---
type: source
title: "Futardio: Enhancing The Dean's List DAO Economic Model"
author: "futard.io"
url: "https://www.futard.io/proposal/5c2XSWQ9rVPge2Umoz1yenZcAwRaQS5bC4i4w87B1WUp"
date: 2024-07-18
domain: internet-finance
format: data
status: processed
tags: [futardio, metadao, futarchy, solana, governance]
event_type: proposal
derived_items:
  - "decisions/internet-finance/deans-list-enhancing-economic-model.md"
claims_extracted:
- "treasury-buyback-model-creates-constant-buy-pressure-by-converting-revenue-to-governance-token-purchases"
---

## Proposal Details
- Project: IslandDAO
- Proposal: Enhancing The Dean's List DAO Economic Model
- Status: Passed
- Created: 2024-07-18
- URL: https://www.futard.io/proposal/5c2XSWQ9rVPge2Umoz1yenZcAwRaQS5bC4i4w87B1WUp
- Description: The proposed model for The Dean's List DAO involves continuing to charge clients in USDC and using the collected USDC to purchase $DEAN tokens.

## Summary

### 🎯 Key Points  
The proposal aims to enhance The Dean's List DAO's economic model by continuously charging clients in USDC, using the proceeds to purchase \$DEAN tokens, and distributing these tokens as payment to DAO citizens while maintaining the DAO tax in USDC to mitigate price fluctuations.

### 📊 Impact Analysis  
#### 👥 Stakeholder Impact  
DAO citizens will receive \$DEAN tokens instead of USDC, potentially increasing their earnings if demand for the token rises.  

#### 📈 Upside Potential  
The strategic purchasing of \$DEAN tokens is expected to create consistent buy pressure, potentially increasing the token's price and enhancing the DAO's overall market position.  

#### 📉 Risk Factors  
The selling pressure from DAO citizens cashing out a significant portion of their \$DEAN tokens may counteract the buy pressure, leading to price volatility.

## Content

The proposed model for The Dean's List DAO involves continuing to charge clients in USDC and using the collected USDC to purchase \$DEAN tokens. These tokens will be distributed to DAO citizens as payment for their work, replacing USDC payments. The DAO tax will remain in USDC to hedge against \$DEAN price fluctuations. This approach creates constant buying pressure on the \$DEAN token, leading to an increase in price.


The strategic use of USDC for purchasing \$DEAN is expected to enhance the DAO's economic stability and growth.


*Example: DAO Tax @ 20%, Cost of dApp review 2500 \$USDC


This way we create volume (3600 \$USDC volume) and the price action is always positive. (in our case buys exceeded sells by 20%) and we do not deplete our \$DEAN reserves*


- _500 \$USDC goes to the treasury_
- _2000 \$USDC are used for purchasing \$DEAN tokens. The DAO buys 560k \$DEAN (price goes up by X due to the buy)_
- _DAO Citizens are paid the 560k \$DEAN and (assumption) 80% of the paid people decide to sell their \$DEAN to pay their bills._
- _DAO Citizens sell 560k_80% = 448k \$DEAN hits the market to be sold (price goes down by 0.8X)*
- _The price will always achieve a higher low on each cycle._


## Here are more details you don't need but you can explore if you like:


### `Detailed Analysis and FDV Increase Scenario:`


**`Current Metrics:`**


- `FDV of The Dean's List DAO: $337,074`
- `Daily Trading Volume: $500`
- `Circulating Supply: 100,000,000 $DEAN`
- `Current $DEAN Price: $0.00337`


**`Example Scenario:** Assume the DAO reviews 6 dApps in a month, charging 2500 USDC per review.`


- **`Total Monthly Revenue:** 15,000 USDC`
- **`Daily Revenue Equivalent:** 500 USDC/day`
- **`Tax Distribution:`**
    - `20% (3,000 USDC) goes to the treasury.`
    - `80% (12,000 USDC) used to purchase $DEAN tokens.`
    - `Daily purchase of $DEAN: 400 USDC/day`


**`Purchase and Distribution:`**


- `With 400 USDC daily, the DAO buys approximately 118,694 $DEAN daily.`
- `These tokens are then distributed to DAO citizens as payment.`
- `Assuming 80% of $DEAN tokens (94,955) are sold by citizens daily.`


### `Price Impact Analysis`


**`Upward Price Pressure:** Introducing 400 USDC daily into the market represents an 80% increase relative to the current daily trading volume of 500 USDC. This significant increase can substantially impact the price. Given an 80% increase in daily buy volume, we estimate a 24% price increase for modeling purposes.`


**`Downward Price Pressure:** Assuming 80% of the purchased $DEAN tokens are sold by DAO citizens, this sell-off will create downward pressure on the price, estimated at a 15% decrease.`


**`New Price Calculation:`**


- `Initial Price: $0.00337`
- `Estimated Price Increase: 24%`
- `New Price: $0.0041768`
- `Final Price after Sell Pressure: $0.00355028`


**`Calculating the FDV:`**


- `Initial FDV: $337,074`
- `New FDV: $355,028`


**`FDV Increase:`**


- `From $337,074 to $355,028`
- `Percentage Increase: 5.33%`


**`Comparison with TWAP 3% Increase Requirement:`**


- `Required FDV Increase for 3%: 337,074×1.03=347,186`
- `Achieved FDV: $355,028`
- `Achieved Percentage Increase: 5.33%`


`This scenario indicates that the achieved FDV increase of 5.33% significantly exceeds the TWAP 3% increase requirement, demonstrating the potential impact of the proposed model.`


### `Conclusion:`


`This proposal aims to leverage the strategic use of USDC to purchase $DEAN, creating consistent buy pressure that outweighs the selling pressure from citizens, thereby significantly boosting the FDV TWAP. Members are encouraged to support this proposal to enhance the DAO's economic framework and overall market position.`

## Raw Data

- Proposal account: `5c2XSWQ9rVPge2Umoz1yenZcAwRaQS5bC4i4w87B1WUp`
- Proposal number: 3
- DAO account: `9TKh2yav4WpSNkFV2cLybrWZETBWZBkQ6WB6qV9Nt9dJ`
- Proposer: `8Cwx4yR2sFAC5Pdx2NgGHxCk1gJrtSTxJoyqVonqndhq`
- Autocrat version: 0.3
- Completed: 2024-07-22
- Ended: 2024-07-22
