Acala Community DAO for ACA Staking, grow the Treasury and more

Introducing the Acala community DAO - AquaDAO

What is AquaDAO

AquaDAO is a decentralized autonomous Treasury Reserve protocol that aims to build wealth with more transparency and sovereignty.

AquaDAO leverages and grows the Acala Treasury with a policy-controlled Reserve and a portfolio of assets. The purposes of the AquaDAO token aDAO are to incentivize Network-Owned-Value through acquisition of tokens with value, yield and utility such as liquidity, and give ACA holders access to its growth.

You can participate by staking and subscribing to AquaDAO.

Why AquaDAO

Acala Treasury first published the idea to enable Acala Network to own a portfolio of crypto assets that has value, yield and utility. Its first practical implementation is to own DOTs that allows Acala to gain continuous access to Polkadot’s billion dollar network security through Parachain auctions. And subsequently upon launch, DOTs can be deployed to Acala’s Liquid Staking Protocol to earn yield and used as liquidity to bootstrap other protocols.

The Acala Treasury to-date has acquired substantial amount of DOT on-chain. This design feature also supports Acala token ACA with a fixed supply model.

AquaDAO is hence a community DAO for ACA, creating protocol-controlled policies to grow the Acala Treasury and provide ACA holders access to the growth via staking. The aDAO token is a representative share of the baskets of assets owned by the AquaDAO Reserve with direct access to its yields and growth, and has a hard backing of a basket of stable and crypto assets.

This has a few benefits

  • It aligns Acala Treasury growth with ACA holders creating a self-optimized system
  • Further emission of aDAO will increase the Reserve’s network-owned value and liquidity to achieve critical mass
  • In turn the aDAO stakers will get a share of this growth

In the future, AquaDAO will also empower more users to participate in governance through delegated and vested voting with pooled Reserve-controlled tokens for Acala, Polkadot and beyond.

AquaDAO may also inspire a new model for Treasury funding to achieve long term incentive alignment from varied parties. With the excessive Reserve, AquaDAO can then add strategies to fund Parachain crowdloans, and expand growth asset portfolio, where aDAO holders can vest vote to participate.

How to Participate in AquaDAO

  1. Stake ACA in return for aDAO yield powered by Acala Treasury’s staking yield
  2. Subscribe to AquaDAO by contributing accepted assets such as aUSD, LCDOT, DOT, LP tokens
  3. Stake aDAO in return for aDAO yield

Credits

Acala team for the Acala Treasury concept and design, as well as the inspiration of a Sovereign Wealth Fund for a decentralized network.

OlympusDAO for the Nash equilibrium implementation on chain.

ve(3,3) vested staking design from Andre Cronje.

Proposal
AquaDAO will propose to Acala Treasury to seed the Reserve in return for a percentage allocation of aDAO’s total supply as long term vested share of AquaDAO.

ACA holders can access the AquaDAO growth and yield via the Acala Treasury portion of the aDAO staking yield. Acala Treasury can also determine reward distribution policy to include additional staking assets e.g. aUSD.

AquaDAO token aDAO has a hard reserve backing (HRB) of (X aUSD + Y DOT). The DOT portion can also be LCDOT (Liquid Crowdloan DOT) which has a 1:1 hard backing of (aka. redeemable to) DOT. Once ACA is bootstrapped, it can also be a candidate for the HRB basket of assets. AuqaDAO will also be working with other networks and projects to expand the HRB basket.

Read more here

If you’d like this idea of ACA staking and grow the Acala Treasury, and want AquaDAO to be built, please signal with a like :slightly_smiling_face:

87 Likes

My thoughts:

Pros.

  • Branding: I absolutely love the name. Please never name any of our products after food…

  • Community: People are going to LOVE the idea of staking their ACA for yield.

  • I am deadfast on not changing the tokenenomics, this seems to both offer staking plus a fixed supply. I’m bullish on this feature.

  • I personally like the idea of Acala doing its best to buy up as many yield generating assets as possible. We also can try to own our own liquidity / promote LPs that people don’t like to provide by owning them ourselves.

  • Long term, we can use the funds to either get the next parachain slot / buyout another project ( I think trying to buy a smaller project so we control them out down the line would be a cool idea ) think Facebook buying Instagram.

  • Anything that increases engagement in the community is a good idea. and I do think this will work well at that.

  • This also gives more value to ‘voting’ which I think is something we need to do better to promote.

Cons:

  • I’m quite involved in OHM, and even for me someone who uses these protocols very regularly it can be confusing and takes time to learn the details.

As we learned so far it can be hard to get users to actually read the FAQs let alone understand what they are signing up for. Meaning this product is going to take ALOT of explaining / hand-holding to get rolled out.
It’s also going to need its own thread in the discord of course.

  • The (3,3) model, I’m sure most people here understand what this means, basically no one is incentivized to sell, therefore price appreciation. BUT let’s not kid ourselves and pretend this is a tried and tested thesis. In my experience, when it goes well it goes really well. Went it goes poorly, it goes very poorly.
    ^ somewhere down the line, someone is going to eat a BIG L on this product and we need to beware that we could be walking some crypto-noobs down a confusing unprofitable path ( I’m not saying the product won’t work, I just think we need to look before we leap )

Lastly, I’m very impressed, love the team, love this idea, and would like to be involved as much as possible to get this off the ground + make it a roaring success!

I am available 24/7 regarding this new product/feature let me know via discord if I can do anything to help. Happy to commit my time.
:watermelon:

27 Likes

I like the idea of introducing ACA staking without changing the tokenomics. Users like the ability to participate in a network/project and earn passive income. It’s something that they’ve come to expect with every token they hold. When it comes to ACA, a lot of people have asked “what can I do with it?” So I think giving more utility to the ACA token and ACA token holders is a good thing.

7 Likes

Great initiative. Innovative solutions from other chains adoped in our conditions is what we need.

2 Likes

Wow this is a GREAT IDEA :bulb: Finally a bombshell Idea… we’re all going to be literally millionaires with this one.

4 Likes

a good initiative to offer alternatives for ACA token holders. The best blockchain will leverage other open-sourced projects and merge into one unified platform for all users!

1 Like

Hi all - huge fan of Acala and the team. I was just curious about why we aren’t planning to just use the ACA token for DAO governance and decided to set up a separate AquaDAO token for ACA network governance? Will ACA then not provide voting / governance / revenue sharing rights? Or am I missing something and AquaDAO only provides governance for part of the Acala platform (the treasury)? Thank you!

Thanks for community call, was really nice information & now it’s more clear.
Staking ACA is amazing idea, when people know all the benefits from this, they will love it for sure.

Keep rocking Acala team! :rocket:

1 Like

It wouldn’t make a lot of sense for ACA to be the governing token for a DAO that not all ACA holders are participants in.

2 Likes

I was hoping something like this would appear on a parachain, and I’m glad that it’s surfacing on Acala.

I think the OHM model has worked very well (if you understand its goals), and even if you don’t like the OHM token itself the community is powerful. The treasury is huge. The ve(3,3) variant needs (IMO) other DeFi legos to appear on Polkadot before it could meaningfully work. I’m confident that this will happen naturally over time. I look forward to being a day-1 participant.

2 Likes

I see, yes that makes sense - I think what would be helpful for me to understand would be to understand exactly what the relationship is between AquaDAO and Acala Network is, and where one begins and the other ends

1 Like

Great response, I’m just now looking into OHM and trying to understand their model. Wish I would have looked into it deeper when Chico first mentioned it… But very thankful Acala will be implementing it. I’m guessing Chico will be making a video on this soon as well. Anyways great post my friend.

Sounds to me a new token, and no product is working yet. Defi hub of dotsama is more or less moonbeam today. The product is far from functionnal. We can’t use the chain to have anytoken we want, like uniswap or so.

I know team has been working hard on XC-20. But the testnet that is working today doesn’t represent the today product. 1 year after presentation of the testnet said to be fully functionnal after the parachains.

There is no bridge working with btc/eth or any other chain.

The thing that is working great is liquid stacking. Swaping to me is not working until anybody can add anytoken he wants.
Stable coin is not stable.

Introducing new products and more complexity to something that is not working properly today, to me the team is wrong to start too much things at the same time, and not finishing a single one.

Bitcoin is very simple. There is no more than 21millions. Huge success.
Keep it simple please.

That’s why I don’t support the new proposed DAO.

4 Likes

Wow, thanks for the comments, likes and questions.

AquaDAO will be a Dapp build on the Acala network. It can use native, DOT cross-chain assets, and later assets from different consensus networks. It will leverage the primitives on Acala like DOT-native stablecoin lending and DeX, and aDAO token will also be available as ERC20 in Acala’s EVM+ seamlessly without new standards.

Also put out a bit more details on AquaDAO for those who want to dig deeper and might be interested in building together here.

Acala is like Terra + EVM on steroid :rocket: let’s build~

2 Likes

Terra don’t need usdt usdc to be top 2 TVL. Acala maybe the second after Terra.

This is the hidden gem i have been looking for, now let the advertising begin and get the degens involved…

Could we establish a similar DAO for karura community?

Looks good especially LCDOT is consider to be in full DOT value when bootstrapping to HRB basket if I understand it correctly. So in a way, it really give investor an opportunity to put their LCDOT to good use rather than sell them off to unreasonable discount.

I agree. This proposal looks great.

Totally agree with this proposal, long term vision.