Returning Value to ANT Token holders via Buyback

Who is talking about Rugging, I have been in here engaging productively.

Hi, no worries about you - I was referring about BearBudget’s remark about the repurposing of the treasury and the general goal of the project.

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Also just to flag that the teams came in to the DAO in good faith, first teams to do that at Aragon and were transparent with our roadmap, plans and budgets. We are here to make the DAO work and build a product with PMF. Also the current team has been here from less than 2 years.


Disclaimer: This is purely my personal opinion. I’m serving as Executive Director of Aragon Association since 01.07.22 in a 1y tenure and also sitting at AA committee since 18.12.22. I plan to stay at the Committee until most of the treasury have been safely transferred to the Aragon DAO. I don’t speak on behalf of AA. Not investment advise.

Thanks for your proposal and for making your intent clear. I would like to focus my reply on the core topic of your proposal.

Few comments:

  • I agree that a treasury diversification initiative such as the one your propose would help mitigate the current discount to book value. However, the perceived gap is not as large as you point out. Please note that there’s at least around $40M of funds that can not be transferred to the DAO, as Luis pointed out here. The final transferable amount may also differ depending on the needed OPEX for AA and Aragon Shield Foundation.This significantly reduces the perceived gap between MCAP / BV. Having said this, I am still support of increasing the available ANT to distribute across aligned stakeholders.
  • Aragon DAO has as a Guideline (indirectly enforceable by token holders) to cap its yearly OPEX to 10% of the treasury. I believe that is more than enough to cover current Guilds runaway. There’s also a Financial Guideline to use 25% of the treasury to be deployed in Yield generating initiatives. So, I agree on the statement that there’s excess treasury that could be deployed. It’s important to balance that with keeping enough runaway for further OPEX.
  • On buying ANT as treasury diversification: I have believed in the benefits of doing such a move for a long time. In fact, I defended for a larger purchase of ANT back in Q4 2022, and I was the one proposing it at the AA Committee back then. The only reason we didn’t do a larger one was because we wanted to wait until being able to do so via the Aragon DAO (and we could not do it yet via the DAO as the Delegate voting system was being developed).

After reading all the feedback from different proposals in the forum, I have asked our legal counsel to see if there are ways to address this. While AA can not perform a pre-announced “buyback” for the reasons I already explained here, there may be a way for Aragon DAO do achieve that. I’m not a lawyer, so @ronald_k please confirm that I am not missing anything here. This can be further validated with 2nd opinions if needed by the Aragon DAO.

It’s my intent to provide clarity on some constraints so that the community can work on a proposal that can be voted in due time in Aragon DAO.

Constraint 1

Funds to deploy must be Aragon DAO’s, not AA’s.

AA can’t do it on behalf of the DAO. While AA can do treasury diversification operations to support the development of the project if not pre-announced and at open market (and has done in the past), doing such a movement now when we should be moving the funds to the DAO is not aligned with what we intend to achieve (which is to transition the treasury towards the DAO).

As soon as the funds are in the DAO, the DAO it’s sovereign to decide what to do with those funds (including treasury diversification!). Please note that the Aragon DAO has a system for checks and balances (Guardians), which have the obligation to veto proposals that may result in ANT being considered a security. For this reasons, I believe it’s super important to already engage in this conversation on what are the constraints that should be considered when making a treasury diversification proposal in the DAO. AA will continue with its plan towards decentralizing the treasury, and next week I’ll provide an updated roadmap with clear times and expectations, so that this type of proposals can take that into account.

Constraint 2

Funds must be used towards the advancement of the project.

The ANT purchase could be done programatically using YFI’s buyback smart contracts (or similar). It would be fairly straightforward to implement a smart contract that received the bought ANT programatically, and distributed it across stakeholders who provide value to the project: governance work (wANT or veANT holders if that was to be changed), LPs providing liquidity to ANT pairs in DEXs, DAOs bringing TVL and usage to the App and aragonOSx, Plugin Developers… It would be up for token holders to decide on the specific allocation to distribute across differents actors / pools. So, instead of a simple “buyback”, this would be more of a “Buy-And-Make” (copied from Joel Monegro’s post on the model here. @juareth wonder if a Smart Balancer Pool would make sense here.

This would help mitigate the underlying problem and increase ANT ownership across those parties who provide work and value towards the project. Therefore, the used funds would be deployed in alignment with the purpose of the project.

Constraint 3

It must be done over an extended period of time (months)

Time-limited but extended in time. This is important, so that it becomes clear that the operation is not intended to provide a quick profit to certain actors, but part of a broader initiative that helps push the project forward.

I hope this sparks a constructive conversation across token holders that can lead to a solid proposal that can gather enough support in Aragon DAO.


Im still quite lost on this 40m numbers. Can you link me to recent transparency reports? Grant information? I have scoured and have found little to no information and question where this 40m number came from. More clarity would be needed here

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Thanks for the proposal Alex.

I was initially leaning more toward ragequit, but because of your proposal a few points clicked and made me realized buyback > ragequit. You already make some of these points in your proposal, but just posting a rewording of them in case it’s helpful for someone else:

  • If you can keep a floor, ANT holders are not incentivized to sell because they are exposed to upside and not downside. Because of that, it can indeed end up being cheaper than it seems.
  • Ragequit will depend on other factors like whether it’s time-limited, or whether the principal will get invested, making it harder to ragequit. It is less predictable for ANT holders, thus makes it harder to set a floor.
  • The bought back ANT can be burned, further helping cement a floor.

Just something to add that I found hard to understand at first:

-Book Value rises with every $ANT bought back below book value and burnt.

But that increase is balanced by a decrease in the treasury, right? Sorry if I’m missing something obvious.

Not quite, because it was bought back below book value, the difference between book value and the price at the time of purchase is then gained by the treasury / BV.

Example 1 - Buyback at Book Value

  • Book Value = $1
  • Buyback Price = $1
  • Difference between BV & Price = $0
  • Token is burnt, there is 1 less supply
  • BV stays the same.

Example 2 - Buyback below Book Value

  • Book Value = $1
  • Buyback Price = $0.60
  • Difference between BV & Price= $0.40
  • The token is burnt, so there is 1 less supply
  • BV increases, that $0.40 is now shared between remaining supply’s BV

I am stoked to see these discussions taking actual shape.

As I outlined in Exit and Voice having an exit mechanism is an important first step. As discussion is starting to get focused we can push further structure around it maybe in a new thread:

  • rage quit vs buyback - sentiment here feels more on the buyback side but maybe a signalling vote as the forum is very easily Sybil-ed (a Snapshot temperature check can be a shortcut)

  • Exit tax as proposed by @alex-arca (at 5%) with the implication well articulated by @ant_holder (I personally think the 40% example is a bit rich, but will assume this is just to illustrate a point)

  • What to do with the ANT that’s bought back - I personally love the idea of @luis to just burn it as it is the cleanest path

Calculating the BV per ANT is going to be probably the most contentious part. I think it deserves a thread in its own, where we hash out:

  • Getting a more complete picture of the current assets and liabilities of the treasury
  • Getting a more specific insight into the $40M Swiss tax provision - its a massive chunk that needs to be explored in more details
  • Are there illiquid assets and what to do with those
  • The ANT supply - I personally disagree with @alex-arca calculation. Removing the ANT held by AA from the supply makes sense in dissolution. As Alex himself points out - this is not a dissolution. Attributing 0 BV to the future token holders compromise the purpose of these ANT reserves as an incentive mechanism. Moreover insisting that is the case can push AA to rush in distributing those prematurely before an adequate mapping of which stakeholders should be incentivised, just to be able to preserve the value of the incentives.[Making a point around the contentiosness of the topic. Ideally would want to have this discussion in a separate thread]

I firmly believe that giving the discussions more structure will help us move faster in shaping up actual proposals that can go up for voting.

How shall we proceed with the discussions?

  • Keep going as is
  • Two new focused threads - one on exit (RQ vs BuyBack + parameters) and one on BV per ANT

0 voters

If we go for the new threads I will set those up and link all relevant existing ones, or someone else can volunteer, just flag it so we don’t end up with forked threads again

P.S. giving 24 hours for voting

I think the treasury should be transferred to the dao first before the dao makes any decisions.

Thanks for sharing your perspective. Just to make sure I understand your recommended course of action.

  • Do we just chill around until AA transfers the treasury and only then start discussing a potential exit mechanism and/or lock-weighted voting?
  • Do you see something else productive and proactive you want to spearhead and coordinate around in the meantime?

Apologies if I am missing the point of your statement

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Thank you for the response ser, I’m fond of your frankness towards both sides.

I should have elaborated:

We should do whatever results in the AA transferring the most value to the dao. If that means not binding ourselves into some outcome that causes them to assess taxes / risk differently, then yes sit on our hands (assuming they will transfer the treasury relatively immediately)

Preferably they would just transfer the treasury and no longer be responsible for it’s use. Then the dao decides what it wants.

Greetings from TempleDAO. We are believers in Aragon’s mission and are excited to witness these invigorating community discussions around how to create sustainable value for token holders and Aragon partners.

We note that buybacks have been proposed in this discussion as a way to reduce the imbalance between returning value to token holders in the present while building for the future. We also acknowledge the legal uncertainty around buyback implementation as a way to return value.

TempleDAO experienced a similar schism last year over the best way to grow and manage our community Treasury. Arising as a technical response to these passionate debates, Temple developed a novel liquidity management contract that could prove useful to Aragon under the current circumstances–RAMOS (Randomized Automated Market Operations Service).

What is RAMOS?

RAMOS is a set of on-chain contracts that provides liquidity and price stability within a normal 50:50 pool on a DEX such as Balancer through automated market operations (AMO). In short, RAMOS will single-side withdraw the base token (potentially ANT in this case) when the token price in the pool falls below a target price threshold to restore the price back to the nominal range. The second token can be DAI, WETH, or whatever the DAO decides should be paired with ANT. The operating parameters of RAMOS can be changed through a governance vote. Alternatively, the parameters can be immutable. The RAMOS contract calls are automated via OZ Defender or another automation framework.

Why is RAMOS better?

By using RAMOS, the Aragon Treasury can ensure that there are no idle funds sitting in a redemption or bonding contract. Funds deployed to RAMOS are always collecting swap fees as well as farming gauge rewards where applicable.

RAMOS is fully-audited, highly scalable, and robust. It has managed a 8-figure TEMPLE::DAI liquidity pool on Balancer for almost half a year without any issues. It has robust randomization features that mitigates arb attacks from bots in the same pool. The price target can be set and applied stochastically with a single RebalanceUp operation.

How does RAMOS Return Value to ANT Holders?

RAMOS does not directly buy back ANT tokens from holders. It is a Balancer LP farmer like any other except that it follows certain liquidity provision guidelines set in advance by the DAO. There is no central authority that decides how much TVL RAMOS should control at any given time, nor the timing or frequency at which transactions will occur. RAMOS operates and maintains ANT liquidity continuously in a way that is flexible enough for no-touch day-to-day operations for an extended period from days to years, yet amenable to updates to any of its operating parameters with no need to redeploy.


RAMOS is a novel liquidity provisioning tool that can accommodate any price floor target and market liquidity depth policies without direct buybacks. It does not suffer from the adverse impact of arbitrage and idle funds. We believe that RAMOS can help Aragon find and reach an equilibrium with its token holders like it did for the Temple community, and we stand ready to help with implementation.

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Thanks for reaching out @Lux.Temple, is it essentially a smart balancer pool?

What fee does Temple take for the use of the protocol, also what level of assets have run through the smart contracts so far.

Look forward to learning more about Temple.

Hello ser thank you for your questions! We recently redeployed RAMOS in April due to changing the paired token from bb-a-USD to DAI. In the past 30 days approximately $2.2M in volume has passed through the TEMPLE::DAI pool. Similarly, when TEMPLE was paired against bb-a-USD, the total volume for a 3-month period from December to March was approximately $6.2M.



RAMOS was built by Temple so we are not charging a fee for our internal use. Temple would be happy to discuss the fee structure and provide technical documentation in a TG or Discord group DM (my contact info is below), but I can say that we are highly motivated to see RAMOS adoption by Aragon. We are ready to share technical documents and the Github repo.

TG: @luxaverse
Discord: lux.temple#0654

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Thanks to everyone who voted! Creating the two threads to hopefully facilitate a more structured dialogue

Exit options here:

Treasury size and book value here:

Hey all, Just wanted to flag that your calculations are off here @alex-arca you need to use the total supply as these tokens do exist, they are ANJ that can be able to convert to ANT at any point.

Moves the BV in your calculation down to 4.43

Thought this would be helpful for other discussions.

I am using the max supply from Etherscan. I am also subtracting out the ANT owned by treasury from both-sides. If there is more supply than the 43,166,684.99587610… please let me know.

Additionally @dcfgod mentioned that it is worth discussing and agreeing upon a method for calculation the calculation. I am using the method that is typically used in a dissolution since i think that should be the hurdle and what has been typically used in the past. If there are any concerns about that or other methods to use, we should discuss here.


IMO this calc should be the absolute lowest number as it completely ignores all ANT enterprise value

Also curious what people think of closing the window to transition from ANT1 → ANT2?

@AClay if we want to consider all ANT supply as “with claim” then we should also change contributor salaries to 100% ANT and preserve the eth/stables/btc because there’s no other use for that ANT

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