dYdX Foundation Seeks $30M Budget, Promises Yearly Spending Report

• dYdX Foundation Requests $30 Million from DAO for Three-Year Budget
• About dYdX Foundation
• Details of the Budget Request
• Initial Response
• Budget Allocation
• Foundation's Financial Management Strategy
• Utilization of Acquired Funds
• Future Budget Requests and Reports

dYdX Foundation Requests $30 Million from DAO for Three-Year Budget

The dYdX$3.13 -1.20% Foundation, a supportive entity of the decentralized crypto exchange dYdX, has proposed a financial plan necessitating $30 million from its governing decentralized autonomous organization (DAO). The funds are anticipated to be expended over the forthcoming three years.

About dYdX Foundation

Details of the Budget Request

The proposed fund requirement, though substantial, would allocate to the Foundation 4% of the DAO's present treasury if approved by dYdX tokenholders, who serve as the voters within the DAO. The three-year duration would exempt the dYdX Foundation from submitting annual budgets for examination and endorsement, a typical procedure for other DAOs and their corresponding foundations.

Initial Response

The budget proposal received substantial concurrence from various dYdX stakeholders, including validators and delegates, upon its initial announcement last Friday. The next step involves a voting procedure that will continue until February 2.

Budget Allocation

Almost 50% of proposed funds would cater for payroll, with 18% dedicated to marketing and growth, 14% towards legal disbursements, and 5.5% to contractors, among other allocations.

Foundation's Financial Management Strategy

The Foundation expressed a commitment to prudent financial management, employing capital preservation strategies for risk mitigation. After a banking crisis in March led to stablecoin de-pegging, the Foundation transitioned away from USDC and into treasury bonds, thus minimizing risk and tripling yields, although this might be perceived as a step away from crypto.

Utilization of Acquired Funds

The Foundation intends to diversify a portion of the new funds into fiat and stablecoins and invest in augmenting its staking operation, through which it currently receives staking yield on 2.5 million dYdX tokens. The requested $30 million would encompass 10.5 million DYDX tokens and would extend the Foundation's operational runway past 18 months.

Future Budget Requests and Reports

The subsequent budget proposal from the Foundation is anticipated when we approach 18 months of runway, most likely in the middle or end of 2026 as per current estimates. Instead of annual budget voting, the Foundation intends to issue an annual report and a semi-annual report detailing fund utilization.

Edited by Jonathan Stoker