Realizing Profits

Assets of the projects that the DAO invests in are held by the treasury and proportionally owned by the community so the treasury will not sell these assets and retain the profits. From time to time the treasury will unlock some or all of these assets to the community so that members can realize profits in exchange for burning some of their staked MFI which in turn reduces MFI token supply (Treasury Claims).

General assets held by the treasury e.g. BTC, ETH, BNB may be sold by the treasury at any time as doing so would not create significant selling pressure on these assets and it would not negatively impact the DAO or the Web3 projects that we have invested in.

Ideally, the community should decide via a vote on the timing of when the treasury sells or releases each asset but the reality is that MetFi would be publicly announcing that it was considering selling or releasing some or all of its holdings of a particular asset so the DTF should have the authority to discreetly realize profits for the treasury or release assets to the community when feasibly possible.

Cliff Vesting

MetFi primarily invests in early-stage Web3 start-ups which often means the treasury will not receive assets from the project at the same time that our investment was executed because the assets are yet to be minted – a SAFT agreement is signed in these cases which is essentially a legal agreement that the project will send their assets to the treasury after their Token Generating Event (TGE).

Furthermore, in some cases the project assets are released to the treasury incrementally and therefore cannot be released to the community and sold before a pre-agreed period of time has elapsed which is known as the Cliff Vesting Schedule.

For example, let’s say the DAO has agreed to receive 12 Million tokens (assets) in exchange for its investment in a project with 1 million tokens released to the treasury per month after the TGE. This would mean that the DAO is not ‘fully vested’ until 12 months after the TGE.

Another important consideration is the timing of when these assets should be released to the community and in what proportions so that members can swap staked MFI for the assets and realize profits (Treasury Claims).

In most instances, the projects will take some time to mature seeing that the DAO invests in early-stage Web3 start-ups and it’s important for members to understand this and exercise some patience and investor discipline.