Using public, time-locked OTC offerings to raise funds without market selling tokens.
0x80d1
June 1st, 2022

For DAOs/Treasuries, token teams, and web 3 startups

The native token dilemma

DAOs/Treasuries have gained massive wealth over the last two years, much of which has been in the projects native token. This creates a native token dilemma, where the project has a large treasury that resides in a highly volatile, illiquid asset that needs to be converted to more stable coins, but is forced to do so through means that create negative price impacts and poor market sentiment from community members. This leads to projects holding more tokens than they should, and not building up the stable coin reserves/diversified treasuries required to build and grow in changing market conditions.

Courtesy of Bankless
Courtesy of Bankless

The problem with DAOs/projects selling tokens

Selling native tokens for stable coins isn’t something projects or communities want. At any volume it creates negative price impacts which can in turn create instability in the community of the DAO. But what other solutions are there? Once a token project is live the primary pathway to converting native tokens to stables lies in either market selling or private OTC deals with large investors.

Selling tokens off-market with Hedgey OTC

At Hedgey, we’ve taken the concept of Over-the-counter (OTC) and democratized it to create a new frontier in DAO financing and the communities that support those DAOs.

  1. **Sellers create Public OTC offering on **app.hedgey.finance
  2. OTC deal is broadcast across the Hedgey protocol, widening its exposure
  3. Buyers purchase locked tokens through the OTC deal
  4. Seller receives payment upfront
  5. Buyer receives NFT that acts as their access key to locked tokens

Hedgey OTC allows DAOs to generate income by selling native tokens through public (multiple buyers) time locked OTC offerings on their token. This means that the DAO is able to generate revenue today, while controlling how and when tokens enter liquid markets.

Better token deals for project contributors

Buyers of these OTC deals can now be not only large investors, but active contributors to the DAO/token project. Public OTC offerings allow contributors to access off-market token deals, that may include discounts to market price in exchange for a lock up period.

In a new primitive, buyers of OTC deals mint NFT access keys that act as transferable ownership of locked token positions. This creates more flexibility for buyers, while also protecting the interests of the DAO community.

How to get started

Hedgey OTC is a permissionless contract. There are no platform fees or listing fees. Any token on 8+ chains can self launch public OTC deals at app.hedgey.finance

If you want support or have questions, hop in our discord and chat with the Hedgey crew.

Arweave TX
ktKTB09Qrfpaw-72tGdEWxyOr259Mrl2yqoLixYcQfg
Ethereum Address
0x80d16d7450246bE31185e1A7eb551Ea573d5b20a
Content Digest
aiskMmFmF1MXqTMrA0bLbisU1SN8WLj_-LVCU8Mt7NQ