Guide to DAOs

Market Meditations | July 1, 2022

?‍♀️ It’s Going DAOn For Real

In part 1 of this series we outlined exactly what a DAO is, and how anyone can find top DAOs to get involved. In part 2, we will demonstrate how to dive deeper into DAO treasuries in order to vet potential opportunities.

DAO Treasuries

DAOs are a fantastic way to get involved in the space, whether to network, learn more about your favourite protocol, or simply to find opportunities for profit. Understanding what assets a DAO owns can be essential in deciding which projects you want to contribute to. Using Nansen we can see:

  • The dollar value of their liquid assets: Will the DAO be able to achieve its goal with the amount of resources they have?
  • Portfolio allocation: Do they hold volatile assets that may decrease in value or do they hold stable assets such as USDC?
  • Token holdings: Who are the key stakeholders? Does the DAO have faith in other projects?

Last week we identified the largest DAO by liquid assets – BitDAO. Let’s dive into their holdings: 29/06/2022 – BitDAO – DAO God Mode – DAO ETH and Token Balances

  • BitDAO has liquid assets worth a total of $2.6bn, showing they have resources to enact significant change in the crypto industry.
  • 72% of the USD value within these assets is generated from their own token BIT. This is common for DAOs, but does demonstrate the potential volatility within their treasury.
  • They hold an $85m position in FTX’s native token (FTT). We can see from the proposal on BitDAO exactly why this is the case.

✅ Tip: Nansen also shows the wallet addresses that hold the these assets. This allows us to dive even further, looking at specific transactions or any holdings placed in other locations.

DAOs propose a new type of governance structure that has the potential to solve key issues within today’s organisations, including a lack of transparency and hierarchical models. There are a variety of DAO structures, each with different degrees of potential for their members.

Using Nansen, we are able to identify top DAOs, understand who controls them, and see a breakdown of their liquid assets. This allows us to decide exactly which DAO we want to spend our time contributing to.