Very interesting proposal - thank you for the great work here! I am in favor of Index Coop setting up a mechanism to take advantage of significant mispricing opportunities (like the one we find ourselves in today). Acquiring undervalued INDEX using the treasury is a value accretive and synergistic operation for the community. Some of the best CEOs of all time derived a lot of their success from being shrewd capital allocators that could swoop in at market lows to buy up their equity and deliver superior returns (best case study: John Malone and TCI).
A couple of thoughts that came to mind the first time I read this:
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We could also think of using the acquired INDEX for core contributor compensation. Something a lot of public companies do is use their treasury stock (bought back shares) to finance stock-based compensation. Thus, the Index Coop community wins from both a price increase since the purchase as well as from a way to finance compensation (paid to naturally long-term holders) without having to increase the outstanding supply as much
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I would like to caution the ‘selling’ component of this strategy. Opportunistic buys are great, but the sale part can get a bit tricky. Firstly, how do we know the asset is priced fairly? This could be a contentious debate in the community and opening this up could reveal where the team thinks the asset should be priced at, which leads to the problem discussed next. Secondly, selling would theoretically signal what the community thinks is fair value. This could dampen overall price discovery, which could have led to prices even greater than what is interpreted as fair value. Adding more color or perhaps certain re-engineering of the ‘disposal’ piece could use some more discussion (i.e. paying contributors is another way of looking at disposal)
Overall, I am for starting this program given the great purchasing opportunity that lays before us right now; however, I would appreciate further discussion of what to do with the actual INDEX tokens at a later time. Thank you again!