Blockchain News

dYdX Foundation Secures $30 Million From Community Treasury in Landmark DAO Vote

The funding, equivalent to around 4% of the remaining DYDX tokens, will be utilized to recruit and retain talent while scaling the dYdX chain. 

The dYdX Foundation, a non-profit organization backing the dYdX protocol, has successfully secured $30 million in DYDX tokens from the dYdX community treasury. 

This recent fundraising of $30 million is equivalent to approximately 4% of the 253 million tokens retained in the dYdX community treasury. The foundation aims to utilize these funds for talent acquisition, retention, and the expansion of the dYdX chain.

It is worth noting that the proposal to secure $30 million in funding was approved with a 98% approval rate.

As a Swiss entity, the dYdX Foundation plays a vital role in supporting the growth of the dYdX protocol ecosystem. Its responsibilities include engaging with the community, supporting developers, and maintaining a decentralized governance structure.

Strategic Vision

David Gogel, Vice President of Strategy and Operations at the dYdX Foundation, highlighted the strategic importance of this community-driven fundraise in an interview with Blockworks.

After two and a half years of operation, the foundation found itself with a limited runway. The goal behind the fundraise was to secure additional funding, extend the runway, and facilitate continuous support for the dYdX protocol.

Allocation and Strategy

The foundation plans to allocate a significant portion of the funds to employee-related expenses, including salaries, bonuses, and benefits. It anticipates hiring four new employees over the next year to bolster its growth initiatives.

Other budgetary allocations include marketing, business development, legal, and accounting expenses, underlining the foundation's commitment to responsible financial management. Notably, the proposal drew overwhelming support from 98% of voters among DYDX governance token holders.

Future Initiatives

Looking ahead, the dYdX Foundation aims to diversify a portion of the acquired funds into fiat and stablecoins. Additionally, it plans to invest in expanding its staking operations, leveraging the current yield on 2.5 million DYDX tokens. With the approved budget, the foundation extends its operational runway beyond 18 months, ensuring sustained contributions to the growth of the decentralized finance (DeFi) ecosystem.

“Ultimately, with these three years of runway, we want to continue to hire and retain the best team, give our team visibility and some level of job security,” Gogel said. “Our goal is to get 18 months of runway in cash to be able to cover our fiat operating expenses.” 

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