@Dydymoon Hey! Thanks for your feedback. Please find the answers below.
Price impact of selling Aave’s BAL holdings OTM at the moment of writing is indeed 3.28%. But having a strategic partner of Balancer selling all its BAL position sends a signal to the market that could keep on hurting BAL price.
Correct, we meant it would hurt Aave ecosystem, it was a “misclick”. ;)
You’re right. Technically speaking—you’d still be diversifying the treasury—although not into a sufficiently liquid asset (Coingecko’s 24 Hour Trading Volume: $268,782), which defeats the risk management purpose.
Both using GHO or other stables in the treasury sounds reasonable for us, we’re just raising a new option for community discussion.
The token swap is indeed different to the one mentioned, and as we specified, it would require Aave to convert its BPT into auraBAL, so it’s not compatible with Option 1.
We’re questioning that goal, as it was defined by assuming that the DAO would be dumping its entire BPT holdings. We’re proposing a scenario that maximises the outcome for every stakeholder.
As mentioned above, GnosisDAO’s treasury has $3.6M of exposure to auraBAL, so we reckon that auraBAL has no voting power. If Aave DAO were to stake, it would receive a 35% APY (8% in AURA and the rest in auraBAL). This could be locked to increase voting power (in the case of AURA) and used to bribe to increase emissions, sold for AURA, or consider other strategies.
The proposal to create a Liquidity Committee—which in our opinion should extend its mandate beyond GHO e.g. AAVE—is an acknowledgement that this subject’s strategic nature and scale are worth dedicated resources that should manage the added complexity.
This is Vs baseline scenario, not Vs Option 1.
We’re happy to contribute! This is indeed a separate OTC deal to the one presented above—we’ll work on the proposal and post it on the forum to seek community alignment.