Discussion: SBR to buyout 15% of Cashio DAO

Hi all. JD here, I’m working on Cashio Protocol. Currently we are planning the creation a DAO in order to allow CASH holders to participate in the Saber Wars, and we would like to bootstrap the Cashio DAO gauges by selling 30% of the upcoming govToken in exchange for SBR and SUNNY to be locked for 5 years permanently for Cashio DAO gauge votes.

This discussion is to gauge the interest from SBR holders to participate in this buyout.

The Cashio DAO gauges are meant to serve as proxy votes on behalf of the locked veSBR and veSUNNY that Cashio generates in its treasury by issuing CASH. These gauges are meant to boost rewards in CASH-LP pools in order to incentivize people to mint more CASH and therefore grow the quantity of SBR/SUNNY generated in the treasury. See the following diagram to visualize the flywheel I’m describing:

I propose having the SBR/SUNNY DAOs each purchase 15% of the FDMC of Cashio govToken distributed over the course of 1 year to veSBR and veSUNNY holders.

For more info on Cashio that isn’t on the main website, check out the documentation I just published. Introduction - Cashio Docs

Benefits to veSBR/veSUNNY holders

  • Additional incentive to lock SBR and SUNNY.
  • Access to governance token with high circulating supply compared to FDMC.
    • Nearly 75% of tokens used for voting at launch are given to SBR and SUNNY
  • Allows SBR and SUNNY holders to vote on boost gauges through Cashio without needing to lock up additional capital in SBR/SUNNY.
  • Aligns Saber and Sunny communities with Cashio and its purpose of increasing adoption of CASH stablecoin, as Saber/Sunny communities must hold CASH to benefit from reward boosts (see diagram above).

Downsides

  • Depending on how high demand for CASH and voting on Cashio gauges grows, users may prefer to use their available liquidity to vote on Cashio gauges with less power instead of locking their SBR/SUNNY for 5 years and voting directly themselves.
    • May decrease the amount of SBR rewards locked, as some users may prefer to sell SBR for more CASH or Cashio govToken instead of veSBR.
    • Other solutions (like sunSBR and govToken being airdropped to veSBR holders) will likely make this a non-issue by providing additional incentives to lock SBR.
  • Cost of 20M SBR/SUNNY. Will be locked for 5 years permanently, so the cost is negligible.

Tentative Cashio govToken Distribution Details

  • Allocation

    • Early Adopter (3.5% of FDMC)
      • All goes to veCOW holders over the course of 1 year
      • Token distributed is CGT-SAVE-1YR, which is a token that converts to a 1yr-locked veCGT
    • Buyout (30% of FDMC)
      • Distributed over the course of 1 year:
        • 50% to veSBR
        • 50% to veSUNNY
      • Token distributed is CGT-SAVE-1YR, which is a token that converts to a 1yr-locked veCGT
    • Team (6.5% of FDMC)
    • 60% goes to the DAO to propose and vote on how to use. Potential uses include:
      • Burn.
      • Liquidity Mining rewards.
      • Future treasury allocations for partnerships/buyouts.
      • Emissions for special DAO projects
  • Buyout Details

    • Saber DAO will give 20M SBR to be locked for 5 years permanently, used to vote on Cashio gauges
      • $1M valuation
    • Sunny DAO will give 100M SUNNY to be locked for 5 years permanently, used to vote on Cashio gauges
      • $1M valuation

Next Steps

  1. Discussion created in SBR/SUNNY to determine sentiment.
  2. If feedback is good, the proposals get activated.
  3. Tokens distributed by Cash once the proposal(s) pass.
  4. Cashio DAO opens via Tribeca once the development team finalizes proxy gauges and token wrappers allowing Cashio treasury to stake SBR/SUNNY rewards.
  5. DAO can vote on the distribution of the remaining 60% supply of governance tokens.
6 Likes

I think this is a great idea, and super innovative. It rewards veSBR and veSUNNY holders, provides utility to the Saber Wars, and benefits all parties! Cool!

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Didn’t run the numbers yet, but good to see some movement on the Cashio DAO front

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I think this is a waste of SBR treasury. I’ve never really understood the utility of CASH or how it adds value to the ecosystem. I don’t actually think there is any censorship resistance value given that the underlying collateral can be frozen. If Cashio were actually able to contribute CASH or USDT-USDC to in exchange for discounted SBR (POL trade), I would support. But we’re talking about 15% of a new governance token for a purposeless protocol that doesn’t have any meaningful earnings or prospects. Ultimately we must ask, do we really want to subsidize CASH pools having the ability to buy more SBR emissions? Wouldn’t we rather that yield help adoption of better stable coins?

2 Likes

I’m a fan of this because Cashio is indirectly POL for Saber. It only stakes into Saber LPs and makes it really easy for other projects to “build” on the Saber ecosystem. This is in contrast to most other Solana stablecoins which do not stake directly into Saber (yet).

I as a veSBR holder will be much more incentivized to grow adoption of this stablecoin if I know the SBR dao is going to receive a lot of the benefits of its growth.

2 Likes

Also this seems pretty cheap

Cash tvl is $36M. If we are getting to buy 15% at $1M, that gives this a $6.6M valuation at $36M tvl, or about 0.16 mcap/tvl pre-token

Hi guys,

This is Thanh from Coin98.

As one of the ealier users/supporters of both Saber and Cashio. I do support this proposal as I believe more TVL Cashio has, the more liquidity for USDT-USDC pool on Saber which attract more volume and fees.

However, I think allocating 3.5% CGT for veCOW holders is a bit unfair for COW early adopters. Somewhere between 15-20% might be a better allocation given all the effort and trust that COW community supported the protocols to attract our 36m tvl nowadays.

Also, this allocation will affect on voting power in future so with 15% supply, Cashio will be owned 100% by SBR and Sunny and even the Cashio team can’t vote on things they want to build the protocols

5 Likes

Lets just be transparent about what is going on. To an outside observer, we have a “team” that has been MIA for a month and a half make a request for $2M from SBR and SUNNY and then an hour and a half later update their discord with an apology for being MIA and something of a roadmap. Sure, $6.6M val for something with $36M TVL could be decent. But not when the team is MIA, TVL has been stagnant since launch, and no one has explained what purpose CASH serves. CASH hasn’t been adopted by any major apps. Chest.Fi is the only one I know of, correct me if I’m wrong. I agree that seeing some activity is great but let’s make the 20M SBR contingent on adoption by a major lending protocol or seeing if CASH DAO can figure out a way to get CASH to trade 1:1 with USDC, USDT or UST. Or Ian just be transparent about what you know that we don’t and why you have faith.

2 Likes

Hello Cortina, thanks for the feedback. A good amount of your questions can be answered by reading the docs, but I will try to be as transparent as possible about where Cashio is coming from. The development team has not had any reason to be active in the discord for the past months, to be quite frank, because the protocol was doing its job and CASH holders continue to receive yield opportunities which are superior to the yield you can get from the collateral. Meanwhile, they have been silently adding LP pools throughout the past few months. It’s not as straightforward as a project where the team makes empty promises and disappears. The team has gone nowhere, but now we are happy to put more resources towards communicating clear guidelines on what to expect next. Would it have been better to be fully transparent in the development of these plans over the past few months? Yes, and that’s part of why we’re moving to a DAO owned model. DAOs are built on transparency, and luckily the team has also been playing a role in making the tools that will be used to ensure that the holders of the governance token can operate the DAO without a human having to manually handle voting on behalf of the DAO. Instead, humans play specific protocoled roles in ensuring that the DAO operates autonomously in achieving its single purpose: increasing adoption of CASH.

We also understand that it is difficult to understand the utility for a proposal like this without first understanding the utility of CASH.

CASH is not meant to be a censorship-resistant stable coin, nowhere in the documentation or website is this stated.

CASH is a protocol that generates revenue as people hold CASH and mint more CASH. Why? Because you pay $1 equivalent in USDT-USDC LP to mint CASH, and at every point in time after that CASH is minted until it is burned - the Cashio DAO treasury grows as it collects SBR swap fees, and SBR/SUNNY rewards from the LP tokens users deposit as collateral. This also means that every CASH token is guaranteed to be backed by a USDT-USDC LP token. The value in holding CASH and not USDT or USDC is not because you are looking for a censorship resistant token - but a token that is still able to hold a $1 peg (with ~1.5% tolerance) while also allowing the holder of this Solana based stable coin to benefit from boosted yields. Even without implementing the DAO gauges, you are currently able to get >10%, sometimes up to 30% APY from CASH LPs on Quarry. With the implementation of gauges, these numbers are likely to be much higher and more consistent. You are not able to get comparable yields by holding the underlying collateral alone.

The SBR/SUNNY rewards only have one purpose: to be perpetually max locked in the SBR and SUNNY DAOs. It is not going to a token holder with a short term time horizon, it is going to be used purely for long term governance. Why? Because this allows the Cashio DAO to always maximize the impact it can have on gauges, and this matters because the Cashio DAO will be the first DAO that has gauges which serve as proxy votes for the DAO itself voting in SBR/SUNNY. The SBR is not going to get dumped, it will literally only ever be locked in the DAO. This allows those who hold CASH to get higher rewards from their CASH LP staking. Similarly to how any other protocol would like to participate in the Saber Wars - they must acquire SBR, lock it, and vote on the gauges to increase the rewards on their arbitrary protocol pools.

This is special because instead of participating in Saber Wars as a traditional protocol with a traditional volatile token - you can participate with a Solana native stable coin that is not nearly as volatile (and currently trade-able 1:1 with other stables on jup.ag), and as more people adopt CASH, the more SBR/SUNNY it will generate to lock for 5 years, and the more influence it can have on SBR/SUNNY emissions going to CASH LP pools. The influence, though, is actually coming from CGT holders voting on the gauges and benefitting from the increased APY on their CASH-LPs in Quarry.

This is also why it’s important to make sure that CASH and SBR are aligned - because you as a participant in the Saber Wars now have another method of participating in the Saber Wars which doesn’t require you to lock up additional SBR. You can simply receive CGT from your already locked SBR, and then head over to Cashio DAO and vote on your favorite CASH pools so you can get boosted yields. These can be any other stable coin (USDC/USDT/UST/SolUST) you would traditionally hold, but by also having half of it be CASH you are able to instantly benefit from the boosted APYs (in the form of SBR and SUNNY).

What Chest.Fi is doing is great, but not necessarily related to this proposal. You can get single-sided staking APY from them, but many people currently use CASH to stake in LPs on Quarry instead. Even if this proposal didn’t pass, the Cashio DAO would operate in the same way - but passing this proposal increases the incentives for SBR and SUNNY holders to transfer some of their stables to CASH since they will see higher APYs coming from CASH LPs. Then (hopefully) more people mint CASH and the DAO can generate even more SBR and SUNNY at a higher rate to have more weight on future gauges. It will also be much easier to create incentives to build on top of Cashio once the DAO is able to do things like put out bounties, fund initiatives, etc. This is why 60% of the allocation is going to the DAO. Giving veSBR holders CASH or USDT-USDC LPs would just print CASH out of thin air (which would depeg or make it so CASH is no longer backed by collateral (which would also depeg). Also, veSBR holders will likely benefit more from the increased rewards over the long term provided by increased gauge weights, as opposed to a one time payment that would probably be very minor on an individual basis.

Let me know if this is helpful, and if you have any other questions or concerns and I will get back to you asap.

4 Likes

To follow up on @Cortina 's point, I don’t think it would necessarily hurt to include some set of contingencies here. But generally speaking, I would support this proposal.

My first impression of $CASH is that it looks and feels a lot like $MIM on Ethereum.

Also, not entirely sure if it’s a great 1-1 comparison, but Abracadabra reports ~ $2.85 billion TVL, which is just slightly higher than the reported market cap of $MIM.

As @igm pointed out, implied MCAP/TVL ratio could be quite attractive for an investment in a project that also offers to stake directly into Saber and lock the granted $SBR tokens for at minimum 5 years - to the benefit of the SaberDAO.

1 Like

Hey Thanh,

I can certainly see how 3.5% CGT for veCOW may seem like a small amount compared to the role COW holders held in attracting the current TVL. We ultimately left a large portion (60%) of the supply for use by the DAO, but your comment made me realize that ultimately SBR and SUNNY holders will have much more weight in choosing where the DAO-held CGT goes. It would make sense to reduce the DAO portion in order to benefit veCOW holders directly.

I think it may be wise to do some analysis on # holders between the three tokens (veSBR/veSUNNY/veCOW) to more accurately represent the likely distribution of CGT. Will get back to you on this point soon, thanks for bringing it up.

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Contingencies are not an issue, I’m curious to hear if you or anyone else on the thread has any specific ideas in mind on the risks that exist and contingencies that would limit these risks.

TBH, no I don’t.

I would likely support this proposal as is. Was simply saying that it wouldn’t hurt to have a conversation on it if others cannot get comfortable with the proposal.

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i support this proposal.

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From our tweet announcing COW DAO https://twitter.com/CashioApp/status/1462626841043222536?s=20&t=w8s2oq83KKyAE2JElOCgIg

Cashio ($CASH) :dollar:@CashioApp·Nov 21, 2021To celebrate early adopters of the Cashio Dollar, we’re introducing Cashio’s fair launch memecoin: Cash Cow :cow2: $COW!

Please note that Cash Cow ($COW) is NOT CONNECTED to our upcoming DAO governance token.

COW was set up with the purpose of bootstrapping liquidity by offering the emissions of the memecoin, COW, in CASH LPs. It’s DAO only operates to manage the gauges that determine the emissions of COW to various CASH LP pools.

This is different from the Cashio DAO, which doesn’t exist yet, but will allow users to vote on the pools which the Cashio TREASURY itself will vote on with its perpetually max locked veSBR/veSUNNY. COW was an experiment to bootstrap liquidity + community, taking inspiration from SAMO, WOOF, and other memecoins. That’s all it ever was, and that’s all it is. It allows you to vote on COW emissions, but it is not the DAO that governs over the protocol. Sorry if that message made it unclear, it will be fixed to match the messaging from the medium articles and tweets announcing COW.

FWIW this has led to a decline in the $COW price of 80-90%. Early adopter of the protocol are pretty rekt and now that the proposal is on the table, new entrants can get ve-COW for a significantly lower price.

Did you take snapshots of ve-holdings?

I’d suggest to drastically reduce the DAO allocation given the many challenges DeFi projects traditionally have with spending these funds effectively (eg as outlined by Hasu).

Generally, I agree with the points made by @imlethanh and welcome revisiting the allocation.

2 Likes

Cashio didn’t grow organically enough to generate enough money to actually COMPETE in the “Saber Wars,” so instead Saber is just going to mint and exchange SBR for govCASH.

The “Saber Wars” should be rebranded, because it doesn’t seem that there is any war going on for SBR. No competition on any level. Just the Saber “DAO” printing more SBR and exchanging it for their preferred protocols’ gov tokens, driving absolutely no demand for SBR.

Saber insiders already have outsized influence over the “DAO.” If they wanted to incentivize CASH pools more they could. Printing more SBR in exchange for influence where that SBR directs its votes is pointless.

2 Likes

Thanks @jdx for the thoughtful response. What you wrote might be good to pin in the cashio discord or in the eventual cashio channel within the SBR discord if it goes that way. Or turn it into a medium post/tweet thread.

“CASH is not meant to be a censorship-resistant stable coin, nowhere in the documentation or website is this stated.” I would delete this part. I don’t want to get in a debate about decentralized (which Cashio does celebrate) vs. censorship resistant because that’s not really the point but I’m sure you can see how this is a bit disingenuous.

I have read the docs (which aren’t exactly easy to find) prior to making my comments so let’s just assume I see the value of a yield bearing stable coin built on top of the pristine collateral of USDC-USDT. But the mechanics aren’t quite right yet.

Here are some things I’d like to see:

  1. It seems like CASH has lately and may always trade at a 1ish percent discount to other stable coins given current mechanics. This could be solved by either CASHIO removing the withdrawal fee or SBR removing the USDT-USDC withdrawal fee or both. Ultimately, an arbitrageur should be able to mint/burn CASH profitably when de-pegged.

  2. OR letting some value that is currently captured by CASHIO DAO accrue to the CASH holder over time. It’s not really a yield bearing stable if the value is not accruing to the stable coin holder (either through fees/rewards gained on redemption or DAO tokens representing those fees/rewards earned. How do you see this playing out med/long term? I know this is a challenging engineering problem.

  3. Why does PORT finance allow USDT-USDC collateral but not CASH? Seems like some biz dev work could be done with all of the major lending protocols.

I can get on board with this deal and understand that it can be good for SBR. But I think it is reasonable to ask for some “proof of seriousness” before investing 20M SBR. What vision are we investing in? Is CASH going to serve a purpose outside of SBR/SUNNY LP farming? If the value is that CASH can earn higher yield than USDT-USDC because we can create new pools and get more SBR/SUNNY rewards then whatever, enjoy the circle jerk, but not really something SBR should be supporting.

I think @DedmundFitzgerald first sentence above has some truth to it. The rest was pointlessly negative and not very helpful.

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Yes, the whole $COW thing was pretty bad. Nice little boost that some of us could farm for awhile but fundamentally a “lets take advantage of idiots” strategy. Maybe harmless, may create some headaches moving forward.

I think DAO allocation needs to be large. It needs to be used as a CASH adoption incentive over time. Both for users but also other DOA’s like lending protocols to adopt CASH. Look at what LIDO is doing for a roadmap. [reWARDS] March 22' Budget - Proposals - Lido Governance

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Yes, the whole $COW thing was pretty bad. Nice little boost that some of us could farm for awhile but fundamentally a “lets take advantage of idiots” strategy. Maybe harmless, may create some headaches moving forward.

COW DAO was the first Tribeca DAO & established as “the Kusama of ShipCapital”. The lack of communication or progress (be that on the product or governance side, eg. queued but not executed proposals) is far from harmless.

I’d argue that both teams have lost a lot most of the trust with ecosystem participants. It serves as a warning to all early adopter that ultimately the team dngaf about retail. This sentiment seems reflected in the comment from @DedmundFitzgerald (a saber og).


I think DAO allocation needs to be large. It needs to be used as a CASH adoption incentive over time. Both for users but also other DOA’s like lending protocols to adopt CASH. Look at what LIDO is doing for a roadmap.

Have a look at the $LDO price chart. I don’t think their “spray & pray” approach should serve as a role model.

Starting with CASHIO the missions statement –

The Cashio Treasury is tasked with strategically incentivizing widespread adoption of $CASH.

IMO the main avenue for CASHIO DAO to incentivise adoption of $CASH should be veSBR, veSUNNY & veCOW(?), not CGT.

There are some particularly interesting innovative examples in the docs, but from my perspective, none of these novel approaches would warrant a large DAO allocation. As we have seen with the likes of MNGO, a large treasury allocation quickly becomes a liability as market participants fear dilution (even if irrationally), and the DAO decides to burn the allocation. (Which is ironically the first bullet point in the proposal from @jdx). By reducing the allocation in the first place, a lot of headaches can be avoided.