Over the past few years, there has been explosive growth in the number of DAOs amid a paradigm shift in blockchain governance. DAO has proved to be a game-changer through community decision-making, as they have challenged the role of the central authority present in existing organizations.
As for what DAOs, or decentralized autonomous organizations, stand for, they are member-owned and blockchain-governed communities that work towards a shared mission without centralized leadership. They have built-in treasuries, which require the group’s approval to access.
Smart contracts are the core of DAOs as they define the organization’s rules and hold the treasury. Decisions in DAO are governed by proposals and voting to ensure everything happens transparently on-chain and everyone in the organization has a voice.
There’s no denying that with the popularity of DAOs these past few years, they have pretty much overrun the cryptocurrency space. Yet, DAOs are not issue-free. As such, DAOs lack the rigor and comprehensiveness required for financial governance.
Proposing and voting on generic issues are the most overlapping part of all the solutions provided by the top-tier “DAO builders.” In fact, only a few proposals regarding a DAO’s finance can be executable on-chain after they are voted into resolutions, and executed cross-chain.
Lack of functionality is another factor that exacerbates the problems that DAOs suffer from. Moreover, integrity and regulation-related exposure also remain entirely unaddressed, rendering these “DAO builders” inadequate to be used safely to funnel DAO assets to meet with DeFi liquidity.
On top of that, there isn’t any coherent way of tying today’s DAO builder’s own interest with that of its client DAOs, whose versatile and unpredictable utility of their own tokens makes it a challenge to be integrated into a governance framework. This calls for a DAO operating software stocked with these urgently needed capabilities.
Need for Better Financial Governance for DAOs
The rise of decentralized finance (DeFi) ignited the 2020 bull run, and for a good reason. This emerging financial technology can profoundly disrupt the financial services industry.
Since DeFi first gained traction, tons of projects have entered the market targeting insurance, lending & borrowing, asset management, savings, trading, derivatives, etc. Unfortunately, the wave of DeFi has spawned prolific trading facilities to the degree of saturation, yet more is needed to solve the lack of tradable assets on blockchains. When there aren’t enough incremental legit “tradables,” the market has fallen into the trap of self-propelled leveraging, which inevitably resulted in the spectacular implosion we’ve all witnessed for the past half year.
Financial instruments backed by non-local assets and assured by credit mediators in the form of DAOs are inevitable for the ubiquitous DeFi to be utilized, hence the urgent mandate of financially focused DAOs that are rigorously constructed, flexibly operated, and professionally equipped for asset origination and securitization.
But as we discussed above, today’s DAOs are far from being able to realize this. This is where Ink Finance comes into the picture. As a relatively new DAO tooling platform, Ink Finance aims to be a gold standard of on-chain financial governance, enabling a well-managed DAO to be its own corporate banker or asset manager by establishing fiscal competence and a cross-chain reputation.
The Singapore-based Ink Finance was founded by CEO Tony Tang, who brings over two decades of experience in asset-backed financing, asset management, and fintech leadership to the project.
His stint at top financial institutions, including Solomon Brothers, Bear Stearns, Citigroup, and Deutsche Bank, in senior leadership positions, across several key financial sectors gained him deep theoretical insights, battle-tested experience, and stellar track records in the global financial industry along with an extensive business and financial network that can help the DAOs running on Ink Finance meet the challenges confidently.
Financial Solutions within One Framework
Ink Finance is built for financially empowered DAOs. It has a wide range of use cases such as NFT financing, liquidity sourcing & fundraising, CeFi crypto or VC/Angel funds moving on-chain, DeFi community providing liquidity for DAO products, and trade finance. These features allow Ink Finance to immediately service the rapidly growing sectors of the Web3 market, such as Metaverse, GameFi, venture and angel funds, crypto asset management, and real-world fintech (such as carbon reduction credits or cross-border e-commerce receivables).
These growing sectors have tremendous established depth, providing a wide open two-dimensional space for Ink Finance to scale into. Ink Finance aims to be a gold standard of financial DAO construction and operation, with the very tangible goal of allowing DAOs to issue bespoke financial products that are verifiable and clearable on-chain, which can be used to finance its growth while meeting the scrutiny of DeFi investors.
As a no-code infra, Ink Finance provides a web app that allows for DAO creation, treasury management, asset management, and cross-chain DeFi, all at the user’s fingertips. As a result, there is no more burden for the DAOs to look for fragmented products that are difficult to integrate into one management structure. Furthermore, these functions are carried out by the smart contracts independently created for the DAOs, and each of them can be uniquely adjusted to meet the different regulatory requirements.
At last, INK provides complete on-chain analytics and risk management. Here INK goes beyond just providing basic proposals, votes, and payment services offered by regular DAO tools. It actually gives DAO managers the ability to analyze community feedback comprehensively. The on-chain executed fiscal control and risk control tools can generate transparent and analytical data to protect DeFi investors from fraud and abuse.
Building Integrity Assured DAOs
The project also offers comprehensive protection against Sybil attacks and whale manipulation. For this, it implements various levels of ID verification. It has partnered with some of the cutting-edge technological protocols, such as Humanode (the first crypto-biometric verification network) or Astra Protocol (a decentralized legal identity verification platform covering 140+ countries and regions). In addition, INK also develops its own social media verifications.
Again, all these safety and integrity measures are conveniently offered to DAOs within a coherent governance framework. Additionally, for DAO managers and non-managing DAO members, the complete set of choices is available for different combinations of usage, enabling any decentralized organization to operate safely in the Web3 environment with integrity.
The Most Innovative SaaS Economic Model
The first crucial element of INK’s economic model is intended for any DAO to turn its meta token into an efficient, and well-defined, governance capital. In such a mechanism, the DAO’s highly customizable staking contract builds the first line of defense against Sybil’s attack via “stake to govern.” It further enables a DAO to issue merit-based badges to guard against whale attacks. “Having skin in the game” is achieved on INK, with the balance of power between financial stakeholders and community contributors.
The second element of the INK economic model lies at the core of its tokenomics – how Ink Finance rewards its native token holders. For a DAO to unlock all the governance and financial features built for it, its admin must acquire INK’s native token, QUILL, as a turnkey. This is a strikingly different pricing model than Web2 SaaS software. It encourages DAOs to consider QUILL as a reusable capital resource. Any DAO can be sure that even when its business fails, it can still recover the capital expenditure invested in QUILL. Neither building their own infrastructure nor paying cash for a subscription can match such an advantage. By staking the QUILL tokens, DAOs also gain governance rights of the Ink Finance protocol and earn the staking rewards. It is a mutually beneficial economic model in which the QUILL holders and the user DAOs share their growth.
Suppose a DAO needs to find a way to afford to spend upfront capital to acquire and stake QUILL tokens. In that case, INK’s economic engine allows for a protocol-level sponsorship and an individual QUILL holder-initiated sponsorship. Again, such sponsorship mechanics allow QUILL holders, either as a whole or as individuals, to share the growth and value generated by the user DAOs.
A Powerhouse for Financial DAO Tooling
Ink Finance recently closed a $2.5 million fundraising round to finance its ambitious goals, completing a $4 million total raised in two funding rounds. Before the closing of its latest round, Ink Finance graduated from Alliance DAO’s ALL7 accelerator as one of the top 3 most inquired projects and is now a proud member of and contributor to the Alliance DAO.
Republic Crypto, Alliance DAO, Avalanche Foundation, Polygon Foundation, Draper Dragon, GSR, LD Capital, Krypital Group, and others have continuously contributed to the project’s go-to-market and expansion. With such strong backing, the 18-people team of Ink Finance is fast at work on delivering the products and services on multiple blockchains, as well as aggressively expanding its reach into the most relevant sectors.
The project has launched its beta version for open testing simultaneously on Avalanche, Ethereum, BSC, and Solana, to be the second generation of DAO tools and the financial DAO SaaS on those respective networks. Everyone is welcome to join.