DIP-6: Amendment 4

Headline: Approving a budget for protocol development and operations in 2024

Author: The DIMO Foundation

Submitter(s): The DIMO Foundation [0xCED3c922200559128930180d3f0bfFd4d9f4F123]

Status: Deployed

Voting URL: Snapshot

Discussion Forum: Discord #🗳️governance forum

Vote Type: Level 1

Abstract

This amendment updates the DIMO Foundation operations and development budget for the calendar year 2024, earmarking up to $4,000,000 USD equivalent. All intellectual property produced for hire must either be owned by the DIMO Foundation, perpetually licensed to the DIMO Foundation, or open sourced. All spending from this budget of any sort must be primarily for the benefit of the DIMO protocol.

Motivation

DIMO is a decentralized protocol that has already connected over 95,000 cars, allowing drivers to use multiple innovative applications built by various developers. This amendment provides the Foundation with the resources to grow the network and make DIMO more robust and accessible.

The DIMO Foundation may compensate contributors for developing: DIMO credits (a way to pay with $DIMO without volatility); account abstraction wallet services for better security, recovery, and user experience; open source node software and device firmware so that other businesses can easily spin up nodes or build compatible devices; an onchain developer license and app marketplace; cryptographic proofs of vehicle legitimacy and movement; improved vehicle decoding so that more vehicles see more data points; and more.

Specification

// If passed, this proposal would edit the following section within the DIP-6 Motivation section:

Motivation

Forming and delegating rights to a legal entity is necessary for DIMO to interact in today's world among business and governments. This proposal aims to maximize transparency and the capabilities of the DIMO protocol while minimizing the liability for participants while preserving transparency.

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// And would make the following changes to the Specification section.

Financial Plan & Ask

Resources

The Foundation currently has 1,127,503.27 $DAI in its Wallets, which is what remains of the 1,250,000 $DAI donated by Digital Infrastructure Inc.

The Foundation is actively working to open up a bank account and would convert some of that $DAI to fiat US dollars.

As of the July 5th 2024, the DIMO Treasury contains $10,276,785.64 in USD and stablecoins, as well as 472,045,031 $DIMO tokens (141,513,446 of which are not yet earmarked for any purpose). Except for the $2,348,070.45 in cash held in a legacy bank account, balances can be found in the DIMO Foundation wallets posted here.

A breakdown of $DIMO token treasury allocations is shown below.

Starting $DIMO treasury & rewards		700,000,000
	Spent	Reserved
Airdrop	41,336,260	0
Baseline (DIP-2)	83,542,040	299,726,463
Loaned (DIP-6)	13,000,000	0
Sold (DIP-6)	57,809,672	0
Operations (DIP-6)	572,119	0
Referrals (DIP-7)	518,400	1,981,600
Grants (DIP-8)	1,176,478	14,823,522
Marketing (DIP-9)	30,000,000	14,000,000
Total	227,954,969	330,531,585
Remaining $DIMO in treasury		472,045,031
Remaining unreserved $DIMO		141,513,446

Budget

The DIMO Foundation anticipates spending approximately $1,800,000 in 2023. $200,000 of that would be on administrative overhead, including directors salaries, legal fees, insurance, KYC services, technology subscriptions, and more. Another $600,000 would be to compensate contributors who build and grow the DIMO protocol. Digital Infrastructure Inc. is under contract to provide services at $150 per hour and is expected to be the largest such contributor. Up to $1,000,000 will be used to increase the availability of $DIMO on exchanges.

To leave some extra buffer for the unexpected, this proposal gives the DIMO Foundation the authority to spend up to 2,000,000 in USD equivalent in 2023 for relevant operations.

The DIMO Foundation is authorized to spend a maximum of $4,000,000 USD equivalent on operations and development in the calendar year 2024. This includes roughly $1,308,729.40 in expenses incurred January through May 2024, but not yet paid. All intellectual property produced for hire must either be owned by the DIMO Foundation, perpetually licensed to the DIMO Foundation, or open sourced. All spending from this budget of any sort must be primarily for the benefit of the DIMO protocol.

Any payments to Digital Infrastructure Inc., a labs entity that originally created the DIMO protocol and continues to contribute to its development, must not exceed a 10% markup on the fully loaded cost of personnel who are actively working on intellectual property for the protocol or open source software that significantly benefits the protocol.

Furthermore, following the expiration of marketing payments to Digital Infrastructure Inc. in DIP-9, the DIMO Foundation may, at its discretion, also pay Digital Infrastructure Inc. for half of the fully loaded cost of any marketing personnel who are primarily promoting the DIMO protocol and the extended ecosystem, and not those promoting Digital Infrastructure Inc. products specifically.

This budget pool is distinct from those authorized in other DIPs such as Baseline Issuance, Grants, Marketing, and Referrals. The DIMO Foundation is responsible for coordinating with all subdaos to ensure that no third party is paid twice for the same work.

Treasury Initiatives

This proposal authorizes the DIMO Foundation to loan up to 40,000,000 $DIMO tokens to market makers. As of the date this DIP was last amended, a total of 30,500,000 $DIMO have been loaned to market makers, of which 17,500,000 was purchased for 5,922,025 USDT and 13,000,000 remains outstanding.

Additionally, for a period of 120 days following the passage of this proposal, the DIMO Foundation is authorized to sell up to 48,000,000 $DIMO to Digital Infrastructure Inc. for $0.11 per token for a total sum of up to $5,280,000 USD. These tokens would be subject to a mutually agreeable lockup. The purpose of this sale is to diversify the DIMO treasury and provide resources for long-term development.

The DIMO Foundation has already sold 833,333.33 $DIMO tokens at $0.30 in accordance with the original language of this governance proposal.

The Foundation will make its best effort to balance regulatory, financial, and strategic considerations to maximize the long-term health of the DIMO protocol. These tokens would come from the unallocated treasury pool of 250,000,000 $DIMO.

Per the original DIP-6 and subsequent amendments, the DIMO Foundation has sold a total of 57,809,672 $DIMO from the treasury including the amount purchased from market makers.

Additionally, this DIP authorizes the DIMO Foundation to move up to 70% of its cash and stable token reserve to Superstate.co to earn interest on non-$DIMO assets; as well as change $DIMO into cash or stable tokens for subdaos such as those formed in DIP-8 and DIP-9 should those teams need to pay an expense or issue a grant to a vendor that doesn't accept $DIMO.

Implementation

If passed, DIP-6 would be updated as specified above after the four day timelock concludes.

Copyright

Copyright and related rights waived via CC0

Citation

Please cite this document as:

The DIMO Foundation, "DIP-6: Amendment 4", June 2024. [Online serial]. Available: [https://github.com/DIMO-Network/DIP]

Changelog

Disclaimer

The contract addresses for $DIMO are 0x5fab9761d60419c9eeebe3915a8fa1ed7e8d2e1b on Ethereum and 0xE261D618a959aFfFd53168Cd07D12E37B26761db on Polygon. Please always confirm that you are interacting with these contract addresses and not those of a fraudulent imitator. This proposal may not be enacted if it violates Cayman Islands law. Please triple check that any communications are authentic as it’s common for scammers to try to trick you into sending them crypto or into revealing your private keys.

Certain statements in this document constitute forward-looking statements. The words “may,” “will,” “should,” “project,” “anticipate,” “believe,” “estimate,” “intend,” “expect,” “continue,” and similar expressions or the negatives thereof are generally intended to identify forward-looking statements. Such forward-looking statements, including the intended actions and performance objectives, involve known and unknown risks, uncertainties, and other important factors that could cause the actual results, performance, or achievements to differ materially from any future results, performance, or achievements expressed or implied by such forward-looking statements. There can be no assurance that such statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and nothing in this document represents a promise of specific work to be completed in the future.