DYdX Foundation Puts Forward Fundraising Proposal, Seeks $30M

DYdX Foundation Puts Forward Fundraising Proposal, Seeks $30M
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$30 million in funding has been requested by the dYdX Foundation, the foundation that aids in the development of decentralized exchange dYdX, from the governing decentralized autonomy organization for the project. 

Legal services are offered by the Dydx Foundation. 

dYdX Foundation Requests Funding 

According to the dYdX foundation, the requested $30 million will be spent over the next three years. Legal, technical support, marketing, and R are just a few of the areas where the Dydux Foundation assists the project. A perpetual futures contract exchange and a specialty blockchain in both the Cosmos and Ethereum ecosystems are featured in the DYDX trading project. The foundation aims to assist DYdX in becoming the 'exchange layer of the internet'. 

Supporting and accelerating the growth of a robust DYdX ecosystem can be facilitated by the DYdX Foundation. According to the foundation's plan, the dydx chain will be the backbone of the biggest defi protocol worldwide, providing access to any asset with a price feed for trading. The internet's exchange layer will be governed by code and controlled by its stakeholders with the DYdX Chain becoming the exchange layer.”

The $30 million would consist of 10.5 million DYDX tokens, expanding the Foundation’s operational runway beyond 18 months. 

No Small Request 

The foundation has requested a large budget. The foundation could receive 4% of the dao's current treasury if given permission by those who hold dydx tokens. The dydx foundation won't have to submit annual budgets for review and approval since it's spent over the next three years, which is a common practice for other daos and their foundations. Following the foundation's initial sharing of the request on Friday, it has already been widely accepted by stakeholders. 

The vote for the request is now taking place and will last until February 2nd. Payroll would be covered by half of the requested budget, with marketing and growth being allocated 18%. Legal expenses will account for 14%, while contractors will receive 5.5% and other items will receive 5.5%. 

Reducing Risk

The Foundation also outlined its commitment to responsibly managing money through capital preservation strategies that will help it reduce risk. After last March's banking crisis and the subsequent de-pegging of stablecoin, they have shifted their diversification away from USDC and towards Treasury bonds. Although this move away from cryptocurrency was beneficial, it significantly reduced risks while increasing yields. 

Our finance team has always emphasized the importance of Treasury management and asset protection. To ensure capital preservation, maintain liquidity, and generate additional yield are the main objectives of our investment policy. Several new approaches and policies were put into effect in 2023 by us. Our $6M investment bond ladder strategy in US Treasuries was deployed successfully, reducing our USDC exposure by over 90%, 3x'd our previous APY, and significantly reducing the risk of counterparties.”

The Foundation also added that it would diversify some of the funds into fiat and stablecoins and invest in expanding its staking operations. The Dydex Foundation is currently generating income from around 2.5 million Dydex tokens. The next budget request will likely arrive in mid-2026, close to the 18-month runway if this request is approved. An annual and semi-annual report on the utilization of the funds was stated by the foundation.