teleo-codex/decisions/internet-finance/deans-list-implement-3-week-vesting.md

type	entity_type	name	domain	status	parent_entity	platform	proposer	proposal_url	proposal_date	resolution_date	category	summary	key_metrics	tracked_by	created
decision	decision_market	IslandDAO: Implement 3-Week Vesting for DAO Payments	internet-finance	passed	deans-list	futardio	proPaC9tVZEsmgDtNhx15e7nSpoojtPD3H9h4GqSqB2	https://v1.metadao.fi/deans-list/trade/C2Up9wYYJM1A94fgJz17e3Xsr8jft2qYMwrR6s4ckaKK	2024-12-16	2024-12-19	treasury	Linear 3-week vesting for all DAO payments to reduce sell pressure from 80% immediate liquidation to 33% weekly rate	weekly_payments previous_sell_rate post_vesting_sell_rate sell_pressure_reduction projected_valuation_increase pass_threshold_mcap baseline_mcap 3,000 USDC 80% (2,400 USDC/week) 33% (1,000 USDC/week) 58% 15%-25% 533,500 USDC 518,000 USDC	rio	2026-03-11

IslandDAO: Implement 3-Week Vesting for DAO Payments

Summary

Proposal to implement linear 3-week vesting for all DAO payments (rewards, compensation) via token streaming contracts. Aimed to reduce immediate sell pressure from 80% of payments being liquidated weekly (2,400 USDC of 3,000 USDC) to 33% weekly rate (1,000 USDC), a 58% reduction. Projected 15%-25% valuation increase through combined sell pressure reduction (10%-15% price impact) and improved market sentiment (5%-10% demand growth).

Market Data

• Outcome: Passed
• Proposer: proPaC9tVZEsmgDtNhx15e7nSpoojtPD3H9h4GqSqB2
• Resolution: 2024-12-19
• Pass Threshold: 533,500 USDC MCAP (baseline 518,000 + 3%)

Mechanism Details

• Vesting Schedule: Linear unvesting starting day 1 over 3 weeks
• Implementation: Token streaming contract
• Target: All DAO payments (rewards, compensation)
• Rationale: Discourage market manipulation, support price growth, align recipient incentives

Significance

Demonstrates futarchy-governed treasury operations addressing sell pressure dynamics. The proposal included sophisticated market impact modeling: 80% immediate liquidation rate, weekly payment flows (3,000 USDC), sell pressure as percentage of market cap (0.81% reduction over 3 weeks), and price elasticity estimates (1%-2% supply reduction → 10%-20% price increase). Shows how DAOs use vesting as tokenomic stabilization rather than just alignment mechanism.

Relationship to KB

• deans-list - treasury governance decision
• time-based-token-vesting-is-hedgeable-making-standard-lockups-meaningless-as-alignment-mechanisms-because-investors-can-short-sell-to-neutralize-lockup-exposure-while-appearing-locked - vesting as sell pressure management
• futarchy-adoption-faces-friction-from-token-price-psychology-proposal-complexity-and-liquidity-requirements - proposal complexity example

Full Proposal Text

Source: futard.io, tabled 2024-12-16

Summary

Introduces a 3-week vesting period for all DAO payments, where payments unvest linearly starting from day 1.

Rationale

1. Discourage Market Manipulation: Vesting prevents immediate liquidation
2. Support Price Growth: Slowed token release creates buffer period for price stabilization

Implementation

• All payments vest over 3-week period with linear daily schedule
• Distributed via token streaming contract

Valuation Assumptions

• Current selling pressure: 80% (2,400 USDC of 3,000 USDC weekly payments sold immediately)
• With vesting: only 33% liquidated each week (1,000 USDC), reducing sell pressure by 1,400 USDC/week

Projected Outcomes

Scenario	Price Increase	New Valuation	Increase
Conservative	15%	595.7k	77.7k
Optimistic	25%	647.5k	129.5k

TWAP Calculation

• Current MCAP + 3% = 518,000 + 15,540 = 533,500