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ENS DAO votes to sell $16.5 million of ETH for USDC via CoW Swap

Quick Take

  • ENS DAO delegates have voted in support of a plan to sell 10,000 ETH from the project’s treasury.
  • The funds will be used to support ENS Labs and the DAO’s core working groups among other needs.

Ethereum Name Service (ENS) DAO delegates have voted to sell 10,000 ether ($16.5 million) from the DAO’s treasury to fund the project’s activities for the next 18 to 24 months.

The vote ended with 89% of all participants in favor of the plan, according to figures from Tally. Major ENS personalities who supported the vote include founder Nick Johnson and ENS Foundation chair Brantly Millegan.

The ENS DAO will now proceed to sell 10,000 ETH in exchange for USDC. These funds will come from the project’s spendable treasury, which is denominated fully in ether. By selling 10,000 ETH, the proposal aims to reduce the DAO’s exposure to ether.

This trade will take place via CoW Swap. The DAO hopes to earn at least $13 million from the sale, increasing the DAO’s USDC balance to above $15 million.

There was some debate over how the tokens should be sold. The proposal stated a single swap of the 10,000 ETH tokens for USDC. Some USDC delegates argued in favor of breaking down the sale into smaller units. They also suggested that the DAO should employ a dollar-cost averaging technique to get the best value out of the sale.

Ultimately, the DAO has gone for a single swap strategy. The reason for this is that a phased sale process would have required delegates to vote for each stage, said Johnson on the DAO forum.

The bulk of the funds raised will go toward covering the daily expenses incurred by ENS Labs. The Singapore-based ENS project developer receives a daily stream to the tune of $11,500 USDC from the DAO. Over two years, this spending bill will reach $8.4 million.

The funds raised will also be used to support the DAO’s core working groups, of which ENS DAO has three. The budget proposed could see these working groups claim as much as $6 million in the next two years.