $30M ETH Treasury Management

The decentralized autonomous organization behind Lido, the largest Ethereum staking pool, is currently debating the best way to manage its $30 million in Ether (ETH).

The proposal, submitted on Feb. 14 by Steakhouse Financial, the DAO’s financial unit, considers four possible options, one of which is to stake part or all of its ETH on Lido in the form of Lido Staked ETH (stETH).

The other option is to sell part or all of its 20,304 ETH for a stablecoin, to extend the DAO’s runway.

The proposal comes at a time when ETH staking withdrawals are expected to be enabled through Ethereum’s Shanghai and Capella upgrades, sometime early this year.

However, the DAO is wary that too much staking may leave it without enough Ether on hand “in case of need”.

Steakhouse Financial noted that with LidoDAO’s current inflows at about 1000 stETH per month, the DAO is making approximately $1.3 million to 1.5 million per month with the price of ETH hovering between $1,100 and $1,700 over the past few months.

Steakhouse Financial said those figures alone should be “sufficient to cover monthly operating expenses”, but they are still debating whether it is worth converting excess stETH into a stablecoin to better prepare for any change in market conditions that may lead to increased operating expenses.

A business development representative from LidoDAO said that they have issues with the liquidity of LUSD and USDT, which both pose potential risks if they become frozen.

It appears as though most LidoDAO members are in favor of partially selling and staking a portion of the 20,304 ETH locked in its Aragon smart contract.

The total value locked (TVL) of stETH fell 6.66% from Feb. 6 to Feb. 13. The TVL of Lido is currently $8.13 billion, according to on-chain metrics platform DeFiLlama.

The proposal comes as NFTs and crypto-based marketing strategies become increasingly popular. With the rise of NFTs, many companies have started to explore ways to promote their products and services through NFTs.

One such company is LidoDAO, which is exploring the possibility of using its treasury to invest in NFT promotion and marketing.

The DAO is considering using its treasury to invest in NFT marketing campaigns on Twitter, as well as in hiring a specialized NFT marketing agency to assist in the promotion of its products and services.

By investing in NFT promotion and marketing, LidoDAO hopes to increase its visibility and reach a wider audience. The DAO also hopes that the investment will help it sell more NFTs and generate more revenue.

In addition to NFT promotion and marketing, LidoDAO is also exploring the possibility of investing in a specialized web3 agency to help it navigate the web3 space.

By investing in a web3 agency, LidoDAO hopes to gain access to specialized expertise and knowledge that will help it maximize its returns and capitalize on the web3 space.

Ultimately, LidoDAO hopes that its investments in NFT promotion and marketing and web3 agency services will help it increase its revenue and further its mission of decentralizing finance.

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