# War Camp Treasury Management Strategy Proposal v0.1

Proposed by @ceresbzns

**Goals of treasury management:**
* Guarantee cash is available to compensate contributors in a timely manner
* Generate yield on capital in order to extend operating runway secured by CCO3
* Longer term, use yield on capital combined with protocol revgen to achieve operating cost breakeven (perpetual runway)

**First Principles:**
* Prioritize holding assets on Gnosis Chain and in Gnosis Chain protocols
* Direct control via minions
* Opportunity to improve liquidity on GC markets
* Opportunity for positive-sum collaborations wiht GC protocol community
* Exclusively hold high quality assets in well-managed protocols
* high liquidity
* low expected smart contract risk
* Make effective tradeoffs wrt:
* risk and yield
* administrative overhead (strategy complexity & position complexity)
* gas expense

**Proposed Process:**

* On a monthly basis, Alchemists Circle shall:
* transfer funds to ensure that required cash and near-cash tranches are fully funded
* assess yield opportunities
* execute changes to existing positions as needed
* make a report available to War Camp with positions, yields, and changes made (if any)

**Proposed Strategy:**

|Tranche|Purpose|Target Amount|Platforms (eg)|Positions (eg)|
|---|---|---|---|---|
|Cash| Bank for distribution|1.3*(projected monthly burn)|minion|xDAI|
|Near-Cash|Yield w/ low risk profile, fast to convert to cash|2*(monthly projected burn)|Agave, Swapr, Sushi, Hop, Curve|stable lending (eg. xDAI, USDC, RAI) and stable-stable LPs (eg. xDAI-USDC LP)|
|Moderate Volatility| Yield w/ mitigated exposure to market upside / downside risks| TBD| Swapr, Sushi, Symmetric | volatile-stable LP (eg xDAI-ETH LP, USDC-ETH LP, xDAI-GNO LP)|
|High Volatility|Yield w/ full exposure to market upside / downside risk|TBD| Lido, Rocket Pool, Agave, Sushi, Swapr, Symmetric, Hop |ETH, liquid staked ETH (RETH, STETH), GNO, GNO-ETH LP|
|Operator Assets| Capitalize Gnosis Chain validator subDAO to generate xDAI cash flow | TBD | Gnosis Beacon Chain | mGNO

* **NB:** Strategy assumes 500+ ETH over time from CCO3 and significant GNO from a Gnosis <> Uberhaus swap
* In this strategy, resources are allocated to tranches in priority order (`cash` being highest priority and `high volatility` being lowest priority).
* As `cash` is drained to pay for contribution, assets in lower priority tranches are liquidated to fill the higher priority tranches up to the target amount (which can expressed as an arbitrary value, .g., 100K xDAI, or as a proportion of available funds, e.g., % of total treasury measured in USD). Therefore, as time progresses, funds flow from the highest risk categories progressively down to the lower risk categories.
* By choosing what proportion of treasury funds we want to allocate to each tranche at the outset, we can effectively choose what degree of risk and volatility we're willing to take on in order to have the opportunity to extend our runway while still securing our near- and mid-term cash needs.

**Scenarios to model:**

War Camp inputs:
* Burn rate x1
* Burn rate x1.5
* Burn rate x2

Market inputs:
* Big down
* Down
* Crab
* Up
* Big up

Work in:
* GBC DCF model
* ETH2 DCF model

**Resources:**

* [Karpatkey GnosisDAO treasury management](https://forum.gnosis.io/t/gip-20-karpatkey-dao-treasury-management/2233)