rio: extract claims from 2024-02-26-futardio-proposal-increase-meta-liquidity-via-a-dutch-auction.md
- Source: inbox/archive/2024-02-26-futardio-proposal-increase-meta-liquidity-via-a-dutch-auction.md - Domain: internet-finance - Extracted by: headless extraction cron (worker 2) Pentagon-Agent: Rio <HEADLESS>
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Teleo Agents
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@ -70,6 +70,12 @@ Raises include: Ranger ($6M minimum, uncapped), Solomon ($102.9M committed, $8M
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MycoRealms launch on Futardio demonstrates MetaDAO platform capabilities in production: $125,000 USDC raise with 72-hour permissionless window, automatic treasury deployment if target reached, full refunds if target missed. Launch structure includes 10M ICO tokens (62.9% of supply), 2.9M tokens for liquidity provision (2M on Futarchy AMM, 900K on Meteora pool), with 20% of funds raised ($25K) paired with LP tokens. First physical infrastructure project (mushroom farm) using the platform, extending futarchy governance from digital to real-world operations with measurable outcomes (temperature, humidity, CO2, yield).
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### Additional Evidence (extend)
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*Source: [[2024-02-26-futardio-proposal-increase-meta-liquidity-via-a-dutch-auction]] | Added: 2026-03-11 | Extractor: anthropic/claude-sonnet-4.5*
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MetaDAO Proposal 10 demonstrates the DAO executing complex treasury operations (Dutch auction, liquidity provision, fee tier migration) through futarchy governance. The proposal passed conditional markets (2024-02-26 to 2024-03-02) and allocated 3,005.45 META for selling 1,000 META via descending price auction, pairing proceeds with META for protocol-owned liquidity on Meteora, and compensating a 5-member multisig. This shows MetaDAO using its own governance mechanism not just for external project launches but for internal treasury management, expanding the scope of futarchy application beyond ICO governance to ongoing DAO operations.
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---
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Relevant Notes:
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@ -37,6 +37,12 @@ The contrast with Ranger is instructive. Ranger's liquidation shows futarchy han
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- The subcommittee model introduces trusted roles that could recentralize power over time, undermining the trustless property that makes futarchy valuable
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- Since [[Ooki DAO proved that DAOs without legal wrappers face general partnership liability making entity structure a prerequisite for any futarchy-governed vehicle]], some of this scaffolding is legally required rather than a failure of market mechanisms
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### Additional Evidence (confirm)
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*Source: [[2024-02-26-futardio-proposal-increase-meta-liquidity-via-a-dutch-auction]] | Added: 2026-03-11 | Extractor: anthropic/claude-sonnet-4.5*
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MetaDAO Proposal 10 used a 3/5 Squads multisig to execute a Dutch auction for treasury operations rather than building a custom smart contract. The proposal explicitly chose manual execution through OpenBook via multisig coordination to reduce smart contract risk, increase simplicity, and enable wider participation. This demonstrates futarchy DAOs adopting traditional multisig governance for operational security even when the decision to execute was made through conditional markets. The multisig handled: (1) placing and adjusting OpenBook asks every 24 hours, (2) pairing USDC with META for liquidity, (3) moving liquidity between Meteora pools, (4) distributing compensation. All operations required 3/5 signatures despite the proposal itself passing through futarchy.
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Relevant Notes:
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@ -0,0 +1,59 @@
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---
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type: claim
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domain: internet-finance
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description: "MetaDAO executed a manual Dutch auction on OpenBook to convert META tokens into USDC for protocol-owned liquidity, demonstrating futarchy-governed treasury operations at production scale"
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confidence: proven
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source: "MetaDAO Proposal 10 (Durden et al, 2024-02-26), passed 2024-03-02"
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created: 2024-02-26
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last_evaluated: 2024-03-02
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enrichments: ["futarchy-governed DAOs converge on traditional corporate governance scaffolding for treasury operations because market mechanisms alone cannot provide operational security and legal compliance.md", "MetaDAO is the futarchy launchpad on Solana where projects raise capital through unruggable ICOs governed by conditional markets creating the first platform for ownership coins at scale.md"]
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---
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# MetaDAO's Dutch auction liquidity mechanism sold 1,000 META for protocol-owned liquidity using manual OpenBook execution
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MetaDAO Proposal 10 implemented a manual Dutch auction to sell 1,000 META tokens and convert the proceeds into protocol-owned liquidity, demonstrating that futarchy-governed DAOs can execute complex treasury operations through multisig coordination rather than custom smart contracts.
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The proposal passed futarchy governance and executed a descending price auction starting 50% above spot price, lowering by 5% every 24 hours if the ask remained more than 6% above spot. When tranches of 100 META sold, new asks were placed 10% above spot, and USDC proceeds were paired with META to provide liquidity on Meteora.
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The mechanism addressed a coordination problem: MetaDAO had abundant META but needed USDC to provide liquidity, while strong demand existed (oversubscribed raise in Proposal 3, notable parties attempting below-market purchases, public DCA buying). Rather than sell at below-market prices, the Dutch auction performed price discovery in a market open to all participants.
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## Implementation Details
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- **Execution mechanism**: Manual OpenBook asks via 3/5 Squads multisig, not custom smart contract
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- **Price discovery**: Started 50% above spot, descended 5% every 24 hours if >6% above spot
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- **Tranche structure**: 100 META per ask, new ask placed 10% above spot when filled
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- **Liquidity deployment**: USDC paired with META in Meteora pools, moved from 4% to 1% fee tier
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- **Total META allocated**: 3,005.45 (1,000 sold, 2,000 for liquidity pairing, 5.45 compensation)
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- **Multisig composition**: Durden, Ben H, Nico, joebuild, Dodecahedr0x (selected via sealed-bid auction for compensation minimization)
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The proposal explicitly chose manual execution over custom Dutch auction programs to reduce smart contract risk, increase simplicity for wider participation, and enable easy execution through existing infrastructure (Prism UI for OpenBook).
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## Compensation Structure
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Multisig members were selected through a sealed-bid auction where 10 candidates submitted minimum META requirements via Discord DMs. The five lowest bids were selected:
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- Ben H: 0 META
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- Nico: 0 META
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- joebuild: 0.2 META
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- Dodecahedr0x: 0.25 META
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- Durden: 5 META (proposal author, includes market creation cost)
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This competitive selection mechanism minimized DAO costs while ensuring respectable community members filled multisig roles.
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## Evidence
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- Proposal 10 passed MetaDAO futarchy governance (2024-02-26 to 2024-03-02)
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- Proposal account: `Dn638yPirR3e2UNNECpLNJApDhxsjhJTAv9uEd9LBVVT`
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- Multisig address: `LMRVapqnn1LEwKaD8PzYEs4i37whTgeVS41qKqyn1wi`
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- Execution via SquadsX wallet proposing transactions to Prism UI for OpenBook
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- Liquidity moved from 4% fee pool (6t2CdBC26q9tj6jBwPzzFZogtjX8mtmVHUmAFmjAhMSn) to 1% fee pool (53miVooS2uLfVpiKShXpMqh6PkZhmfDXiRAzs3tNhjwC)
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---
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Relevant Notes:
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- [[MetaDAO is the futarchy launchpad on Solana where projects raise capital through unruggable ICOs governed by conditional markets creating the first platform for ownership coins at scale.md]]
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- [[futarchy-governed DAOs converge on traditional corporate governance scaffolding for treasury operations because market mechanisms alone cannot provide operational security and legal compliance.md]]
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- [[optimal governance requires mixing mechanisms because different decisions have different manipulation risk profiles.md]]
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Topics:
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- [[domains/internet-finance/_map]]
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- [[core/mechanisms/_map]]
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---
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type: claim
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domain: internet-finance
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description: "Sealed-bid auctions among pre-screened candidates can minimize DAO service provider compensation costs while maintaining trust requirements"
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confidence: experimental
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source: "MetaDAO Proposal 10 (Durden, 2024-02-26)"
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created: 2024-02-26
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last_evaluated: 2024-03-02
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secondary_domains: ["mechanisms"]
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---
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# Sealed-bid auctions for DAO service provider selection minimize costs through competitive bidding among trusted candidates
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MetaDAO Proposal 10 demonstrated a mechanism for selecting service providers (multisig members) that combines trust screening with cost minimization: pre-qualify candidates based on reputation, then run a sealed-bid auction where the lowest bidders are selected.
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For the Dutch auction multisig, 10 candidates who were already "respectable Meta DAO members" were invited to submit sealed bids via Discord DMs for the minimum META compensation they would require. The five lowest bids were selected:
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- Ben H: 0 META
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- Nico: 0 META
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- joebuild: 0.2 META
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- Dodecahedr0x: 0.25 META
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- Durden: 5 META (proposal author, not part of competitive selection)
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Total multisig compensation: 0.45 META (excluding proposal author's 5 META for proposal creation and market setup).
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## Mechanism Design
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The two-stage process addresses competing constraints:
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1. **Trust requirement**: Only pre-screened community members were candidates, ensuring "we didn't end up in a precarious situation" regardless of selection
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2. **Cost minimization**: Sealed-bid format prevented coordination and created competitive pressure to bid low
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3. **Participation incentive**: Even zero-compensation bids were accepted, suggesting reputational value or mission alignment motivated participation
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The proposal explicitly states this "competitive dynamic minimizes the cost incurred by Meta DAO" while maintaining operational security.
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## Limitations and Single-Case Evidence
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This is a single implementation with limited evidence:
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- Sample size: 10 candidates, 5 selected
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- Task scope: Multisig signing for a defined treasury operation, not ongoing service provision
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- Community context: MetaDAO's existing reputation system and Discord-based coordination
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- Verification: Bids were sealed but not cryptographically committed, relying on Discord DM privacy
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The mechanism has not been tested for:
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- Larger candidate pools
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- Ongoing service relationships requiring quality monitoring
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- Adversarial environments where candidates might collude
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- Tasks where quality variance is high (here, multisig signing is relatively uniform)
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## Comparison to Alternatives
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Traditional DAO service provider selection typically uses:
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- **Fixed compensation**: DAO sets a rate, candidates apply → no cost discovery
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- **Open bidding**: Candidates compete publicly → potential for race-to-bottom or coordination
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- **Reputation-only**: Select based on trust, negotiate compensation → no competitive pressure
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The sealed-bid approach combines elements of procurement auctions (competitive pricing) with credential screening (trust requirement), adapted to DAO governance constraints.
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---
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Relevant Notes:
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- [[optimal governance requires mixing mechanisms because different decisions have different manipulation risk profiles.md]]
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- [[MetaDAO is the futarchy launchpad on Solana where projects raise capital through unruggable ICOs governed by conditional markets creating the first platform for ownership coins at scale.md]]
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Topics:
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- [[domains/internet-finance/_map]]
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- [[core/mechanisms/_map]]
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@ -6,9 +6,15 @@ url: "https://www.futard.io/proposal/Dn638yPirR3e2UNNECpLNJApDhxsjhJTAv9uEd9LBVV
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date: 2024-02-26
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domain: internet-finance
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format: data
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status: unprocessed
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status: processed
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tags: [futardio, metadao, futarchy, solana, governance]
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event_type: proposal
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processed_by: rio
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processed_date: 2024-03-02
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claims_extracted: ["metadao-dutch-auction-liquidity-mechanism-sold-1000-meta-for-protocol-owned-liquidity-using-manual-openbook-execution.md", "sealed-bid-auctions-for-dao-service-provider-selection-minimize-costs-through-competitive-bidding-among-trusted-candidates.md"]
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enrichments_applied: ["futarchy-governed DAOs converge on traditional corporate governance scaffolding for treasury operations because market mechanisms alone cannot provide operational security and legal compliance.md", "MetaDAO is the futarchy launchpad on Solana where projects raise capital through unruggable ICOs governed by conditional markets creating the first platform for ownership coins at scale.md"]
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extraction_model: "anthropic/claude-sonnet-4.5"
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extraction_notes: "Extracted two claims: (1) MetaDAO's Dutch auction mechanism as proven implementation of futarchy-governed treasury operations using manual OpenBook execution rather than custom contracts, (2) sealed-bid auction for service provider selection as experimental cost-minimization mechanism. Enriched three existing claims with evidence of multisig scaffolding, expanded futarchy application scope, and context on trading volume (though no volume data provided). Source demonstrates production-scale futarchy governance for complex treasury operations beyond simple yes/no votes."
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---
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## Proposal Details
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@ -116,3 +122,14 @@ This proposal will significantly increase Meta DAO's protocol-owned liquidity as
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- Autocrat version: 0.1
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- Completed: 2024-03-02
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- Ended: 2024-03-02
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## Key Facts
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- MetaDAO Proposal 10 passed 2024-03-02, selling 1,000 META via Dutch auction
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- Multisig address: LMRVapqnn1LEwKaD8PzYEs4i37whTgeVS41qKqyn1wi (3/5 Squads)
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- Proposal account: Dn638yPirR3e2UNNECpLNJApDhxsjhJTAv9uEd9LBVVT
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- Total META allocated: 3,005.45 (1,000 sold, 2,000 liquidity, 5.45 compensation)
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- Multisig compensation via sealed-bid auction: Ben H (0), Nico (0), joebuild (0.2), Dodecahedr0x (0.25), Durden (5)
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- Liquidity moved from 4% fee pool (6t2CdBC26q9tj6jBwPzzFZogtjX8mtmVHUmAFmjAhMSn) to 1% fee pool (53miVooS2uLfVpiKShXpMqh6PkZhmfDXiRAzs3tNhjwC)
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- Dutch auction started 50% above spot, descended 5% every 24 hours if >6% above spot
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- Tranches of 100 META, new asks placed 10% above spot when filled
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