[Temp check] Convert 20% of ENS DAO's USDC Holdings to Glo Dollar (USDGLO) to fund Web3 Public Goods at no cost

Hi, I’m Bram, and I’m with Glo Dollar, the stablecoin that funds public goods.

Overview

We propose that ENS DAO converts 20% (~$920,000) of USDC holdings from the ENS DAO Wallet to Glo Dollar (USDGLO) to fund Web3 Public Goods at no cost.

Doing so has three distinct benefits:

  1. Program Web3 Public Goods Funding into ENS DAO’s treasury through Glo Dollar’s Automatic Public Goods Funding (AutoPGF) Mechanism. By holding Glo Dollars and selecting ‘Web3 Public Goods’ as its funding cause, ENS DAO funds Web3 Public Goods without having to donate.
  2. Strengthen ENS DAO’s resilience by diversifying USDC holdings into multiple native, USD-backed stablecoins.
  3. Support the development of an alternative US regulated stablecoin that benefits the public and the broader crypto ecosystem.

What is Glo Dollar?

Glo Dollar (USDGLO) is the stablecoin that funds public goods.

Stablecoin companies generate $7.4 billion in profits/yield annually from their stablecoin reserves. Our approach is different—we funnel 100% of our profits to public goods and charities.

Holding Glo Dollars creates a virtuous cycle to grow ecosystems, instead of extracting yield for gains. By choosing Glo Dollar, you fund the causes that matter to you, at no cost. Organizations like Mento Labs, Gitcoin, and Polygon Labs are already embedding zero-cost philanthropy into their operations by holding part of their treasury in Glo Dollars.

Choosing the causes to support can be done from our dApp. In ENS DAO’s case, we’d suggest generating funds for Web3 Public Goods (other cause areas focus on poverty eradication and climate action).

Holding $920k in Glo Dollars, ENS DAO would generate up to ~$37,000 in public goods funding per year—this would be akin to funding an extra Small Grants Round at no cost to ENS DAO.

Glo Dollar is available on 7 chains: Ethereum, Celo, Polygon, Optimism, Arbitrum, Stellar, and Base.

How it works

What happens when you buy and hold Glo Dollars:

  1. The fiat backing Glo Dollar is invested and earns revenue (similar to other stablecoins).
  2. We donate 100% of our profits on these investments to public goods and charities.
  3. The user decides which public goods and charities we’ll fund. ENS DAO has the option to allocate all of its generated funds towards supporting Web3 Public Goods.
  4. ENS DAO is funding Web3 Public Goods at zero cost.

We call this Automatic Public Goods Funding, because it is:

  • Simple: just hold a stablecoin
  • Zero-cost: holding a stablecoin is free
  • Embeddable: in treasuries, payroll, card transactions, …

Glo Dollar’s Web3 Public Goods cause area

Right now, the Web3 Public Goods cause area generates funds for Gitcoin, Giveth, and Protocol Guild. We’ll be broadening support to include more initiatives on a rolling basis.

We’re eager to know if there are any specific Web3 Public Goods that ENS DAO would like us to add as a funding recipient.

Learn more about our Cause Areas and How we select Causes to support.

How we’re making Glo Dollar usage zero-cost and straightforward for ENS DAO

  • Swapping Glo Dollars for free. There are multiple routes for ENS DAO to swap USDC for Glo Dollars at zero fees. The Glo Foundation will assist in setting up the easiest route.
  • Direct offramps. We’re partnering with many offramp providers to make instant USDGLO offramps without intermediaries.

Other DAOs and organizations embedding zero-cost philanthropy into their treasury

Many other organizations are embedding philanthropy into their treasury with Glo Dollars, many of which are shown on this page.

Risks

Glo Dollar is 100% fiat-backed, always redeemable 1:1 for USD and USDC, issued and regulated in the United States, and receives monthly independent attestations.

In April, we received our Bluechip rating, with an initial B grade. This places us in the top 10 fiat-backed stablecoin, and we’re deemed safer than Tether’s USDT, FRAX, FDUSD, among others. Glo Dollar received the following assessments:

  • Stability: Stable
  • Management: Very low risk
  • Governance: Low risk

Glo Dollar is developed by the Glo Foundation and is issued by Brale. Brale is a US regulated money services business, which is the same regulatory framework under which Circle issues USDC.

Voting

The voting options will be:

  1. ‘Yes’ - Swap 20% of ENS DAO’s USDC into USDGLO.
  2. ‘No’ - Do not swap 20% of ENS DAO’s USDC into USDGLO.
  3. ‘Abstain’

Relevant links

2 Likes

That assumes profits surely?

Theres a cost somewhere - who is taking on the risk?


ENS has a DAO funded Public Goods Working Group that does incredible work supporting public goods. I personally believe that all PG related activities should be directed through that working group.

5 Likes

Thanks for the questions, @clowes.eth.

We profit up to $40k per $1M in USDGLO market cap per year.

Our profit model mirrors that of USDC by Circle. Part of our reserves are held in US Treasuries, which currently offer a yield of approximately 5%.

In the case of USDC, all profits go to Circle and none to the crypto ecosystem.

Given that ENS DAO’s wallet holds $4.6M in USDC, the DAO is currently funding Circle for ~$180,000 in yield/revenue per year.

By holding Glo Dollar (USDGLO) instead, ENS DAO would be generating funds for public goods and charities—at no cost to the DAO. We could use (part of) these funds to support the projects funded by the ENS Public Goods Working Group.

See the full flow of funds (and how Glo Dollar works) here.

The ‘cost’ is the same as holding USDC in your treasury: you’re missing out on directly holding US Treasuries yourself. So yes, there’s a cost, but no additional cost vs what’s currently happening.

These profits are profits that are currently going to Circle. So ENS DAO swapping USDC to Glo Dollar means a transfer of profits from Circle to public goods, at no (additional) cost to ENS.

Arguably, one downside of holding USDGLO over USDC is that, as a newer market entrant, it isn’t as widely accepted yet. You can, however, always swap USDGLO 1:1 through our minting / redemption portal and 5+ OTC partners.

We love the Public Goods Working Group, and want to see it succeed.

(Part of) the profits generated from the Glo Dollars held by the ENS DAO could be allocated to the projects funded by the Public Goods Working Group. This way, we can ensure that all activities related to public goods are directed through the working group.

This can be similar to how we’re funding Celo Public Goods with the Glo Dollars in the Mento Reserve.

1 Like

I would love to hear Karpatkey’s opinion, on all of this, but especially what I would like to propose…

I would love to see is for the DAO to hold a huge USDC/USDGLO liquidity pool so it could earn a small amount of trading fees while supporting USDGLO as well.

I LOVE USDGLO. If we are holding USDC, it is a no brainer to send it to Brale and get USDGLO back. There is almost no liquidity risk and the upside is funding public goods.

I have a small conflict of interest to declare, in that Glo Dollar has sponsored several QF Rounds on Giveth, and has donated some of the revenue generated to Giveth. Giveth may have received around $5000 in direct funding from those activities. But honestly that is negligible to our costs, and has nothing to do with why I am a big supporter of this proposal.

If we are holding stables, we should hold USDGLO.

2 Likes

Hi Griff, here’s some data if it helps:

The largest single position of stables the DAO holds is in the DAO wallet and it’s currently at 3.4 million.

We had initially intended that the DAO hold 2 years expenses in stables. We had a discussion on that here. At the time, that two year runway required 16 million in stables.
That amount has been spent down to about 3.4 million now, and we’ve been in early talks to swap some of the 7k ETH in that wallet to ensure we maintain the runway. We also need to reevaluate the 16 million number because some scenarios that Labs has discussed would require more spend.

The other notable point to include is that the stream to ENS Labs is delivered in USDC. While that doesn’t make it undoable, it does mean that we need to contemplate that in any plans we make.

1 Like