✅ Master Treasury Management

Understand allocation strategies, diversification, and spending governance

Allocate DAO funds across competing priorities

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Introduction

Allocation Strategies

Diversification

Spending Governance

Key Takeaways

🎯 Key Takeaways

💡 What You've Learned

📊

Treasury composition is existential: 90%+ native token concentration means token price = treasury survival. When token drops 80%, treasury craters. Runway shrinks from years to months. Concentration risk killed dozens of DAOs in 2022.

⚖️

No perfect allocation strategy: Aggressive (70%+ native) captures bull market upside but dies in bears. Conservative (20% native) survives crashes but misses gains. Context matters: bull markets favor aggressive, bear markets demand conservative. Smart DAOs rebalance proactively.

🔄

Diversification timing is critical: Diversify BEFORE crises (during strength, high liquidity, community support), not DURING (panic, thin liquidity, massive slippage). Use OTC sales, token streaming, and gradual on-chain swaps to minimize market impact.

🛡️

Spending governance balances trade-offs: Multi-sig = fast but centralized. On-chain voting = decentralized but slow. Hybrid models win: on-chain for strategy, committees for tactics, multi-sig for execution. Always maintain 20-30% emergency reserves.

💰

Revenue beats runway: Pure burn (spending without income) = inevitable death. Sustainable DAOs generate revenue: protocol fees, treasury yield, grants, ecosystem value capture. Revenue + diversification + controlled spending = multi-decade survival.

🏆 The Real Lesson from 2022

When markets crashed in 2022, treasury management separated surviving DAOs from dead ones. DAOs with 90%+ native tokens, no revenue, and $5M/month burn rates faced extinction. Some made emergency cuts (layoffs, program shutdowns). Others had already diversified and survived comfortably.

The winners? DAOs that treated treasuries like risk-managed portfolios, not passive token holdings. They diversified gradually (1-2% per quarter during bull runs). They built revenue models (protocol fees, yield). They maintained emergency reserves (20-30% untouchable). They governed spending with multi-sig + committees + on-chain accountability. Treasury management isn't just finance—it's survival.

📝 Knowledge Check

Test your understanding with 5 questions. You need 3 correct answers to pass.

1. A DAO has a $50M treasury (90% native token), burns $2M/month, and earns $0 revenue. The token crashes 70%. What happens?

2. When is the aggressive allocation strategy (70%+ native token) most appropriate?

3. What's the PRIMARY reason DAOs should diversify BEFORE crises, not during?

4. A DAO has $100M treasury and wants sustainable operations. What's the recommended emergency reserve percentage?

5. Most successful DAOs use which treasury governance model?

← Spending Governance