BendDAO proposes to establish a treasury investment fund of 80 million USD

BendDAO is seeking community approval to sell 1 billion tokens, thereby forming a subsidiary treasury for the organization.

On the afternoon of September 19, NFT lending platform BendDAO submitted a proposal to create a $80 million non-operating asset investment fund.

The move is part of an effort to diversify the DAO treasury. If approved by the community, the fund will act as a sub-treasury of the organization and deduct at least 50% of the investment amount into non-operating assets, i.e. assets that are not engaged in production/ business of the enterprise. 

Accordingly, BendDAO proposes to sell 1 billion tokens, accounting for 10% of the total BEND supply. Lending platform NFT plans to use Ethereum (ETH) as the funding currency, with a minimum investment of 100 ETH per share to achieve an after-money valuation of $80 million for the fund.

Of the 1 billion tokens, 60% are allocated to venture capitalists. The rest is divided equally among investors from DAO and blue-chip NFT projects. Each VC, NFT or individual investor is only allowed to own a maximum of 2% of the tokens being sold by the fund.

Currently, BendDAO is considering two token distribution options for investors:

1/ No vesting is required but the DAO will deposit an equivalent amount of ETH generated from the token sale into its ETH liquidity pool for profitable staking.

2/ Requires vesting for 6 months and gradually unlocks within 2.5 years.

BendDAO intends to use a minimum of 50% of the funds to invest in non-operating assets. The DAO will create a 4/7 multi-sig wallet for the secondary treasury, consisting of 3 community members, 2 VC representatives, 1 person from the blue-chip project, and 1 key member of BendDAO.

For BendDAO, the sub-treasury is imperative given the recent difficulties the project is facing amid the downturn in the overall NFT market. Some borrowers have fallen into default due to the sudden increase in loan interest rates, weak liquidity and the NFT floor price also continuously bottoming. Since then, it has raised many concerns about the risk of mass liquidation on BendDAO, as discussed by FoxCryptoNews in the previous article. But recently, the project opened a vote to change the liquidation index to get rid of the liquidity ghost on August 22. 

FoxCryptoNews summary

Sep 20, 2022