Above Average Joe and DaddyMatty discuss a few details of Compensation 3.0, including tax-optimization and vesting methods.
Treasury Management [19m]
The team and community work to define what constitutes a “core asset.” High-level requirements should be that the asset is highly liquid and able to be used as collateral for yield (e.g., BTC, ETH, stablecoins).
Above Average Joe suggests that a core asset could be “the native asset of any chain that Rook has a presence on” – i.e., an asset that is required to be held in order to operate on a particular network.
There is a discussion regarding what risk management criteria should be used for core versus risk asset holdings. For example, 85% of treasury assets should be held as core assets with a lower bound of 75%. The team should also ensure that individual non-core assets do not exceed 5% of the treasury.
Discussion on defining risk strategies continues; the goal is to maintain stability of treasury assets while still exploring yield-bearing strategies and the ability to assume risk when deemed appropriate.
The community brought up the possibility of an operational endowment. However, the sustainability of DeFi rewards is likely too inconsistent for this to be feasible.
It’s important to note that the Treasury is slow-moving compared to individual actors, and this should be taken into account when discussing risk strategies (e.g., understanding the possibility of being front-run due to public plans).
The Compensation 3.0 plan takes into account inflation and salaries in the wider tech industry, and Rook is actively monitoring the market in order to stay competitive.