https://deepdao.substack.com/p/is-this-a-healthy-dao-treasury-deepdao

Over 20 billion USD are currently managed by DAOs, even in the bear market. Given the exceptional growth of the DAO ecosystem over the past 4 years, surpassing $100 billion sometime in the next few years is not impossible.

DeepDAO, with the largest collection of tracked DAO treasuries, is focused on analyzing these funds. Today, we’re excited to announce the release of a collection of new API endpoints, aiming to help users understand the magnitude of these treasuries, their impact, and the asset management strategies used by DAOs.

How to use DeepDAO’s Treasury Health API

Currently, 1050 EVM treasuries across Ethereum, Polygon, Optimism, Arbitrum, Gnosis chain, and other chains are being tracked. Imagine a hypothetical DAO—DAO 1. Firstly, we analyze the number of individual wallets linked to this treasury and their chain associations. This data is accessible through our treasury by chains breakdown endpoint, ‘chains_treasury_breakdown.’

For ease, let’s consider our test DAO has a single treasury address, although some hold more than 10 wallets on different chains.

Relying on the DAO’s token

Starting our treasury investigation, accessing ‘/v0.1/treasury/breakdown/{organization_id}’ unveils the treasury’s token holdings and their respective chain details.

An essential question arises: What is the treasury’s dependence on the DAO’s own token? Certain DAOs allocate over 99% of their holdings to their native token, while others diversify their holdings in a more balanced manner. 

A significant portion of the treasury allocated to the DAO’s token might suggest a vulnerability, yet this assessment heavily relies on the token’s actual strength. For instance, if it’s a robust token within the top 100 like Uniswap, Optimism, or Arbitrum, it fortifies the treasury. Conversely, if the token ranks lower, is relatively new, or demonstrates minimal trading volume and liquidity, it may affect its DAO health score (in development) negatively.

Stablecoins 

Assuming the DAO isn’t heavily reliant on their own token, it’s essential to examine which other tokens they hold. The first question may pertain to the presence and percentage of stablecoins within the treasury.

Stablecoins play a critical role in ensuring the treasury’s stability. For instance, a DAO holding 36 months of runway in stablecoins mitigates the risk of financial troubles during a bear market. A higher percentage of stablecoins signifies the DAO’s risk aversion towards its future.

To assess stablecoin holdings in a DAO’s treasury, utilize the ‘organization_treasury_stablecoins’ endpoint. By inputting the organization_id, you’ll receive information on stablecoin holdings. The stablecoins currently tracked include: 

• USDC

• USDT

• DAI

• TUSD 

ETH

Likewise, a DAO might consider maintaining a significant amount of ETH in their treasury. Although ETH isn’t particularly stable in traditional terms, it holds immense importance within the Ethereum and L2s ecosystem.

To explore this, use the ‘organization_treasury_eth’ endpoint, which tracks ETH, WETH, stETH, and wstETH.

Investment strategy 

Moving to the next API endpoint, we’ll explore the DAO’s investment strategy, delving into how it utilizes its funds within DeFi.

For our treasury health observations, we’ll temporarily disregard critical questions such as whether the DAO is progressing towards its objectives, developing its product, or actively promoting it. These inquiries relate to governance and organizational management and will be covered in future articles.

Today’s focus is on DAOs and their involvement in DeFi investments. The ‘organization_treasuries_assets’ endpoint details whether a DAO is staking portions of its treasury, utilizing lending or borrowing protocols, engaging in liquidity pools, or participating in farming. This analysis allows for comparisons with other DAOs or the broader ecosystem behavior via our top 20 lists.

As an example, here’s how Gnosis DAO operates in this context:

Timeseries 

To conclude our assessment of DAO treasury health, we introduce two additional endpoints. The first, ‘daily_dao_treasury/{organization_id},’ tracks the treasury’s movement over time.

The second endpoint, ‘organizations_with_similar_treasury_tokens,’ offers an ecosystem perspective by comparing the DAO’s treasury to others. It identifies DAOs holding similar tokens for a comparative view.

Treasury endpoints

A full list of our API endpoints is available here. To purchase a subscription please refer to the plans page. The treasury endpoints require the DAO Analytics subscription. 

These are the endpoints related to treasury health discussed in this article: 

1. Breakdown by chains: /v0.1/ecosystem/chains_treasury_breakdown

2. Treasuries breakdown: /v0.1/treasury/breakdown/{organization_id}

3. Get Organization treasury assets: /v0.1/treasury/organization_treasuries_assets

4. Get Organization treasury ETH: /v0.1/treasury/organization_treasury_eth

5. Get Organization treasury stablecoins: /v0.1/treasury/organization_treasury_stablecoins

6. Organizations holding tokens in treasury: /v0.1/treasury/orgs_holding_tokens_in_treasury

7. Organization’s treasury ETH: /v0.1/treasury/top_organizations_treasury_eth

8. Top treasuries without DAO Token: /v0.1/treasury/top_treasuries_without_project_token

9. Treasury without DAO Token: /v0.1/treasury/treasury_without_project_token

10. Get organizations with similar treasury tokens: /v0.1/organizations/organizations_with_similar_treasury_tokens/{organizationId}

11. The daily total treasury of an organization: /v0.1/timeseries/daily_dao_treasury/{organization_id}

Optimism’s RetroPGF application

DeepDAO has qualified to receive funding through Optimism’s RetroPGF grant, in the Collective Governance section. We take pride in our contributions to the DAO ecosystem overall, and particularly within Optimism. 

You can review our application here. If you’re a badge holder, we will appreciate your support! 

About DeepDAO

DeepDAO is the #1 discovery and analytics engine for the DAO ecosystem. We aggregate, list, and analyze financial and governance data for thousands of DAOs and millions of governance token holders and voters. DeepDAO is widely recognized in the ecosystem, and media as the go-to source for data about DAOs. Our data is available for purchase. 

• Website: https://deepdao.io

• Twitter: https://twitter.com/DeepDAO_io

• Discord: https://discord.com/invite/BQBEUS9V9N

https://deepdao.substack.com/p/deepdao-announces-voting-labels-for

The DAO ecosystem is not only growing but also maturing. With hundreds of meaningful DAOs and millions of voters, tools tailored for DAOs are on the rise, signaling the evolution of DAO culture into a more robust and professional realm.

DeepDAO’s mission is to provide actionable insights for the DAO ecosystem, and help people collaboratively manage their assets. To that end we have created voting and participation labels for over 2.5M voters. This is the first ever such effort, and it accentuates the significance, and uniqueness of DAOs as an asset class. 

Take for example one voter’s profile on DeepDAO. The labels for this wallet are on the left side of the header. Note that on the site we are showing eight labels by default, and overall there are no less than 39 distinct labels. 

Label Types

There are three distinct types of voting labels. 

Category labels 

• DeFi voter

• NFT voter

• Infrastructure DAOs voter

• Gaming voter

• Investments voter

• Media & Communications Voter

• DeSci

• Physical Assets

• Others…

Overall there are 13 DAO category labels, reflecting the number of DAO categories on our dashboard. For a full list see here. 

Voting experience labels 

• DAO Voter (given to an address, if it voted in DAOs)

• DAO voter 2019 (the address voted in a DAOs as early as 2019)

• DAO voter 2020 

• DAO voter 2021

• DAO voter 2022

• DAO voter 2023

• On-chain voter 2019 (2020, 2021, 2022, 2023)

• Off-chain voter 2019 (2020, 2021, 2022, 2023)

• Top 1% Voter (as ranked by DeepDAO’s G-score)

• Top 5% Voter

• Two organizations voter (voted in a minimum of 2 DAOs)

• Five organizations voter (voted in a minimum of 5 DAOs)

• Ten organizations voter (voted in a minimum of 10 DAOs)

In this section we are also labeling voters as Nonsensical, which means that they voted, at least once, in a meaningless, nonsensical governance system, and may or may not be a vote miner. (Addresses that vote primarily in the hope of gaining future airdrop rewards, are called Vote Miners).

Delegation labels

• Delegate 

• Delegator

• Multiple Delegate (serves as a delegate in multiple organizations)

• Multiple Delegator (delegated voting power in multiple organizations)

Label Benefits for DAOs and Individuals

DeepDAO’s labels, mapping the entire voting ecosystem, have several benefits for the stakeholder groups in the ecosystem. 

For DAOs

DAOs that use DeepDAO’s labeling system will better understand their voters, and identify their personal interests and their needs. This will enable DAOs to answer questions such as the following: 

• Is a particular address active in DAOs? In which DAOs?

• Does a job applicant have tangible experience in DAOs? How often have they voted? When did they start getting involved?

• Which categories of DAOs this person is involved with? Are they interested in DeFi DAOs? Investment DAOs? Gaming?

• Is this person a delegate? A delegator? 

Going deeper, DeepDAO’s labeling system allows DAOs to create segmentations of their voters, and token holders, and understand their voter population as a group. For example, are my voters interested more in Infrastructure projects, or in the rising web3 Gaming sector? Are they moving into Work & Funding type DAOs, and does this trend intersect with the current bear market? 

Having this information on hand will help DAOs and DAO tools improve marketing efforts, voter participation, and community involvement. 

For wallet owners

For wallet owners, DeepDAO’s labels, and our voter profiles provide a rich attestation of your involvement in DAOs: the governance identity you created, and will help you find people you are interested in, and help them find you in return. 

For instance if you’re looking for a job in DAOs you can show off your DeepDAO profile, with all your labels, votes, and created proposals. Along with your LinkedIn profile, or your Github, send them your DeepDAO page — it may be what differentiates you from others. 

Where can I find the labels? 

DeepDAO’s voter labels are available on our website and in our paid API. To see them on the site, navigate to your profile on DeepDAO and observe your own address’ labels, or search for any other voter’s profile and see theirs. Viewing the labels is totally free on the site. 

For DAO tools, VCs, academics and other researchers, our labels are available through paid API. The API’s documentation can be found here. 

About DeepDAO

DeepDAO is the #1 discovery and analytics engine for the DAO ecosystem. We aggregate, list, and analyze financial and governance data for thousands of DAOs and millions of governance token holders and voters, across different chains and governance platforms. DeepDAO is widely recognized in the ecosystem, and media as the go-to source for data about DAOs. Our data is available for purchase. 

https://deepdao.substack.com/p/deepdao-research-presents-the-hunting

In a research conducted recently, DeepDAO found at least a few dozen Snapshot spaces that voted mainly on proposals that seem to lack any serious or operative meaning. Proposals on these DAOs read something like, “Can BTC fall below 30,000?” Or, “is crypto market still bullish in Q2 of 2022?”, “Are you all doing airdrops?”

We term these spaces “Nonsensical DAOs”, and the wallets that vote or propose on them, “Nonsensical wallets”.

Nonsensical Spaces often share more features with other Nonsensical ones, for example their voting token, space title, and repeating proposal titles. None of them ever supply any context: no website or social address, treasury or otherwise something beyond the minimum necessary for operating a Snapshot space. 

The governance data of Nonsensical DAOs and wallet addresses present a distinctive network of governance patterns, which lead us to consider disqualifying their governance action from DeepDAO’s aggregated content, and removing some of their voting wallets from our legitimate governance data.

How To Identify Nonsensical DAOs 

In this article we describe a generalized path to replicate this research, using DeepDAO’s API. We will also provide one example of Nonsensical DAOs network, with real-data numbers.

Step 1: Identify DAOs to investigate.

The easiest way to identify these groups of spaces is to find all the organizations that vote on the same token. While this is not the only method for grouping DAOs, it is certainly a powerful one and can be easily tracked in DeepDAO’s database. As we observed, there are quite a few spaces that fall under this grouping. For example check this one, with no less than 17 spaces voting on Polygon’s Matic token. 

Step 2: Scan the group you identified for nonsensical proposals. 

Scan these spaces for proposals that seem to lack any serious or operative meaning, such as the ones mentioned above. Good leads from our API are repeating proposal titles, or token names in proposal titles. 

Step 3: Check the names of these DAOs’ Snapshot spaces for similar titles. In one example, we found 17 DAOs that had their proposal titles as some variation of Polygon or MATIC. In another, DAO titles are variations of AAVE, while the voting token is $wMATIC. On these organizations’ DeepDAO page you can see all the spaces grouped together. 

Step 4: Check for similar ENS domain names by which Nonsensical spaces are registered. In the Aave-named case mentioned above, 12 of the 29 domains are gitcoin001.eth, gitcoin002.eth, gitcoin012.eth, etc.  

In yet another case (lumao), we find domain groups of 7 and 13 digits ENSs. 

10s of Thousands of Participating Wallets 

Step 1: Fetch voting and proposal-making frequency of your nonsensical DAOs, and compare them with those of relevant control groups. We tested the average activity of the Nonsensical DAOs named Polygon/MATIC compared to all other Snapshot DAOs’, and to a group of 10% topmost voting ones.

Our findings include:

1. The average voting and number of voters of these Nonsensical DAOs are 7X and 10X higher than all other Snapshots spaces, and similar to the averages of 10% of the topmost voting ones.

2. The Nonsensical DAOs make on average 3X more proposals than the 10% topmost voting Snapshots, with 10X their distinct proposal makers. Compared to all other Snapshots, the differences rise to 10X proposals and 39X proposers!

3. While the reviewed Nonsensical Snapshots are voted at similar rates to the most multi-tasking and veteran DAO projects, their voting attention is spread between much more proposals. To put it simply, their activity is much thinner than that practiced by the top DAOs.

Step 2: Decide where to put the thresholds. In other words, is the Nonsensical DAO activity unusual enough, so as to be excluded from genuine DAO behavior data? 

In our case:

1. The voting rates of Nonsensical Snapshots are much higher than those of the group of all other Snapshots, and their proposal-making is distinctively higher even compared to topmost-voting ones.

2. The coordination mechanics of these nonsensical DAOs is hence found to enable the management of exceptionally heavy voting and proposal-making, between tens of thousands of participant addresses, which spread their attention exceptionally thin over a long period of time, and without any public footprint, documentation, social space or visible tokenomics. 

We find this sufficient to reduce all voting and proposal-making made in these DAOs from our governance totals and DAO Participation Scores.

Voting patterns of Nonsensical DAO Wallets 

Our research found that wallets that voted on nonsensical DAOs, also vote often in DAOs that have genuine Snapshot spaces. This is how we identified this behavior: 

Step 1: Query DeepDAO’s database for the activity of your Nonsensical wallets in all other DAOs. What are these wallets doing besides being Nonsensical? Our lead example is the Polygon/MATIC Snapshots, and their total of 43,051 voting wallets.

We found that 22,711 Nonsensical wallets have so far voted in at least 1 legitimate DAO, totalling 507,192 votes over 2,208 different Snapshots.

1. About 50% of these votes have been cast in either of 15 well-known project Snapshots such as Optimism, Aave, Arbitrum, Stargate, Uniswap, Decentraland, and Ape Coin, followed by dozens of other identified projects.

2. Intense voting by Nonsensical wallets on other Nonsensical spaces was also observed.

Step 2: Query activity data by Nonsensical wallets in all legitimate Snapshots spaces, and compare it with those of all Snapshot voters / chosen control groups.

1. In our example, Nonsensical addresses have voted in other DAOs an average 22.31 times each, which is 3.5X higher than the average Snapshot voters of 6.12 votes.

2. Nonsensical addresses have voted in 5.87 other DAOs per address, compared to an average of 1.71 DAOs voted-in by all Snapshot voters, which is 3.4X higher. 

Per-address Voting rates are hence distinctively high. 

Step 3: Choose a well-known DAO to see if your Nonsensical wallets vote in bulk on it.

1. For example, we focused on two of the topmost-voted DAOs by Polygon/MATICs addresses, namely: Optimism and Arbitrum Snapshots.

2. We also considered possible governance incentives. For example, Arbitrum Snapshot proposals were declared part of its launching campaign, which lead to becoming eligible for an airdrop; Many Optimism proposals are asking voters to choose between airdrop-likely projects, and to influence their identities.

Step 4: Query Nonsensicals’ voting on your chosen legitimate DAO, and test whether it is exceptionally high. Here is an examples for our Polygon/MATIC Nonsensical spaces:

Example 1: Voting on Optimism Snapshot space (opcollective.eth):

1. We studied the 1,908 Nonsensical addresses that voted on Optimism. Together, those total 69,194 votes there, covering Optimism’s entire 93 proposals from 9.6.2022 to 18.1.2023. 

2. Each Nonsensical address has voted an average 36.27 times on opcollective.eth, which makes almost 3X the 12.91 average by the DAO’s total 88,657 voters. Repeated querying of randomized n=1,908 from among all Optimism voters corroborates this as results are closely aligned around the total average.

Next Steps 

In conclusion, there seems to be a collective effort going on here. We don’t want to presume what is the motivation behind it, before conducting further research, and so we continue to enhance and refine our findings. One such effort is to find more examples of Nonsensical spaces, and their activity. 

Another ongoing research compares the list of wallets we find within these DAOs, with their activity once they received an airdrop from well known projects such as Optimism and Arbitrum.

Stay tuned for more! 

The Nonsensical spaces identification effort was conducted by Noam Hof, DeepDAO’s head of research.

A Growing Use Case for DAOs: Decentralized Science 

One of the growing use cases for DAOs is decentralized science. As the #1 aggregator for DAOs, DeepDAO stays on top of the DeSci movement with a categorization of these DAOs, and research into their data. 

Our Decentralized Science category currently lists 17 DAOs, the largest of which by treasury are VitaDAO, and ResearchHub. 

Hackathon Bounties 

DeepDAO has two bounties in the Global DAO Hackathon, organized and coordinated by Aragon. 

These are the DeepDAO bounties: 

1. Finding Ideal Wallets for Airdrops Among Governance Participants (this one is related to the topic of our research above). 

2. Onboarding DAOists to DeepDAO. 

To see the bounties head to the DAO Global Hackathon 2023 Bounties page.  

About DeepDAO

DeepDAO is the #1 discovery engine for DAOs, and the top tool for aggregating, listing, and analyzing governance. With thousands of listed DAOs, and millions of governance participant profiles, DeepDAO is a vast network of social and work-related connections in the Web3 space. Top research teams, leading media institutions, VCs and DAOists rely on DeepDAO data to report on the explosively growing DAO ecosystem. 

Site: DeepDAO.io 

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