@shadow would this be a total of 33% ETH including ETH required for the ETH-OHM pool ? Or would the ETH-OHM be additional to the 33%
My preference, for purely- meme-ological reasons, would be to have pure (w)ETH as 33% and then in addition to that whatever we need for the ETH-OHM pool.
Nice work policy team.
ETH has 18.5% weight in the global cryptomarket. With a Treasury allocation of 33%, OHM would attach 2x the market weight to ETH ? We will inherit value (+/-) and volatility of the underlying - where ETH can still exhibit 20-25% price swings in a single day. We are thus inheriting a daily (+/-) swing potential of ~8% to treasury value. At what point does OHM become its underlying? What value and volatility characteristics do we strive for OHM to display? Comes back to the old question of the currency index I suppose.
Because OHM is grounded with stables, we are not cyclical. I can use OHM to diversify my risk away from the overall cryptomarket. I could not care less if ETH tanks. We have been called counter-cyclical, but perhaps better called non-cyclical. The more we load up with ETH and similar, the more cyclical we become as our correlation with overall crypto market increases. Does this not dilute our unique value proposition? If I want ETH I rather buy ETH myself.
In a risk-on environment, its awesome to be far out on the risk-ladder, getting charged (power-up) from other risk assets in the treasury plus getting charged (power-up) from leveraged affiliates. In a risk-off environment, that debt comes due.
Its not explained in depth why we stop expanding our LUSD treasury. I can assume we do not want to be too dependent on an external single point of failure. But I thought we liked the underlying mechanics of LUSD. Then can we not do something to address that risk instead? Maybe a merger, or an acquisition? Expand their lending features to include other assets than just USD. The valuation determination of an alternative LUSD we could give birth to (call it Drachma) could be rooted in whatever asset basket we want (all basketed assets just need to be publicly priced). Do an authorized fork, and send Liquity some fees back or any other arrangement. Through liquidation mechanisms we should be able to align the value of Drachma to whatever we want. And our Treasury value would then follow that asset basket valuation. OHM is the reserve currency. Drachma is the backing.
** Just some thoughts on the topic that is too complex for me. Full faith in the gigabrains of the team.
the Policy team is working on a proposal to shift from minting solely against RFV, by also incorporating quality (i.e. censorship-resistant, decentralized) non-pegged assets in the calculations.
Looking forward to hearing more about this in future updates.
Because OHM is grounded with stables, we are not cyclical. I can use OHM to diversify my risk away from the overall cryptomarket. I could not care less if ETH tanks. We have been called counter-cyclical, but perhaps better called non-cyclical. The more we load up with ETH and similar, the more cyclical we become as our correlation with overall crypto market increases.
This is an immediate concern of mine as well and I'm interested to hear more about the strategy to expand the treasury with more volatile assets like BTC and ETH. Is the plan to diversify into enough non-correlated assets that large swings in the crypto market will have significantly less effect on treasury value? How does the treasury plan on backing OHM with crypto assets and protecting the price against crypto market fluctuations?
I think the 33% is a safe amount for using ETH. There’s still enough of a buffer with the 66% that price volatility wouldn’t phase me because we are still looking at the growth of Olympus overall with more HODLERS coming in everyday and ETH is looking good going into 2022.
I think this is important from a philosophical perspective as well as diversification. Price volatility, however, can be nasty and a prolonged bear market will certainly be interesting to experience. If we can zoom out, I still see no reason not to add and continue to add ETH if the market does consolidate for any prolonged period.
Also want to add for those who dislike volatility…of the 33% ETH being used for RFV maybe we only account 66%(or any comfortable margin) of its intrinsic value thereby stabilizing our position from the market.
While ETH seems like a good idea (as does wBTC), 33% is too much for my liking.
33 percent is to much, it leaves us open to the market cycle, its all fine when the price of ETH is increasing, but this will not always be the case, I think the model at the moment is good, moving away from stables opens us up to the pearl of the market cycles. If the value of eth drops 60-80 percent where would we be?
I also think 33% is too much. 18%-25% I think is a better range.
While I agree that ETH may be considered risk free, the treasure value is now measured pegged against the USD (which likely will enter hyper inflation) and this means that what the value the DAO broadcasts for the risk free treasury holdings would also take on more extreme volatility with this move.
(I'm for it. Just saying there may be some slight drawback to the optics.)
Since I'm relatively new to the DAO, do we also consider OHM part of the risk free treasury value? If not, I believe we should.
Massively in favour of this, 33% seems like the right value to me too, enough to give a strong solid base
I'm no good at math, but it hink a 33% allocation to any single coin is not the way to go. Why not 50% in several stables and the other 50% in proven alts like (w)eth and (w)btc etc? Eth moves not only of itself, but is also (still?) influenced by btc-movements. If btc moves up (or down) suddenly, eth usually takes a hit. Not sure you'd wanna expose the treasury to that kind of volatility. If there's an overexposure to one kind of stable coin, can't we just add different stables to mitigate that?
Just want to say that 33% of RFV is not 33% of treasury: 33% of RFV is only 7.8% of the treasury (currently).
(RFV is just a convenient target to use for policy as it goes up only in a fairly predictable way. I understand 33% seems big but as written in the proposal RFV is an extremely conservative metric)
Seems like an elegant solution to target 33% of RFV.
Don't really see why we'd be against this proposal. The increased ETH exposure will help in the coming months.
Hmm, tough call.
I think we should acquire more than stables to avoid government regulations hunting us in the future.
ETH is in a Bull run now so it makes sense but it won't make sense to a lot of new investors when it goes back to the Bear winter.
Anyone who has been longer on OHM know the fundamentals enough to stick around but the same doesn't go to new investors. As I am writing this, we stand around 51,000 unique wallets holding OHM and many of them come because of the promise of stable, increased rebases. That being said, we do need waaaaaaaay more wallets acquiring OHM. I don't care if they hold 0.0000000001 OHM but I think we should aim for 1,000,000 unique wallets by next year.
Personally speaking, I check the Backing of circulating OHM daily and I cringe whenever I see the RFV value dropping by $0.30 (That is what matters to me the most). I try to consider an ultra conservative stand but if we were allowed 7.8% of treasury to be exposed to the price of ETH then this daily fluctuations will be more than $0.30.
I like De-everything opinion. If we need to include it then let's account for only 66% of its' intrinsic value thus even if the price goes too low, we will be safe from daily fluctuations and not have new investors doubting us.
I think diversification is good but in my opinion, we should wait for few months.
We are way to hyped with the BTC/ETC bull run to be making rational decisions. I rather we do nothing till this passes and our treasury reaches 1 billion or more in stables coins.
Just my 2 cents! (or 0.02 $OHM)
The time has come. So early.
More ETH, more chains!
Too much allocation IMO.. I like ETH, but would prefer to have 33% BED Index or something (1/3 BTC, 1/3 ETH, 1/3 DPI (DeFi Index)). I think I have a little hesitation as we are currently at ATH as well. I'm a trader by day and always pump the breaks around ATH. Then again plenty of people want to buy ATH 
All for expanding to crypto assets instead of stables, but just not 33% to one asset. A lot of people seem to be building outside of ETH at this point until the gas stops being excessive..
11% ETH, 11% AVAX, 11% SOL or POLY? Honestly not a huge fan of SOL or POLY just getting the idea out there
