Funding Gnosis Chain Base - $1M Transfer

This proposal suggest transferring the $1M USDT currently in the DXdao mainnet treasury over to Gnosis Chain.

Details

Most contributors claim their worker proposals payments as well as DXD vesting on Gnosis Chain. DXdao has now had a presence on Gnosis Chain, formerly xDai, for well over a year.

Typically we gradually funded the GC base with 250 - 500k stables. This proposal suggests moving over $1M split as follows:

  • 60% DAI
  • 40% USDC

These funds should suffice to operate DXdao until the end of this year. DXdao can also do trustless trades on Gnosis Chain should the need arise to swap between USDC and DAI.

This proposal sends $1,053,664 USDT to the DXdao omni-chain MS: 0x9467dcFD4519287e3878C018c02f5670465a9003

Risks and considerations

Transfer of these funds relies on the multi-sig. Gnosis Chain also presents risks because security is dependent on its limited validator set. Additionally, cross-chain bridges are still new and not battle-tested.

8 Likes

I support offloading the USDT from the treasury, as there has been some uncertainty around the quality of Tether’s backing, a decline in Tether’s marketcap (issuance) over the last month from $72.5B to $66B, and continued tightening of monetary policy and interest rate hikes by the US Federal Reserve. The failure mode that I think represents some tail risk in holding USDT is that USDT is not fully backed. If there’s a “run on the bank” and people begin to panic and significantly draw down Tether, then it will be put to the test. And in the event it isn’t fully solvent, we don’t want DXdao to be the last one out the door. I believe the Federal Reserve’s actions could induce market participants to want to redeem their USDT for dollars and seek yield elsewhere. And we have seen the speed with which systems can unwind. Given DXdao’s process of finding consensus can take 8 days or more, moving out of USDT now is a wise move.

4 Likes