DAO Funding & Treasury


This proposal is meant to revive the idea of terminal inflation for FLX as well as ensure that the DAO has a properly sized treasury for the next few years.

The discussion about terminal inflation started a long time ago in this forum post.

Current Setup

Currently, there’s 131,000 FLX left which can be used for DAO expenses and RAI incentives. At the same time, the current incentive schedule is set to give out 340 FLX per day, split between FLX/ETH stakers and various RAI integrations. This results in 124,000 FLX being given out per year to incentives.

Moreover, two community members posted their DAO candidacy proposals (here and here) on the forum with associated compensation packages. Besides the integrations and the DAO lead positions, the DAO may wish to onboard members to cover community management and infrastructure maintenance (auction bots, subgraph etc).

Proposed Setup

The proposed changes (which are meant to be applied before ungovernance phase 2) are meant to achieve the following:

  • Prepare the DAO to have at least 3 years of runaway for a small, nimble group of up to 5 main contributors (DAO lead, integrations, comms management, protocol maintenance)
  • Have at least 2 years of runaway for RAI incentives
  • Have optionality through an immutable smart contract to turn FLX terminal inflation on and off

The changes are as follows:

  • Reduce FLX emissions from 340 FLX per day to 300 FLX per day starting in mid June 2022. Nominating @0x-kingfish to propose a plan on how this can be implemented
  • Mint 169,000 FLX using an immutable smart contract so that the DAO has 300,000 FLX in its treasury
    • This would result in about 987.5K total FLX supply assuming nothing else changes until this initial mint happens and the FLX supply remains 818,335 FLX
    • At 300 FLX per day in emissions, the treasury would have enough runaway for 2 more years of RAI protocol incentives and 81,000 FLX reserved for DAO related expenses
  • Using the same immutable contract mentioned above, give the DAO the option to turn FLX inflation on and off up to a certain limit
    • The DAO could start switching terminal inflation on and off on 1st of January 2023
    • The starting inflation is 0%
    • The max possible yearly inflation would be set in stone at 5%
    • The DAO has the option to completely terminate inflation and revoke its access to the minter contract


In a week from now we can get a general temperature check through a poll to see what the community thinks about this proposal.