Alpha-DAO

One of the most frequent questions we have been asked the last couple of weeks is “what is Alpha-DAO?”. To put it simply, it is a challenge we are going on for next year and we’re starting a little bit earlier than intended. The goal? To 50x the capital allocated to the DAO by the end of 2022.

But how exactly will this be achieved? What will Alpha-DAO look like? What will be the structure?

The purpose of this report is to explain and provide some detail around the mechanics of Alpha-DAO. Additionally, we will detail the proposals that have already passed and show the format that we will be working with going forward.

 

Disclaimer: This is not investment nor investment advice. Only you are responsible for any capital-related decisions you make and only you are accountable for the results.

 

TLDR

  • Alpha-DAO is a Decentralised Autonomous Organisation consisting of six members originating from the CPro research team.
  • The purpose of Alpha-DAO is twofold:
    • To formalise a process for presenting potential investments to the rest of the DAO.
    • To formalise a process for acting on these potential investments.
  • Any member of the DAO can propose an investment or structural/parameter change. There are no limitations on the type of asset that can be proposed – anything crypto related is fair game.
  • We have funded the portfolio with $100,000 with the goal of turning that into $5 million over the course of 2022.
  • 8 Proposals based on parameters and structure have passed – more info in this report.
  • Wallet addresses are enclosed at the end of the report.

Structure, Goals, and Targets

The CPro research team has grown significantly throughout 2021. Starting off with just two researchers at the beginning of the year, we have grown to a team of 6 talented individuals each with their own unique specialties and skill set. As a research team, we are constantly bouncing ideas off each other and sharing our findings. Whether that be new assets, IDOs, NFT mints – the entire crypto market is ripe with opportunity.

However, due to the informal nature of these discussions we fail to act on a lot of these potential investments and a large number of them are lost in translation. In this regard, the purpose of Alpha-DAO is twofold:

  • To formalise a process for presenting potential investments to the rest of the DAO.
  • To formalise a process for acting on these potential investments.

Simply put, Alpha-DAO is a Decentralised Autonomous Organisation. We have funded the portfolio with $100,000 with the goal of turning that into $5 million over the course of 2022. The portfolio will be completely transparent, and everything will be on-chain which CPro members will have access to view. Here’s how it works:

  1. Any member of the DAO can propose an investment or structural/parameter change. There are no limitations on the type of asset that can be proposed – anything crypto related is fair game.
  2. The rest of the members of the DAO will have 72 hours to review the proposal and cast their vote. There are three options for voting: YES, NO, ABSTAIN.
  3. If a proposal receives a majority, then that proposal will pass, and the execution of the strategy outlined in the proposal will begin.
  4. There will be 3 categories for proposals – investing in an asset, divesting from an asset, and DAO structural/parameter changes.

The plan is to have the voting mechanism on the Solana blockchain, and Alpha-DAO will have its own website where voting can be viewed. All research reports will be posted on the Cryptonary website for CPRO members to view – even if the proposal did not pass. We are really trying to provide as much transparency as possible, and we hope that Alpha-DAO reports will provide a deeper understanding of our thought processes and how we select potential investments from start to finish.

Proposals

There have been 9 proposals so far, with 8 of them being structural proposals to ensure that everyone in the DAO has had the chance to voice their opinion on the creation and parameters of Alpha-DAO. Here is an outline of the structural proposals that have been voted on:

Proposal #1

Title: Investment Parameters

  • Valuation Constraints: $50M – $500M (circulating)
  • Volume: $1M/day avg over the last 7 days

Reasoning

Optimal range for large growth without causing a direct market effect.

5 YES, 0 NO, 1 ABSTENTIONS – PASSED

 

Proposal #2

Title: Decisions Structure

  • Vote Snapshot Time: 72H

Reasoning

There are two aspects to take into consideration:

  • Time Sensitivity of buying
  • Time to Assess

72H gives every DAO member time to conduct their own research and brainstorm collectively should anyone have an opposing view without dragging on too long for an asset to have a significant price move if the investment is time sensitive.

4 YES, 0 NO, 2 ABSTENTIONS – PASSED

 

Proposal #3

Title: Alpha DAO Meeting (Date TBD)

Proposal Brief:

Set up a regular DAO meeting to ensure all members have the chance to discuss AlphaDAO business.

6 YES, 0 NO, 0 ABSTENTIONS – PASSED (Set for the first Monday of every month)

 

Proposal #4

Title: Stablecoin and Staking Strategy

Proposal Brief:

The creation of the fund’s stable coin and staking strategy.

Reasoning:

The quickest way we can start earning on our crypto is to immediately stake all PoS assets and convert all idle cash into stable coins, deploying them in various high yield, highly liquid, “low risk” strategies. All platforms and protocols utilized for yield will be subject to approval from the DAO.

5 YES, 0 NO, 1 ABSTENTION – PASSED

 

Proposal #5

Title: Transfer funds from ETH to UST Stablecoin

Proposal Brief:

Our funds are currently in ETH which is prone to volatility. Due to the recent price action we’re down around 10% (breakeven at $4800 ETH).

To avoid situations like this I propose we transfer all DAO funds at the earliest practical opportunity to Anchor (see Proposal 4) with the intention of remaining liquid with reduced risk and to set UST/USD as our base denomination.

Reasoning:

There’s no time delay on accessing funds so whenever we are ready to deploy capital for future investments it’s immediately liquid.

The main risk is that the contract is exploited. However, the length of time that all our capital will be in Anchor is not substantial as I expect investment proposals to be passed over the next few months.

4 YES, 0 NO, 2 ABSTENTIONS – PASSED

All idle funds are now in UST earning yield on Anchor protocol (Terra ecosystem).

 

Proposal #6

Title: Potential zkSync & ZigZag Airdrop

Proposal Brief 

The DAO will use the 10 ETH to bridge to ZkSync & interact with the decentralized exchange ZigZag. ZkSync is a Layer 2 scaling solution on Ethereum that offers low gas and fast transactions without compromising on security. It currently doesn’t have a token, but it will release a token next year. There is a chance of this including an airdrop to users. ZigZag Exchange is currently the only DEX on ZkSync and doesn’t have a token. This could also be a potential airdrop.

Reasoning:

It is known that ZkSync is releasing a token & it could be a potential airdrop for users.

ZigZag is currently the only DEX on ZkSync, and it also doesn’t have a token (yet)

The R: R on the potential airdrop is good as the gas fees & ZigZag’s exchange fees are the only costs & the reward could be high (4-5 figures).

4 YES, 0 NO, 2 ABSTENTIONS – PASSED

This article will explain to you exactly what actions will be performed & how:

https://medium.com/@CalendarDefi/airdrop-guide-zksync-zigzag-a83ef3b33b70

 

Proposal #7

Title: Metamask Airdrop

Proposal Brief:

MetaMask will decentralise sometime in the future (est 2022) which means they will release a token. The protocol has been in the Top 5 by revenue regularly throughout 2021, the source comes from the 0.875% they charge on every swap made through the user-friendly DEX aggregator.

Reasoning:

Given how the majority of old token-less protocols decentralise, the odds of an airdrop are high.

Cost

The cost of swaps is high and will be around $100-$200. Karim will be sending (~$400) to cover these costs.

4 YES, 0 NO, 2 ABSTENTIONS – PASSED

 

Proposal #8

Title: Change Investment Parameters

Proposal Brief:

The DAO will change investment parameters to:

  • Valuation Constraints: $10M – $500M (circulating)
  • Volume: No Volume Constraints

Reasoning:

The current parameters for DAO investments are as follows:

  • Valuation Constraints: $50M – $500M (circulating)
  • Volume: $1M/day avg over the last 7 days

This severely limits our upside potential as there are many useful and productive protocols with great potential, but the market hasn’t reacted yet so the MCap is low and the volume isn’t there.

Specifically, the lower bound for volume and valuation prevents us from investing in ground level assets.

5 YES, 0 NO, 1 ABSTENTION – PASSED

 

Conclusion

With these proposals passed, the parameters of the DAO are as follows:

  • Potential investments (tokens and coins) must have a Market Cap of at least $10 million, and no more than $500 million. Volume will be analysed on a case-by-case basis rather than any set parameter.
  • There will be a DAO meeting (via Zoom) on the first Monday of every month to discuss the state of the AlphaDAO and to voice any opinions/concerns.
  • Idle funds have been stored in the UST stablecoin and staking on Anchor protocol for a yield of 19.51% per year.

The addresses currently in use are as follows:

  • Ethereum: 0xdE0579D783aE175c8DCA097B729AE4b2eB29863a
  • Terra: terra1ds74uje3gaahu7u426tve8crt76jcxyf6xv52c

The Ethereum address can be viewed on any Ethereum Blockchain Explorer, such as EtherScan.

The Terra address can be viewed on any Terra Blockchain Explorer, such as Finder.Terra.

 

We are excited to see what the future holds for the AlphaDAO and we believe that CPRO members will benefit from all the juicy ALPHA shared with them on our journey throughout 2022!

Disclaimers

This is not financial nor investment advice. Only you are responsible for any capital-related decisions you make and only you are accountable for the results.

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