Treasury

What is Treasury?

A treasury is a smart contract or multisig wallet holding a DAO's collective assets tokens, stablecoins, and ETH. Spending is controlled by community governance: members propose, vote, and smart contracts execute automatically upon approval.

How does Treasury work?

1. Tokens are allocated to the treasury at genesis and held unspent.
2. A member proposes a spend e.g., allocate funds to a developer grant.
3. The community votes; if approved, the smart contract transfers funds automatically.
4. All holdings and transactions are publicly visible on-chain.

Why does Treasury matter?

A well-managed treasury gives a DAO years of financial independence. It signals long-term viability and removes the need for external fundraising that would dilute token holders.

Key features of Treasury

• Collectively owned no single person controls it
• Spending requires governance approval
• Fully transparent and auditable on-chain
• Often holds a mix of governance tokens, stablecoins, and deployed assets

Examples of Treasury

Uniswap's treasury holds governance tokens for ecosystem grants. Aave's treasury funds security audits and protocol development.

MakerDAO's treasury holds MKR, DAI, and deployed collateral, making it one of the most diversified DAO treasuries.