Treasury Update 2

Overview

ValiDAO is committed to transparency, and as part of this commitment, we are pleased to present the second edition of our monthly treasury and liquidity report. This document aims to offer DAO members a detailed and accurate view of our project's financial status, covering both holdings and liquidity. This initiative is a testament to our dedication to providing members with the necessary information to make well-informed decisions and to fully comprehend the financial foundations of our project.

ValiDAO Treasury

The ValiDAO treasury consists of 3 core holdings: VDO, ETH and UniV2 VDO/wETH LP tokens. These holdings fluctuate based on expenses, trading fees from LP and revenues. Each token may vary in price and thus the dollar denominated value of each holding varies based up this.

Total Treasury Value & Composition

The current ValiDAO treasury value is $1,877,660 and the composition of it is as follows:

Over the past month the treasury market value has stayed relatively flat, starting at $2,066,643 and ending at $1,877,660 million, this represents a roughly 9.14% decrease in the treasury value. The variance here is mostly related to the prices of the underlying tokens (VDO & ETH). The treasury achieved an intra-month peak exceeding $3,630,306 shortly after we initiated our Eigenlayer delegations. This surge coincided with the Celestia Foundation delegating 3,000,000 TIA to ValiDAO’s Celestia operations, valued at approximately $34 million at that time.

It’s important to note that, over the past month, the treasury allocated a higher than usual amount of funds towards various expenses. A significant portion, approximately $25,000 USD, was spent on a legal firm retainer, while an additional $3,100 was allocated for general counsel services. Salaries accounted for around $14,000 of the total expenditure. The treasury also spent $2,200 on Twitter Verified Organization applications (one failed; second approved) and moved $3,200 in ETH towards Eigenlayer. A sum of $10,000 was used to refill the Cosmos wallet, covering on-chain expenses such as relayers and REStake. Infrastructure costs included a $9,000 quarterly payment for Iceland servers, covering the next three months for a portion of our infra there, and $10,000 for general expenses, including the portion of our infrastructure not located in Iceland, subscriptions, and expenses for attending Token 2049 and SEABW. Additionally, $3,000 was spent on merchandise, and $8,000 was allocated for the Sophon node sale. It is important to note that while this month's expenses were exceptionally high due to the one-time legal retainer payment, which should cover most if not all of the incorporation costs, this is a one-off payment and going into the future, less than that amount will be allocated yearly for directors and supervisors at the incorporated entities.

When looking at the composition of the treasury, we can see that the relative proportion of each holding remained relatively constant throughout, with VDO tokens making up the bulk (68.2%) of the treasury:

Reviewing the individual assets within the treasury, we observe that the VDO balance was flat month-over-month, showing a 0% growth rate.

Meanwhile, the ETH balance concluded the month with an increase of 9.1%, with intra-month highs of 40% growth. A few key events contributed to this variance:

1. ValiDAO purchased 2.785 ETH worth of Sophon Keys, becoming a tier 6 node operator for the Hyperchain on zkSync.

2. ValiDAO earned 32.81 ETH in Trading Fees

VDO Liquidity

The total liquidity pool size for VDO/ETH is currently $908,00. Since it is a UniV2 style LP, the composition of the pool is exactly 50/50 VDO/ETH.

Throughout the month, we can see how these LP reserves fluctuated:

ValiDAO maintains a significant liquid stake in the UniV2 VDO/ETH LP, with its value subject to fluctuations due to trading fees accrued and the prevailing prices of the underlying tokens. Over the course of the month, the LP's value generally remained stable, though it closed the month with a market value slightly lower, by a few percent, compared to the beginning of the month.

ValiDAO owns all of the LP, but has a substantial amount of their holdings locked in unicrypt Currently, ValiDAO’s locked LP makes up 46.91% of this LP.