Disclosure: I previously worked for Lido. I don’t work on Lido anymore but I am an LDO holder and remain very invested in Lido’s success.
Quick thoughts:
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Extending runway seems sensible given current calculations of runway. Ideally, the DAO should be able to operate comfortable for the next 5 years. Securing runway is high priority so am supportive of this abstractly.
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It would be good if this diversification event was available to everyone, rather than gatekept to VCs. It should be still limited on total size. Maybe theres some KYC stuff that makes this unattractive?
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It doesn’t make much sense to me for there to be no lockup on tokens. I believe there should be a lockup of at least 1 year. If people/funds/entities/VCs would like to buy LDO directly from Lido, at spot, with best-possible execution price (likely 10-20% cheaper than they’d be able to execute otherwise) the minimum commitment should be to supporting Lido for at least one year. Since governance rights are granted while locked, this should be fine for any investor that is long-term minded enough.
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If you try to buy $10m of LDO now OTC, the best execution prices you’ll be given as a buyer is ~$1.85 per LDO (current spot price is $1.55). This means Lido will be selling cheaper than any buyer eg. Dragonfly would meaningfully be able to execute otherwise. However, as a seller, best execution price for $10m is ~$1.25. So, peer-to-peer execution at spot is clearly favourable for both parties.
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Because of the above effective “market” or “slippage” discount (and because crypto VCs basically do absolutely nothing and this is exclusively a financial transaction rather than a “working relationship”) I don’t think a further discount to spot can be justified.
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Since there is no discount to spot beyond slippage discount, any conversation about “do they add value???” or “does cobie think they are top 5???” are a distraction. It’s a financial transaction because Lido needs the runway and investors would like better execution on their entries.
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All the ideas in this thread about “selling 16 LDO a minute on Binance” are totally stupid.
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Finally – the annual runway seems extremely high. I know blockchain people are very expensive – especially good ones – but does seem like some exercise to check whether this runway is the minimum viable runway. What TVL would be needed such that revenue would sustain the DAO alone? Think these questions are worth considering given market conditions and having someone to lead treasury/finance is a good idea.
TLDR: support extending runway, very important for lack of distruption. Think there should be lockups on tokens and no spot discount. Should probably hire a CFO asap.
Thx, C