FORTH DAO - Treasury Diversification

Ampleforth Governance
1

Category: Treasury

Authors: Guzman_MassAdoption, @Nestor, @zacharias

Date: July 17th, 2025

Summary

This proposal establishes a framework for diversifying the FORTH DAO’s idle USDC reserves into yield-generating strategies that prioritize capital preservation, protocol sustainability, and long-term revenue generation for the DAO. Specifically, it recommends exploring the deployment of $2,572,850.29 USDC from the treasury into risk-adjusted, high-yielding DeFi-native markets to earn passive yield and strengthen the DAO’s financial runway.

The strategies proposed herein are designed to offer competitive, risk-aware returns while persevering full custody of funds within the DAO’s wallet - meaning assets are deposited directly into the approved strategies without relinquishing control to a third part or external manager(s).

This proposal seeks to ensure that idle treasury capital is deployed responsibly in support of Ampleforth’s long-term mission, while providing the DAO with enhanced optionality for future growth initiatives, token buybacks, or other community-driven programs.

Context & Rationale

The FORTH DAO treasury currently holds a significant balance of idle USDC. While these reserves offer flexibility and optionality, they also represent untapped potential in the current DeFI landscape - particularly at a time when protocol-driven sustainability and financial autonomy are top priorities across the ecosystem.

By deploying a portion of these idle reserves into vetted, onchain yield strategies, the DAO can:

  1. Convert idle capital into productive assets
  2. Extend its financial runway and operational capacity
  3. Fund Future Initiatives
  4. Reduce dependence on token sales for funding
  5. Explore buybacks or SPOT minting using realized yield

Proposed Reserve Strategy

Strategy Criteria

Each candidate strategy must meet the following minimum requirements:

  1. Non-custodial: DAO retains full control of funds
  2. Transparent: Protocol and yield mechanics are auditable and verifiable
  3. Sustainable yield: Returns must be based on actual borrowing/lending activity or verifiable strategy outputs

Strategy Options (as of time of writing)

Strategy Platform Current APY (%) Projected Quarterly Return on $2.57M Projected Annual Return on $2.57M
Aave v3 - USDC Aave 3.83% $24,652.05 $98,608.18
Compound v3 - USDC Compound 6.56% $42,204.01 $168,816.04
Gauntlet USDC Core Morpho 7.01% $45,092.48 $180,369.91
Gauntlet USDC Frontier Morpho 7.68% $49,414.45 $197,657.80

Note: APYs are approximate and may fluctuate with market conditions. Final Allocations are subject to DAO approval at the time of execution.

Oversight & Reporting

The Amplifier Program will be responsible for producing and publishing quarterly transparency reports detailing the performance and status of the Treasury Reserve deployment. These reports will serve as an accountability mechanism and provide clear visibility into the DAO’s capital efficiency efforts.

Each report will include:

  1. Currently deployed strategy and platform(s)
  2. Total accrued yield since initial deployment
  3. Updates on the underlying yield strategy that may affect the DAO’s position
  4. Updated forward projections based on APY/APR trends

Governance options & Rebalancing

This pilot Treasury Reserve program will run for one quarter (three consecutive months). At the conclusion of the quarter, the DAO will evaluate the performance of the selected strategy and the overall positioning of the Treasury Reserve.

A follow-up governance proposal will be submitted to the DAO, enabling tokenholders to vote on one of the following options:

  1. Maintain: Continue with the current yield strategy
  2. Divest & Migrate - reallocate funds to a more attractive, risk-adjusted strategy
  3. Buyback - use a portion of earned yield to buyback FORTH or mint SPOT
  4. Divest to Treasury - Exit the yield strategy entirely and return funds as idle USDC.

At the time of submission, the follow-up proposal will include updated context on current and prospective strategies, including yield metrics and projected returns. This ensures DAO participants have access to the information necessary to make fully informed, transparent decisions or to at least stimulate productive discourse.

Closing Thoughts

All macro trends in DeFi and the broader crypto-economy are pointing towards a near & long-term future where protocols and their native & reserve assets are best positioned to thrive through sustainable, yield-generating strategies. As risk-adjusted opportunities mature, protocols that adopt responsible capital deployment frameworks will have a distinct advantage - both in terms of treasury longevity and tokenholder alignment.

This proposal offers a thoughtful, DAO-driven approach to activating idle treasury assets in service of FORTH DAO’s long-term sustainability, including the broader Ampleforth ecosystem.

1 Like
2

Big advocate for re-activing the DAO’s otherwise idle funds but through a low-risk, diversified yield strategy. Particularly would like to take advantage of the Gauntlet APYs being offered.

Open to suggestions and adjustments. Thanks all.

3

As a top priority, I personally would like to see the idle USDC used for ampUSD, because it would kill two birds with one stone. It will support a stablecoin backed by Ampl (and soon Spot) while also putting idle assets to work. I think we all know the Ampl/Fragments eco can use all the help it can get at this point.

4

This is a valid argument - however given the consistent delays behind ampUSD why not have the USDC earn yield in the meantime? If the idea is to bolster Asymmetry’s ampUSD, why not use AMPL as that collateral while the DAO simultaneously utilizes the idle USDC to begin revenue generation.

I see a world where both are possible

5

I guess if the logistics support deploying assets in one place, and then redeploying in another place in a timely manner it makes sense.

It seems like a lot of overhead though to start this up, and lets say ampUSD launches mid August, then we need another proposal to unwind everything and restake it in ampUSD. Basically it’ll be two forth signals and votes spanning several weeks, when it could be just one for ampUSD

6

I am against this proposal. I believe the DAO should be all in on the AmpleForth ecosystem. The purpose of the DAO is to advance AmpleForth and this does not achieve that objective. I recommend minting or buying Spot and holding vs the proposed yield generation. The DAO should be generating yield and protecting from inflation with the products they are advocating for. How can users trust the DAO if they don’t take advantage of their own products and solutions?

7

I have the same stance here as on the proposal to use the USDC for USDaf about a month ago.

Short-term I’m okay with making use of the idle USDC.

Long-term however, I believe it’s better used for something AMPL-native like SPOT-USDC liquidity as it provides the same or higher APY while also boosting all the other aspects of the SPOT & AMPL ecosystem:

1 Like
8

I support allocating the funds to initiatives that directly strengthen the Ampleforth ecosystem/products than depending on anything else.

If we can’t align on such ideas quickly, low risk defi strategies as mentioned in the proposal is still far better than letting it stay idle.

9

To do so will require far more active governance than the DAO currently has. Amplifiers program can step up to cover the extra work involved if voter enthusiasm is there.

10

I wanted to add that adding USDC-SPOT in charm vault could have great yield and supports the AmpleForth ecosystem. I recommend that and/or holding Spot for yield generation.

2 Likes
11

Absolutely agree. From my perspective, leaving DAO funds (in this case, USDC) idle or overly dependent on the successful launch of a partner protocol carries significant opportunity cost. It’s a suboptimal use of capital that could otherwise be generating returns for the DAO today.

In the short term, deploying USDC as proposed aligns well with capital efficiency goals. But long term, the DAO should be strategically allocating capital toward native ecosystem strategies that bootstrap and reinforce the broader protocol - especially those that deepen SPOT utility and liquidity.

Yield earned from near-term USDC deployments could be recycled into minting SPOT. And frankly, the DAO should aim to become one of the largest holders of SPOT in the ecosystem - both as a signal of alignment and to strengthen its role in protocol governance and sustainability.

1 Like
12

That’s a fair concern and I’d argue the proposed strategy can actually serve your goal if executed thoughtfully.

The yield generated from this deployment doesn’t have to sit idle or be externally extracted. It can - and should - be recycled into minting more SPOT, increasing the DAO’s exposure to its own ecosystem assets. Isn’t that a net-positive?

In doing so, the DAO achieves two key objectives:

  1. Generates sustainable revenue, rather than diluting reserves.
  2. Uses that revenue to acquire and support native products like SPOT , reinforcing the very ecosystem it’s meant to grow.

To your point: what better way to demonstrate belief in Ampleforth’s long-term vision than using our own flywheel to bootstrap it?

13

I get the concern around operational overhead. But to be honest, that’s the nature of any capital deployment proposal: they often require iterative steps, adjustments, and follow-ups.

That said, I’d argue the trade-off here is worth it.

Let’s assume Asymmetry launches ampUSD by mid-August. Great we’ve earned some yield in the meantime instead of sitting idle.

But what if the launch slips into late Q4 or even Q1 next year? Then we’re looking at months of lost opportunity:

  1. No yield is generated during that idle time.
  2. No reinvestment of that yield into ecosystem products like SPOT.
  3. And DAO capital just sits, doing nothing.

A short-term yield strategy helps bridge that gap. It doesn’t have to be perfect, just productive - and the DAO can always unwind and reallocate once the right long-term product (like ampUSD) is live and stable.

14

My suggestion is to use the USDC for the charm pool NOW rather than deploy it elsewhere. No need to take the extra step.

15

Overall, this proposal lays a solid foundation for long-term treasury sustainability and capital productivity.

Having read through proposal and comments, @Guz_MassAdoption responses provides a clearer picture.

16

I agree with this stance as well. Why not eat our own dog food? Ampl is barely even in the top 1000. Its a struggling project guys. If the DAO doesnt support Ampl/Spot who else will

I do like the idea of diversification but as a struggling project I think we need to be Ampl first for a while. Invest idle funds in OUR eco. If Ampl was a top 20 project rolling in dough - whatever do with the DAO funds as you please.

We have all this yield Spot is generating right in front of us, laid at our doorstep and we just step
over it

I see the amplifiers and Ampl all over X and spot.cash all adovocating for Spots high lp yield.

And its like no one even believes in it. Are all those posts just bullshit then? Does anyone even believe in Spots yield? Do we believe in the LVA yield? Do we believe in LVAs? Isnt Spot the first LVA? Why not support it? Is all the LVA stuff I see on twitter bullshit too then?

How are we ever going to go anywhere when we dont even believe in our own products?

The apr looks to be high right now, why not ride the momentum?

Ill just leave with this here

Sometimes the biggest treasure in yourr own backyard

18

Reading through this thread, it’s clear there’s a real split: pursue safer, diversified DeFi yield or double down on our native ecosystem. But I don’t think it needs to be one or the other.

We should do both and in doing so, prove a few key things:

  1. That we can manage treasury funds responsibly
  2. That we actually believe in what Ampleforth has built and we’re endorsing
  3. And that the community is capable of deploying capital in ways that others in DeFi might actually want to copy

If another DAO looks at our reserve structure and says “I’d run that,” that’s real credibility—not just yield, but narrative weight.

That’s why I’m in favor of this proposal overall. But I think it’s missing one piece: a small allocation to the SPOT-USDC pool from day one. This lets us start generating native yield immediately and begin backing up the SPOT/LVA narrative with actual usage, not just tweets.

We don’t have to go all in. But showing that native deployment is part of the strategy—not an afterthought—helps build internal trust, proof of concept, and forward momentum. At a minimum, we have real data after three months. Best case, we validate the thesis we’ve been advocating all over X. And in the later case, I would even look to an increasing % strategy towards native allocation to repeat the process of proving protocol centric benefits at the review mark.

2 Likes