Report on Activities for the Future

Dear Capital DAO Protocol Community, as previously announced, this article will provide an update on our recent activities.

Our goal is to share the status of our Treasury and investments to maintain transparency.

Treasury Status

The Treasury is a crucial funding source for Capital DAO’s activities. Since our last report was in February of the previous year, we will provide an updated summary. The Treasury is managed on-chain via Multisig, so anyone can verify transactions.

[embed]GnosisSafeProxy | Address 0x3f3210e26ba140af501f50403e9b02d9e62af543 | Etherscan The Contract Address 0x3f3210e26ba140af501f50403e9b02d9e62af543 page allows users to view the source code…etherscan.io

Brief Summary

1. February to July 2022: Provided liquidity in USDC to Balancer, engaging in farming and liquidity mining.
2. February to May 2022: Conducted farming with USDC-UST on Uniswap v3. We were affected by the Terra shock but suffered minimal losses.
3. March 2023: Approximately $2M in USDC was affected by the USDC depeg. To mitigate risk, we swapped into USDT, resulting in a loss of about 5.5%. We also purchased ETH at this time.
4. June 2024: Deposit cbETH and wBETH to Symbiotic in a new account(DeFi Wallet)
5. June 2024: Deposit stETH to AO in DeFi Wallet
6. We currently have unrealized gains/losses on our ETH holdings.
7. Since November 2022: Made 29 investments totaling $2,480,205

1. Providing Liquidity to Balancer (February to July 2022)

To prevent having our Treasury funds sit idle while we prepared to start investing, we decided to generate some interest income through DeFi. We provided $1.5M in USDC to Balancer’s Stablecoin pool, which allowed us to earn interest with low risk. By selling $BAL, we generated $20,408.74 in proceeds, and we earned $3,506.87 in LP fees (including slippage from deposits and withdrawals). This resulted in an APR of approximately 3.8%.

1. Liquidity Provision: https://etherscan.io/tx/0xb0ce7131618cc95ab7eac3f8a0a4d3b57bed5fa2aec59124233624113830a426
2. BAL Claims: https://etherscan.io/tx/0x9a90d26f0f05994898a63671a3b85ca486c230dbe5377a3534e0e552d2196a80 https://etherscan.io/tx/0x9af38692a97fa8381d45f6adb1bee4d504850ad9a604950cbdf5d3aa7d158e66 https://etherscan.io/tx/0x11b2b57a7181368d7de626c38fac994808f5e40efe03e3a58fdff1f5bc5ee4e6 https://etherscan.io/tx/0xe63a6fed7e87dcf7ea5e320dce35552a7e82077d79ec64f967b69d1fe66a5ea4
3. BAL to USDT Swaps: https://etherscan.io/tx/0x9a90d26f0f05994898a63671a3b85ca486c230dbe5377a3534e0e552d2196a80 https://etherscan.io/tx/0xcae3f312b33725e4a728ce7e389c4814837b18246d82e47e7d91b9d96c0babda
4. Liquidity Withdrawal: https://etherscan.io/tx/0x055bc2d01539048d04484abb49d5f6ba3d7562cb34350da1b344e43d9ddf4f46

2. Providing Liquidity to Uniswap v3 and the Terra Shock (February to May 2022)

Around the same time we were providing liquidity to Balancer, we also decided to provide liquidity on Uniswap v3 using UST, which was rapidly gaining market share. Initially, we provided about $400k in liquidity with USDC and UST, taking into account the associated risks.

After noticing an imbalance in the concentrated liquidity, we withdrew our funds and increased our liquidity to about $800k. This liquidity provision yielded $7,443.49 in revenue, translating to an APR of approximately 11.4%.

One month later, the Terra shock occurred, causing UST to depeg. We quickly withdrew liquidity and swapped UST for USDC in the early stages, limiting our losses to $14,526.34. The loss rate relative to the provided liquidity was about 1.8%, which is considered minimal given the UST chart at the time.

1. Swap USDC to UST: https://etherscan.io/tx/0xb0ce7131618cc95ab7eac3f8a0a4d3b57bed5fa2aec59124233624113830a426
2. Provide Liquidity: https://etherscan.io/tx/0xa7629d384f74e640e6cf084f301a3a127ce19e0d76daf008d4e462d3d4fe5d75
3. Rebalance Liquidity Position: https://etherscan.io/tx/0x4a5798db091e8610440c03770a1a393249bc7770220f5bb4f5e64f46b0bf437b https://etherscan.io/tx/0x4a5798db091e8610440c03770a1a393249bc7770220f5bb4f5e64f46b0bf437b
4. Withdraw Liquidity: https://etherscan.io/tx/0x45c2b5f1bdab0f0262a2d7f6a467565bb43f4401f76afed883f665ceda790403
5. Swap UST to USDC: https://etherscan.io/tx/0x0e6b44b3cb022f8dcf979a52f473c25b1858c6214a28da3eec00b1f356777c7d

After completing steps 1 and 2, we have not engaged in any further DeFi operations. Due to the unstable market conditions, we switched to a holding-only strategy. While we did incur some losses from the Terra shock, our overall DeFi activities ended with a net profit.

DeFi Profit and Loss: $20,408.74 + $3,506.87 + $7,443.49 — $14,526.34 = +$16,832.76

3. USDC Depeg (March 2023)

Circle’s USDC, which had some of its collateral assets stored at SVB, significantly depegged due to SVB’s collapse. At that time, we held $2,120,715.88 in USDC and had to decide how to respond. Although we didn’t expect USDC to remain depegged, we couldn’t rule out the possibility. To prioritize safety, we decided to swap all of it for USDT. This resulted in a loss of $116,098.08, meaning we lost about 5.5% of our USDC holdings.

USDC eventually returned to its peg at $1, but given the macroeconomic conditions at the time, including the FTX collapse and ongoing wars, it was difficult to predict the market outlook. Therefore, we believe our decision was justified.

Additionally, at this time, we swapped all the DAI obtained from withdrawing liquidity from Balancer (point 1) for ETH. We acquired 294.53 ETH at a price of $1545.52 per ETH.

1. Swap USDC to USDT: https://etherscan.io/tx/0xe9f0cf06b5de195a4dba12379de9358f0cfb38db4eda0f5343ea743ad07cfab3
2. Swap DAI to ETH: https://etherscan.io/tx/0xa1cd2f234857a7088c1188998e663e5591e7fa5f4474e36ffcb79809ce4fb57a

4. Deposit to Symbiotic

We currently have ETH sitting in my fund wallet, but we deposited it into Symbiotic, a re-staking protocol, because we don’t want to waste the opportunity loss. In doing so, we made a separate deposit in cbETH and wBETH.

The fund wallet is a multisig account, but this is operated with the new EOA(DeFi Wallet) because it cannot handle Symbiotic.

140 ETH is swapped for 65.08 cbETH and 71.05 BETH, respectively.

1. Send ETH to new account https://etherscan.io/tx/0x12f1368e3f088d2d2e8134ddb9256744a47a139891ddbaed9d08ca34a80350b1
2. Swap ETH to cbETH https://etherscan.io/tx/0x2a52c5f630f99d9dd02f2f58bb4a766a5357aa5c772a6724747dcc8d83735d42
3. Send ETH to Binance https://etherscan.io/tx/0xb22d94091ef7cbbc625132609e144f7b97db3c32baf213f31a7e54511f32456b
4. Deposit cbETH to Symbiotic https://etherscan.io/tx/0xe9944dcfd948caa2295ba59a2263c0f51a8d0e52fc15ffc3cbc43025c02da494
5. Trade ETH to BETH on Binance and then transfer https://etherscan.io/tx/0xa148652df66de4a96f9ae6dc9bbf5a69845710627cb43c5059b5d830cbf4f848
6. Deposit wBETH to Symbiotic https://etherscan.io/tx/0x0579184ab87b81dd39cba9788bd4b4b3a773ea560c8bfe13d65d2d7363cdeefd

5. Deposit to AO

As with Symbiotic, ETH has been deposited into AO, a decentralized computing network that uses Arweave. Tokens will be distributed in a fair token launch with 1/3 of the tokens eventually distributed to AR holders and 2/3 to users depositing in AO’s bridge.

50 ETH was deposited into DeFi Wallet, swapped to 50stETH and then deposited into AO.

1. Send ETH to DeFi Wallet https://etherscan.io/tx/0xf137dc05168e706cbeb76caed9486c8ffc6fb8ddd6f64380328d28938d734397
2. Swap ETH to stETH https://etherscan.io/tx/0xc61a5af334462ecf0c2dfbc8fddb6c663ef8bcfa5376f860f7b4a0ce20d10cf0
3. Deposit stETH to AO https://etherscan.io/tx/0x70dfc7dd7a19b70938a9c476e1b4e7826c8ef72ddaf17394d01ebc41c79e123c

6. Unrealized Gains/Losses on Held ETH

Capital DAO has accumulated ETH through the CDS token sale and holds it in the Treasury. As of February 2022, we held 500.24 ETH. During the USDC depeg, we purchased an additional 294.53 ETH. After using 0.5 ETH for investments, we now hold a total of 794.77 ETH.

Summary of Gains/Losses (assuming the current ETH price is $3,077.99)

1. Initial holding of 500.24 ETH: Assuming a unit price of $3,188.76 in February 2022, the current unrealized loss is $55,411.47.
2. Additional purchase of 294.53 ETH (excluding 0.5 ETH used for investments): With a purchase price of $1,545.52, the current unrealized gain is $449,372.78.
3. Total: The average acquisition price is $2,579.79, resulting in unrealized gains of $393,961.31.

7. Seed Round Investments (Since November 2022)

Capital DAO initially planned to be a decentralized VC and democratize investments. However, we’ve encountered challenges in consulting with the community about pre-launch project investments. Additionally, the urgency required for making investments, especially in a bear market, has made this difficult. We apologize for having to operate behind the scenes. Given these circumstances and the shift in industry trends, we have redefined our project as a protocol for distributing investment profits. For more details, please refer to our previous article.

*We will disclose everything we can, but some projects remain undisclosed. Additionally, our investments include both those made independently and those made through partners.

2022 Q4

1. [undisclosed]
2. [undisclosed]
3. [undisclosed]
4. [undisclosed]

2023 Q1

1. [undisclosed]
2. CATA: Decentralized data cloud focusing mainly on NFTs, offering a one-stop solution for NFTs.
3. GoPlus: A security platform enabling contract risk assessment and wallet monitoring.
4. KanaLabs: A cross-chain DEX that supports multi-VM (EVM, Move VM, SVM, etc.) and offers an ERC-4337-based AA wallet SDK.

2023 Q3

1. [undisclosed]
2. [undisclosed]
3. EthosX: Short Description: Derivative DEX developed by Kana Labs.
4. Footprint Analytics: Data analytics platform that provides on-chain and off-chain data analysis for app developers.
5. Masa: Marketplace focused on AI, allowing users to earn by providing data to AI while protecting privacy using ZKP.
6. DMTP: Multi-chain message protocol enabling message exchange and chat group creation based on account addresses.

2023 Q4

1. [undisclosed]
2. [undisclosed]
3. Privasea: Decentralized computing resources for AI, enabling machine learning while maintaining confidentiality through FHEML.

2024 Q1

1. GRVT: Order book DEX enabling perpetual futures, options, and RFQ trading on zkSync Hyperchain.
2. 0G: DA layer for AI, offering modules for implementing on-chain AI applications.
3. [undisclosed]
4. Lava Network: Modular network for RPC and APIs, allowing network builders to add RPCs and APIs of any blockchain to build a decentralized infrastructure network.
5. Orange Finance: Automated liquidity management protocol with delta hedge strategies, offering LPDFi using existing DEX LPs.

2024 Q2

1. [undisclosed]
2. [undisclosed]
3. [undisclosed]
4. [undisclosed]
5. [undisclosed]
6. [undisclosed]
7. ETHStorage: DA for the Ethereum ecosystem, distributed storage layer 2.
8. [undisclosed]

Summary

• Current Treasury Funds: $2,040,611.36

600.07 ETH 193,601.90 USDT

• LP : $286,307.85

365,538,401.42 CDS + 46.44 WETH

• Current DeFi Account: $597,376

0.19 ETH 65.08 DC_cbETH (Symbiotic) 71.05 DC_wBETH (Symbiotic) 50 stETH (AO)

• Realized Gains/Losses: -$99,265.33

DeFi Profit：$31,359.08 Terra Shock：-$14,526.34 USDC Depeg：-$116,098.08

• Unrealized Gains/Losses: +$393,961.31 (ETH)
• Invested Funds: $2,480,205

Conclusion

These are the activities we’ve conducted with the Treasury so far. This summary excludes the development of DAO Worker and the maintenance of dApps, which are also ongoing.

As suggested by macroeconomic trends, we believe the industry is poised for renewed growth. Since the second half of 2023, we’ve invested in many promising projects, and this continues today. Ideally, we would like to conduct IDOs based on these investments, but recent trends show that the most promising projects often avoid public token sales. This makes it difficult to secure investment slots for IDOs, complicating our initial activities. As a result, we’ve put IDOs and DAO Worker on hold, making the distribution of investment profits our primary goal. While profit distribution from investments was always part of our mission, it wasn’t our main focus. This shift in focus is what we previously communicated.

However, the IDO platform and DAO Worker are already developed. Therefore, releasing these features remains an option if the opportunity arises.

Future articles will likely focus on reports about investments and profit distribution. While our activities may become hard to understand, please continue to follow and support our efforts!

Capital DAO Protocol

Website : https://capital-dao.xyz/

X: https://twitter.com/Capital_DAO_P

Telegram: https://t.me/CapitalDAOProtocol

Discord: https://discord.gg/2hBBcnqm

White Paper : https://docs.capital-dao.xyz/