RRC-XX: Treasury Management Empowerment Program

Proposals Parent DAO Proposals
#1

RRC-XX: Treasury Management Empowerment Program
Author: Anna Riabokon, Rari Foundation
Reviewer: Stable Labs, Campbell Law, Autonomous

Abstract

RARI DAO was initially established to foster decentralization and community-driven governance for the Rarible ecosystem. However, the current treasury management model under the DAO has limited our ability to swiftly respond to volatile market conditions, causing missed opportunities to effectively support and enhance the RARI token and ecosystem.

Specifically, our treasury structure has resulted in:

  • Delayed financial decision-making: Due to the inherent procedural delays in DAO governance, critical market-driven decisions have often been missed or delayed.
  • Limited agility in reacting to price movements: The inability to quickly deploy strategies in response to rapid market shifts has impacted token support and overall liquidity.
  • Suboptimal capital utilization: The cumbersome nature of the existing governance setup hinders efficient financial management and proactive treasury deployment.

We believe the framework outlined in this proposal offers a stronger foundation for Rari to operate with greater efficiency and effectiveness. By transitioning treasury management to the Foundation while maintaining DAO oversight, we can improve financial agility, strengthen the ecosystem, and position the project for long-term, sustainable growth. This framework will help Rari adapt to changing market conditions and continuously enhance its value to the community.

This proposal is intended to supersede and replace RRC-22 DAO Treasury Diversification Plan.

Motivation

  • Enhance Agility: Enable rapid and effective financial decision-making to proactively respond to market volatility.
  • Strengthen Token Support: Execute strategies that support a resilient and robust market environment for RARI.
  • Accountability and Transparency: Improved governance through clearly defined roles, responsibilities, and accountability metrics.

Rationale & Benefits

The market for tokens like RARI is highly volatile, and proactive treasury management is critical to optimizing financial outcomes. By transitioning the treasury to the Foundation, we ensure:

  • Proactive Market Response: Quick, flexible actions to take advantage of market conditions and opportunities.
  • Increased Token Stability: Strategic initiatives aimed at fostering a healthy market environment for the token.
  • Enhanced Community Benefit: Direct financial management improvements translate into tangible benefits for the entire RARI community through sustained token demand and increased buying activity.
  • Partnerships with Ecosystem Partners to Support Treasury Management: Foundation has the ability to effectively represent token holders interests in connection with contractual and legal processes.

Benchmark Examples

Arbitrum DAO Treasury Transition (2025):

In early 2025, Arbitrum DAO approved transferring 35 million ARB (~$11.6M) to the Arbitrum Foundation under its Stable Treasury Endowment Program (STEP 2.0). The goal was to diversify the treasury into yield-generating real-world assets (e.g., tokenized U.S. Treasuries) through institutional partners like Franklin Templeton and WisdomTree.

Why they did it:

  • To professionalize treasury execution
  • To reduce reliance on ARB token volatility
  • To generate stable yield
  • To enable faster, off-chain financial operations

Results:

  • ~$11.6M deployed successfully
  • Over $450K in interest earned within months
  • Full transparency via public reporting
  • DAO retained oversight, approving the strategy with ~89% support

This model demonstrates how treasury custody can shift to a Foundation without sacrificing community trust or governance transparency—making it a strong precedent for Rari.

ApeCoin DAO Experience (June 2025):

The ApeCoin DAO highlighted the importance of having clear governance scopes, strategic priorities, and operational agility. They recognized that DAOs should evolve progressively towards decentralization, emphasizing:

  • Scoped governance for key strategic decisions.
  • Role clarity and accountability in treasury management.
  • Milestone-based reviews for financial deployments.

Shifting its assets to ApeCo managed by Ape Foundation leadership, enhanced strategic clarity and enabled proactive treasury deployment. In Q1 2024, after restructuring treasury operations, ApeCoin saw a 21% increase in token price and a 31% growth in market capitalization.

The Sandbox DAO (SIP-1, May 28 2024): Allocated treasury assets to the Sandbox Foundation with a clear vesting and governance schedule. Following their May 2024 vote to transition treasury management, The Sandbox experienced price stability and significant growth, achieving a 139% increase year-to-date in 2025, demonstrating renewed investor confidence and strengthened liquidity dynamics.

These examples demonstrate tangible benefits, particularly in terms of token price stabilization and improved market responsiveness.

Proposed Structure for RARI DAO

We propose adopting a hybrid approach:

Transfer Treasury Control to RARI Foundation:

  • The Foundation will manage day-to-day operational budgets and treasury functions, ensuring agile capital deployment.
  • Foundation governance will be clearly defined, transparent, and reported to the DAO.

Scoped DAO Governance:

  • DAO retains strategic oversight, setting clear, high-level objectives and governance rules.
  • DAO votes on major protocol initiatives, community-driven initiatives, and governance frameworks.

Accountability:

  • Transparent financial reporting and milestone-based performance reviews shared regularly with DAO members.

Milestone‑Based Reviews for RARI

Milestone Timing KPI Benchmarks Review Mechanism
M1 – Treasury Transfer Month 0–1 Mainnet Treasury funds moved from DAO to Foundation multi‑sig & Audit completed Audit Confirmation and Forum Update
M2 – Initial Deployment Report Month 3 Treasury resource allocation strategy published Initial vendor/partner onboarding (e.g., custodians, ecosystem partners, analytics tools)
M3 – Quarterly Performance Every 3 months Execution progress update vs. strategic plan: token liquidity and trading activity tracked against historical baseline Community feedback on treasury use, partner performance, and operational efficiency
M4 – Annual Audit & Strategy Renewal Month 12 External audit + strategy ROI; 5% annual yield on strategic investments and increased RARI liquidity by 15% in 12 months. DAO on-chain vote on strategy + funding release

Benefits to the Rari Community

  • Efficiency: Faster response times on market conditions and reduced operational friction.
  • Clarity: Well-defined governance and strategic alignment.
  • Impact: Improved financial performance and accountability through milestone-based tracking.
  • Security: Enhanced treasury security and resilience.

Risk Assessment & Mitigation

Risk Description Mitigation Strategy
Centralization Risk Excessive control concentrated in Foundation The Director and Security Counsel retain veto rights. Veto multisigs have a 3/5 threshold, and upgrade multisigs a 4/5 threshold.
Misuse of Funds Funds deployed outside mandate Quarterly public reports; cap of max 20% for high-risk investments. DAO retains the voting rights to adjust the strategy.
Security Breach Smart‑contract or wallet exploit Multisig managed by Security Counsel ⅗.
Regulatory Uncertainty Changing token or foundation regulations Legal counsel retained; periodic compliance reviews; diversify treasury across compliant venues
Strategic Drift Foundation actions diverge from DAO vision Annual KPI reset via DAO vote
Reputational Risk Perceived opacity hurts community trust AMA sessions; monthly town‑halls

Commitment to Transparency

Transparency is at the core of this transition. The RARI Foundation will publish quarterly KPI reports —all made publicly accessible on‑chain and in the Rarible governance forum. Additionally, the Foundation will host open Q&A sessions after each report. These measures ensure the community can validate every decision, hold the Foundation accountable, and participate in strategy adjustments whenever needed.

Next Steps

Upon approval, the transition will follow these milestones:

1.Mainnet Treasury funds moved from DAO to Foundation multi‑sig & Audit completed.

  1. Treasury resource allocation strategy published (initial vendor/partner onboarding (e.g., custodians, ecosystem partners, analytics tools)

  2. Regular quarterly reviews and performance reports shared openly with DAO.

By adopting this proposal, Rari DAO positions itself for strategic clarity, operational efficiency, and sustainable long-term success.

6 Likes
#2

I have very strong concerns that one of the “examples” provided was in fact a foundation essentially not doing their job for over 6 months, not fulfilling their roles voted on by the DAO members, cutting off communication and reporting ,canceling elections and forcing a shotgun election so they could essentially hand over the DAO treasury funds and ApeChain to Yuga Labs to control and bolster their gaming studio direction Yuga is focused on now. Where most of the Foundation team had promised jobs(some former Yuga employees). Essentially removing the community, oversight and while having the same team that failed the DAO, in leadership positions in ApeCo/Yuga.

Why not provide the foundation a quick action fund to address those rapid requests? Then refill as needed via request to the DAO for more funding?

When the DAO no longer has real control of its funds, it is no longer decentralized.

5 Likes
#3

Hi @Money
Thank you for raising this — it’s an important point. Treasury management always has to balance decentralization with efficiency. But we’ve also experienced firsthand how slow decision-making and layers of DAO politics can hold back execution. When markets move fast, or when opportunities to support the ecosystem appear, delays can mean missed impact.

The goal of this proposal is to address that without removing community oversight. The DAO will continue to guide strategy and hold the Foundation accountable, while the Foundation focuses on execution. To make sure that balance is clear, the structure includes:

  • DAO approval at key milestones, including annual strategy renewals
  • Regular transparency reporting
  • External audits and milestone reviews

The Foundation already has resources earmarked for specific programs, but those are siloed and not designed for active treasury management. This proposal creates a unified framework where resources can be deployed strategically and efficiently, rather than spread across separate buckets.

This hybrid approach preserves decentralization at the strategic level while giving the ecosystem the agility it needs to operate effectively and capture opportunities that would otherwise pass us by.

6 Likes
#4

Hi @Anria , thank you so much for this proposal. We (collectively) need to get serious about our Treasury Management strategy and execution if the DAO, Foundation and ecosystem wants a thriving treasury for a long-term runway and responsible management.

As you noted, the reasoning why to propose this hybrid approach and opportunity reactive strategy, is the right forward progression from past attempts. As a whole, I support this proposal in it’s purpose, reasoning and execution.

I do have some questions to better understand some of the nuances in the proposal, which I’ve included below, however, I have one housekeeping edit for this proposal: Move/update the category to “Parent DAO proposals” just to keep the consistency and accessibility to finding it easier on the Forum. I also noticed this similar issue with your RRC-XX: Set Rarible ExchangeV2 Protocol Fee proposal.

Questions:

  • Regarding the cap of max 20% for high-risk investments, the definition of “high-risk” is not provided. Is it defined by volatility, lack of audit, newness of a protocol, or another metric?

  • The proposal states that the Foundation will be onboarding custodians, ecosystem partners, and analytics tools, etc, what is the process for selecting these partners? Will the DAO have any input on the selection? For example, will a list of potential partners be shared before the Foundation makes a final decision?

  • The 5% annual yield on strategic investments as a KPI. Is this a net or gross yield? Is this target yield based on a specific strategy (e.g., staking, lending, or real-world assets)?

  • What does the DAO veto power look like in practice for adjusting the strategy mid-cycle, or challenging a specific investment or a series of actions taken by the Foundation? Is there a formal process for the DAO to proactively challenge a specific investment or a series of actions taken by the Foundation, or is it primarily a reactive on-chain vote on strategy + funding release at the end of the year?

  • Is there a contingency plan for a no vote, as you mention a positive DAO vote but the proposal does not but does not address what happens if the DAO votes to reject the plan at the M4 Annual Audit. What is the contingency plan for this scenario? Would the treasury be returned to full DAO control, and would a new proposal be required?

5 Likes
#5

Thanks for the proposal @Anria, I am happy to support the RARI Foundation in being more proactive and agile at treasury management.

That said, I’d like to see a clearly defined treasury management strategy shared with the community before I can vote in support. Happy to discuss this further in a dedicated treasury management call. Specifically, it would be helpful if the Foundation outlined:

  • Primary goals of treasury management (e.g., capital preservation, liquidity for operations, diversification). Clarify whether the goal is to optimize the treasury for sustainability, protocol growth, return generation, or a mix of all the above.
  • Asset Allocation & Diversification - How assets will be allocated across stablecoins, ETH, RARI, or other tokens. Including guardrails to prevent overexposure to volatile assets.
  • Protocols & Platforms for Treasury Management - Which protocols, vaults, or platforms will be used (e.g., Aave, Morpho, Enzyme, MYSO or others). Criteria for selecting them (security track record, audits, decentralization, liquidity). How risk will be managed when deploying into DeFi protocols.
  • Who is responsible for execution (foundation team, external managers, service providers)
5 Likes
#6

This proposal seems like a total block box to me, I have quite some concerns with that.

The somewhat positive:

  • Treasury management and revenue strategy are absolutely needed. RARI DAO’s treasury once exceeded $200M (at RARI peak), but now sits below $10M. At current burn, the DAO might not last even ~3 years.
  • The Foundation acknowledges this challenge and is actively seeking solutions.

The Ugly:

  • DAO principle violation: Handing over full control of treasury assets to a centralized entity is unacceptable. It undermines decentralization and creates delegate liability risks. Reporting duties do not solve this. I very much agree with @Money on this

  • Framing: The DAO is characterized as slow and inefficient. Other DAOs have implemented strong treasury strategies without ceding control.

  • Examples: The cited cases are misleading. Arbitrum has a 1,7 bio heavy treasury, 11 mio are irrelevant to them. Apecoin SHUT DOWN the DAO with the proposal that is mentioned as a positive “decentralized” example here. I have no words for that.

  • Transparency gaps: The proposal lacks essential details, echoing @coffee-crusher and @jarisjames here. The absence of this information is a bit concerning.

    • Which providers would be used?
    • What strategies are planned?
    • Will RARI be sold?
    • Can the DAO still use funds?

  • Expertise: As far as I know, the Foundation currently has no dedicated treasury manager. Past reporting was low-quality or absent. I don’t see demonstrated capacity to manage the treasury alone.

Improvement ideas:

  • Managing just a share of the treasury, e.g. I very much like @Money’s idea on a quick action fund. We do have the treasury diversification funds lying around, already.
  • Providel transparency on providers, strategies, and decision-making process.
  • Establish a Treasury Council to oversee strategy and execution, ensuring accountability.
6 Likes
#7

Hey @bitblondy, I haven’t commented on this proposal yet, so I think you may have meant to tag someone else there.

1 Like
#8

Ah sorry, was referring to @Sixty (-:

2 Likes
#9

From my point of view, ceding control of funds to the Foundation carries clear risks around centralization and accountability… but at the same time, in markets like ours where volatility is constant → speed of action is critical, and DAOs have rarely been known for their speed.

What I’d like to understand better is: are there examples where DAOs have successfully managed treasury strategies without ceding control, and still been able to move quickly enough to capture opportunities? If those cases exist, they could offer a valuable model here.
maybe you know of a case to share here @bitblondy ?

The treasury management topic has come up here many times, and I’m on board with the idea.
My ask to @Anria and the Foundation is to shorten the reporting cycles and share strategies either beforehand or right after execution. That would give the DAO better visibility and stronger transparency.

3 Likes
#10

Hi @coffee-crusher
Thank you for your comments and support of the idea. Please find below the answers:

  1. Regarding the cap of max 20% for high-risk investments, the definition of “high-risk” is not provided. Is it defined by volatility, lack of audit, newness of a protocol, or another metric?

Answer: “High-risk” = categories with materially higher security, liquidity, or counterparty risk than our core sleeves. We’ll label which categories fall here in our reports; total exposure to this bucket stays within the 20% cap.

  1. The proposal states that the Foundation will be onboarding custodians, ecosystem partners, and analytics tools, etc, what is the process for selecting these partners? Will the DAO have any input on the selection? For example, will a list of potential partners be shared before the Foundation makes a final decision?

Answer: The Foundation’s obligation under this mandate is to act in the DAO’s best long-term interests—selecting partners that strengthen stability, security, liquidity, and sustainable growth. To protect negotiations and preserve leverage, we won’t publish pre-deal shortlists. Early disclosure can harm terms, breach NDAs, or jeopardize relationships.

  1. The 5% annual yield on strategic investments as a KPI. Is this a net or gross yield? Is this target yield based on a specific strategy (e.g., staking, lending, or real-world assets)?

Answer: The 5% is a net goal (after all costs), not a promise. Safety and liquidity come first. We plan to use low-risk, liquid approaches (cash-like instruments, conservative lending, plain staking) and won’t take extra risk. If markets are tough, we prioritize capital preservation and explain any shortfall in reports.

  1. What does the DAO veto power look like in practice for adjusting the strategy mid-cycle, or challenging a specific investment or a series of actions taken by the Foundation? Is there a formal process for the DAO to proactively challenge a specific investment or a series of actions taken by the Foundation, or is it primarily a reactive on-chain vote on strategy + funding release at the end of the year?

Answer: We report regularly; if the community has concerns, a proposal can escalate to on-chain for adjustments or pauses. The annual on-chain renewal vote is the binding checkpoint.

  1. Is there a contingency plan for a no vote, as you mention a positive DAO vote but the proposal does not but does not address what happens if the DAO votes to reject the plan at the M4 Annual Audit. What is the contingency plan for this scenario? Would the treasury be returned to full DAO control, and would a new proposal be required?

Answer: We’ll continue operating within the existing guardrails while engaging delegates and community to adjust the plan and reach consensus. If consensus isn’t achievable, the mandate—and the funds allocated to this program—will revert to the DAO for reallocation via a follow-up vote.

3 Likes
#11

Hi @Sixty

I really appreciate your feedback and support! Here are a few clarifications:

  1. Primary goals of treasury management (e.g., capital preservation, liquidity for operations, diversification). Clarify whether the goal is to optimize the treasury for sustainability, protocol growth, return generation, or a mix of all the above.

Answer: Grow and preserve capital to continue sustainably support foundation operations; support protocol health; generate moderate, risk-adjusted returns.

  1. Asset Allocation & Diversification - How assets will be allocated across stablecoins, ETH, RARI, or other tokens. Including guardrails to prevent overexposure to volatile assets.

Answer: Mix of runway (cash/stables), ETH exposure (unlevered), RARI strategic reserve, and a strategic sleeve—spread to avoid concentration or overexposure to volatility. Reviews and rebalancing happen via our regular reporting.

  1. Protocols & Platforms for Treasury Management - Which protocols, vaults, or platforms will be used (e.g., Aave, Morpho, Enzyme, MYSO or others). Criteria for selecting them (security track record, audits, decentralization, liquidity). How risk will be managed when deploying into DeFi protocols.

Answer: Favor established, audited venues with strong security and liquidity; we’ll document criteria and choices in reports and adjust if risks change.

  1. Who is responsible for execution (foundation team, external managers, service providers)

Answer: The Foundation leads day-to-day execution and holds final sign-off. We will work with an institutional treasury management partner for implementation and monitoring, and engage specialized service providers (custody, compliance, analytics) where needed.

2 Likes
#12

Hi @Jaf

Thank you for your feedback and the support on this idea. Regarding the reporting, we understand the concerns around visibility and accountability. To address this, the Foundation will continue hosting the monthly governance call, where we provide detailed treasury updates and walk through recent actions. This ensures the DAO has full transparency into strategies and execution, while still giving us the ability to act quickly in volatile markets.

4 Likes
#13

As I read all of the comments from the delegates, I do understand the concerns.
However, in my view I believe it is time to end the v1 DAO and treasury and start building up our treasury again in v2. Funds in v1 treasury can be used to create better market conditions and to support the ecosystem. It’s better to send your money to work then to just let it sit somewhere. Things in a DAO go slow and we are definately missing out on opportunities.

I do have concerns about misuse of funds. That cap of 20%, would that be the total amount in the treasury right now? If so, I suggest to lower it to 5%-10% to minimize the risk, especially for high-risk investments.

Besides that I don’t have any objections.

4 Likes
#14

Thank you @Anria for the responses to my questions, and I also support the 20% cap for high-risk investments. A 20% cap is still a conservative risk appetite for our treasury and is a sensible approach.

I totally understand the reasoning regarding not publishing pre-deal shortlists/early disclosure - my question was more aligned with a request for real-time updates on finalized partnerships, if these occur between monthly governance calls. Your focus on security for the treasury and transparency is greatly appreciated.

#15

Gm, @bitblondy I support all your observations regarding the state of our current treasury and the centralization concerns, which are valid, and we need more details of how this will work long term, including will the overseeing of treasury management return at some point to the control of the DAO, which is the core responsibility of the delegates.

However, I’m not sure if we have enough experience in the DAO within the delegates to have deep knowledge of tokenomics to understand and oversee the strategy, other than identifying high level goals (ie. with a Treasury council). I do understand what you’re intent is, an oversight council (an Executive Oversight Council - EOC) for all working groups, which I do support, but I think the DAOs maturity is not there yet to have an oversight council - we’re still early days, but something that we definitely should consider in the future.

1 Like