Summary
Building upon the foundations laid by previous initiatives like the Treasury Management Proposal and the proposal to Add XVS and BNB from Treasury to XVS/BNB Liquidity Pools, this proposal seeks to further optimize Venus Protocol Treasury management.
The core of this proposal is the deployment of dedicated TreasuryTokenConverter contracts on BNB Chain, Ethereum, and Arbitrum. This text will be hidden
Optimizing the Treasury: Systematically converting the Treasury’s diverse altcoin holdings into a core portfolio of strategic assets: USDT, USDC, BTC, ETH, BNB, and XVS.
This initiative would initially focus on BNB Chain, Ethereum, and Arbitrum, where approximately $1.7M in Treasury assets can be optimized.
Background
The Venus Treasury currently accrues income from two main sources:
- A percentage of the interest paid by borrowers.
- A share of liquidation incentives.
While the Automatic Income Allocation system efficiently directs these funds, many of the assets received are held passively without generating yield or serving a strategic purpose.
The existing Token Converter infrastructure has already proven effective for targeted conversions. This proposal recommends creating specialized TreasuryTokenConverters to apply this mechanism directly to the treasury itself, transforming it from a passive holding structure into an active, revenue-generating engine.
Proposal Details
Asset Optimization & Conversion
- Deploy TreasuryTokenConverters: New, specialized SingleTokenConverter contracts will be deployed on BNB Chain, Ethereum, and Arbitrum. Their sole purpose will be to facilitate the conversion of all non-strategic altcoins held in the Treasury.
- Strategic Accumulation: The target accumulation assets will be USDT, USDC, BTC, ETH, BNB, and XVS, aligning the Treasury’s reserves with the core assets of the Venus ecosystem and the broader DeFi landscape.
- Community-Driven Conversions: The TreasuryTokenConverter will offer small, configurable incentives for each swap. This creates arbitrage opportunities that encourage community members to perform the conversions, following the proven model of existing Venus converters.
Benefits
- Treasury Growth: By actively managing non-core assets, the Treasury’s value can grow organically over time, providing a stronger financial foundation for the protocol.
- Strategic XVS Reserve Accumulation: A portion of all optimized conversions will be allocated toward increasing the Treasury’s XVS reserves. This ensures the protocol maintains the flexibility to support governance initiatives, incentivization programs, strategic partnerships, and liquidity provisions without impacting circulating supply or requiring new emissions.
- Community Engagement: The incentivized converter model leverages community participation for decentralized and efficient asset management, turning passive treasury holdings into actively managed strategic reserves.
Conclusion
This proposal outlines a clear, actionable strategy to evolve Venus Treasury Management. By deploying specialized TreasuryTokenConverters, we can:
- Convert idle or non-strategic assets into core reserves.
- Grow and strengthen the Treasury over time.
- Build a sustainable XVS reserve for future strategic needs.
This is a crucial step to ensure Venus remains a competitive, financially robust, and community-driven leader in DeFi.