SDIP#12: DAO Expenses for March 2022

With Stake DAO growing on all fronts — TVL, number of verticals, contributor head count—operational costs are steadily increasing. This is a good problem to have, as a barometer of our success, but it means we will need to stay organized, strategic, and transparent in our spending.

This proposal outlines in detail the costs incurred by the DAO in March, 2022, and seeks approval. Going forward, we will publish these expense reports on a regular basis as we push to develop best-in-class operational practices.

Summary:
Send funds from the Treasury Multisig to the Operational Multisig and Polygon Multisig to pay for the DAO expenses for March : Infrastructure, Legal & Tax, Events, Admin & Tooling, Marketing and Contributor rewards.

Rationale:
The goal of this proposal is to bring more transparency to the Stake DAO Treasury. A governance framework is already in work (and should be ready next month), which should facilitate better visibility of the governance, and present a monthly budget for the DAO costs. This proposal seeks approval for the DAO expenses for March 2022.

image

Mainnet expenses:

IT & Tech Infrastructure:
All IT & Tech infrastructure will be provided as a service by an external partner focused on Administration and maintaining. The initial budget for this expense was 45,000 USDC/quarter, however the cost increased a lot and the servers costs are expected to increase over the next months, because of a higher validators amount to bootstrap our Staking-as-a-Service Offering and our Arbitrage Strategies on Avalanche.

  • AWS, Vercel, Github, and other tools and services needed by the DAO.
  • Servers infrastructure: 60,000 USDC
  • Admin & Tooling: 7,900 + 5,800 USDC
    Total monthly costs: 73,700 USDC

Legal & Tax:
As regulation and AML rules are getting tighter, the DAO must have a solid legal base on which operations take part. The DAO will continue to mandate an experienced advisory already working with major projects on the blockchain. The initial budget for this cost was 20,000 USDC/quarter.

  • Effective Cost for the Legal & Tax expense: 5,500 USDC
  • Extra budget in case of additional costs: 1,200 USDC
    Total monthly cost: 6,700 USDC

Marketing & Events:
As the DAO competes against other significant players, marketing actions like events are needed to raise awareness of DAO and improve our market presence. The initial budget for events was 20,000 USDC/quarter, depending on the amount of events and the marketing one was 60,000 USDC/quarter.

  • Effective cost for March events: 47,000 USDC
  • Extra budget in case of additional cost: 3,000 USDC
  • Marketing costs: 20,000 USDC

Total monthly cost: 70,000 USDC

Audits:
The audit costs are estimated to 60,000 USDC/quarter, however the cost can change depending on the complexity:

  • Effective Audits costs to pay for Q1 2022: 56,250 USDC
  • Audit already paid for Q1 2022: 45,000 USDC
  • Left to pay: 11,250 USDC

Polygon expenses:

Contributors sdam3CRV rewards:
The contributors rewards are estimated to 64,250 sdam3CRV/month for their work:

  • Effective contributors rewards for March 2022: 51,400 sdam3CRV (Already paid from treasury Msig)
  • Extra budget in case of new hires (up to + 25%): .12,850 sdam3CRV
    Total monthly cost : 64,250 sdam3CRV.

Voting options:

  • Yes, accept the DAO expenses
  • No, refuse the DAO expenses
  • Abstain
Should we implement SDIP#12 ?
  • Yes, accept the DAO expenses
  • No, refuse the DAO expenses
  • Abstain

0 voters

3 Likes

appreciate the transparency of ops costs here; also good to see we’re investing in audits and a good legal base

1 Like

I also deeply appreciate the effort of transparency but it got me a bit more curious…

IT
Boostrap SaaS and arb Strats = I see this as investments and not expenses (required for generating future revenues for the DAO)

Legal
Would be interesting to have more info on the legal base of the DAO.
Where s it incorporated and who are the shareholders? Clarify relationships between Stake Capital and Stake DAO
What specific tax are you referring to?

Marketing
What kind of marketing operations were deployed for 20K/quarter in the last months? Is this in addition of the quiz rewards?

3 Likes

Appreciate and approve the expenses.
How could we mitigate the usdc60k of aws / month?

1 Like

Hey @dwidoo thanks for your feedback and questions:

About the legal part, Stake DAO and Stake Capital are two different entities with different missions/products: Stake DAO is a protocol DeFi and Stake Capital is a hedge fund.

About the marketing part , in addition to the quizz rewards, Stake DAO sponsored several events.

1 Like

Hey @staker; thanks for your feedback !
Not sure if we can, the cost is growing because the amount of validators is growing too.

2 Likes

Interesting SIP
Could we think to include compensation for Cosmos StakeDAO validator slashing victims. StakeDAO Cosmos depositors were slashed and no info about compensation. This case in shadow but victims are still keep hope.

Have to say it’s really amazing to see this level of transparency, congratulations Dydy!
It’s also a great step towards cost rationalisation in the future.

1 Like

This is a good point

The SDIP#12 vote is over: Snapshot