TLDR: Below is draft text for a $1m extension of the buyback program, This proposal also sends 345 ETH to DXdao Dev Multichain multi-sig by way of the correct ETHRelayer contract. Some small changes to rules governing purchase sizes
The DXD Buyback Program was passed by REP holders in May of this year. Since then, 10,153 DXD have been purchased on mainnet and Gnosis Chain for an average price of 0.164 ETH/DXD. Using the USD price at the time of purchase, $5.5m of DXD has been purchased. This is just over 20% of the DXD circulating supply.
The buyback program was updated in June to increase the slippage tolerance of trades as well as clarify the accounting measures. The buyback program has since been extended five times. The total amount of DXD purchased is approaching the limit placed on it by the previous proposal and soft community consensus has demonstrated support for another $1m extension.
Accounting for the 10,153 DXD purchased and the 461 DXD that has been issued to contributors in vested contracts, the 458 DXD that has been issued to LPs for Swapr farming and the 1985 DXD in unissued DXD compensation, the outstanding DXD supply (42,453 DXD) represents a market cap of $22.9m - still comfortably below the $46m in ETH and stables in the DXdao treasury and the $7.8m in the buyback reserve. The buyback program is intended to address this discrepancy and acquire an undervalued asset.
In line with the most recent buyback extension the mainnet signal proposal is also sending the funds necessary to complete the buyback, and as with the previous transfer, these are being sent directly to the GP relayer on Gnosis Chain. This proposal also sends the ETH needed for this buyback extension to the Multichain multi-sig (via the ETH relayer).
Additionally, this proposal also enables buyback order volume sizes to account for delays in buyback order submissions. Buyback order submissions can be above the 25% ADTV amount in the event that the previous week saw buyback orders who’s total purchase size was less than 125% of the DXD ADTV. These proposals should make a note of the increased purchase size and should not exceed 60% of ADTV.
This proposal extends the DXD Buyback Program for another $1m to $7m total under the same conditions outlined in the original Buyback Program signal proposal and the parameter update . It also authorizes additional parameters around purchase size and weekly DXD trade volume.
This proposal ends 345 ETH to the ETHrelayer contract for the multichain multisig, identified as, 0x3e99bEd13071176fE06b317b33e2dcd1E1c9f2BE , which will relay the ETH to the Multichain multisig address, previously identified as 0x9467dcFD4519287e3878C018c02f5670465a9003 whose signatories have been verified as REP holders, which will convert it to WETH and bridge it over to be deposited into the GPv1 relayer on Gnosis Chain, 0xA369a0b81ee984a470EA0acf41EF9DdcDB5f7B46.
These and other DXD purchases through the Buyback Program have contributed to the community’s intention to use the buyback reserve to purchase DXD. ETH from DXdao’s general treasury can be used in lieu of the buyback reserve until the DXD token contract is upgraded and that ETH is recovered. In total, the buyback reserve has 2,499 ETH and so far, 1669 ETH has been used to purchase 10,153 DXD through the buyback program.
The community is discussing the future of the DXD buyback program and welcome input.
The program will take place on Gnosis Chain, a sidechain with less security properties than Ethereum. The Buyback Program has been running for over half a year with few problems; the GP Relayer has worked to complete the purchases at the market price. There is a concern that Gnosis Protocol v1 on Gnosis Chain will have limited support, but DXdao community members are striving to maintain the network of solvers. The community is also exploring additional options
DXdao has already spent over $5.6m repurchasing DXD. This has increased the price of DXD relative to ETH but it still falls below the book value of ETH in the treasury.
Full execution of this proposal relies on the Multichain multi-sig, which has already bridged and transferred millions of dollars of assets to Gnosis Chain.