Pulling Funds for Initial Exchange Budget

Growth Business Development
1

Context

There seems to be near universal alignment amongst the Index Coop that exchange listings are crucial to driving DPI growth. Exchange listings drive AUM in and of themselves, and they also make it easier for people to purchase DPI, thereby increasing AUM in the long run. For example, Binance has 15M users. If .1% of those bought DPI, the numbernumber of DPI token holders would increase by 200%.

However, exchange listings have costs associated with them, including but not limited to:

  • Legal fees for non-security letters (ranges from ~$5K for Singapore to ~$80K for US)
  • Payments to market makers to provide liquidity for DPI (~$10-$20K per month)
  • Listing fees (~$20K-$400K)
  • Marketing budgets for marketing promotions associated with a listing (~$5K-$10K)

We are in conversations with a number of exchanges but we need to move fairly quickly to get things done. The process can be cumbersome and involves coordinating between market makers, exchanges, and lawyers. Some of the costs associated with these things can be sensitive and are not ideal to put to a community vote.

Proposal

We should seed a budget that will be used to fund exchange listings. We’ll run a strategy of initially focusing on non-US exchanges that have fiat onramps and large user bases. We can get listings done here more quickly and slowly build up momentum to drive listings on major US exchanges. We should be able to get a number of exchanges that fit this bill live for $10-$25K per exchange. We should pull funds from the treasury upfront so that we can move quickly and don’t have to put every expense to a community vote.

Examples of initial expenditures:

  • Bitmart has offered us a free listing but it requires a non-security letter and a small marketing spend
    • $8,000 for a Singapore non-security letter
    • $5,000 for marketing promotions
  • We are in conversations with Bittrex Global but this requires a Lichtenstein non-security letter
    • $10,000 for a Lichtenstein non-security letter
  • Both of these exchanges may ask us to bring our own market maker to provide liquidity for DPI
    • $10,000 per month for market making services

Details

  • $100,000 in INDEX deposited to a three-of-three multi-sig managed by Regan, BigSky, and a member of the treasury committee (DarkForestCapital)
  • 100% of funds go towards exchange listings (0 to contributor rewards)
  • Regan will clear all expenses with the treasury committee as Dark Forest will have to approve them
  • The committee will not spend more than 35% of its budget on any single exchange
In Favor of Pulling Funds
  • Yes
  • No

0 voters

8 Likes
2

I strongly support this. As we engage with more and more exchanges each listing has some cost attached with it. We need a flexible war chest that will enable Index to quickly and effectively respond to exchange listing costs.

I firmly believe that we are in a race to become one of the first crypto Index’s available to the broader public which will unlock truly massive AUM. This is how we win that race.

3 Likes
3

I support the drive and understand the need for the funds. Seems a sensible way forward but also sounds tough - needing careful calculations and decisions. If it goes ahead it would be good to hear back after the first exchange listing: see performance and lessons learned.

4

happy with this. do we need a poll?

1 Like
5

Big fan of this idea.

A slightly different take, there is $125K of DPI in the treasury. Investing this back into product development would be a good way to invest these proceeds.

Also, thinking of it this way, has the benefit of setting the standard for the next products. Generate the capital flows and have it reinvested to compound/accelerate the growth.

We can use either DPI or INDEX, the key for me is DPI is generating solid income. Reinvesting it to generate future income makes perfect sense. I see this as a high ROI investment.

We should definitely be aggressively pursuing being the first DeFi Index listed on the fiat on ramps.

This will create great competitive advantage, add legitimacy, entice a new investor class and will put Index Coop miles ahead of competitors.

The return from doing this is a lot more than what the treasury will earn. It is a no brainer for me.

6 Likes
6

Hey @reganbozman as discussed I think this is a great idea and well worth the investment to get it off the ground.

Can you add a poll to your post, give it 3 days and a For/Against. Provided we have 60% in favour at the end the treasury will get you set up with the budget.

6 Likes
7

Sounds good to me. Lets see what we can do.

2 Likes
8

Let’s get this thing passed and start getting listed!

4 Likes
9

This proposal seems reasonable, I’d be supportive.

In addition to the exchanges mentioned, I’d point out FTX as a particularly attractive venue given their reach and agility in listing high-quality assets, as well as the Coinbase Asset Hub listing process which is a relatively straightforward (and free) way to get that conversation started early.

5 Likes