ELO DAO solves DeFi's liquidity problems by providing bonds-as-a-service
The goal of the ELO protocol is to create the decentralized, autonomous and censorship-resistant financial tools needed for the emerging Web3 ecosystem. The development of liquidity bonds is important because a fundamental goal of the Web3 finance movement is to foster an alternative economic ecosystem that serves the needs of its various stakeholders, in the real and digital world, including:
- Have access to unique, purpose-built assets that are widely and uniformly available on different blockchains, across L1 and L2
- Being able to transact/store value in highly decentralized and censorship-resistant assets that are not dependent on the traditional financial ecosystem for validation or survival
- Decentralizing the power of the TradFi, by being a Protocol-Owned Liquidity (POL) as an example and encouraging this method among our partners through our customized issuance of liquidity bonds. POL is an attempt to solve bootstrapping liquidity while avoiding the cost of paying self-interested external liquidity providers (mercenary capital). Rather than renting, ELO DAO owns its own liquidity.
ELOCOIN (ELO) is the governance token of ELO DAO. ELO DAO’s goal is to create a credibly decentralized standard for Web3 and to help onboard users, founders and businesses into a decentralized, democratized economy, with the additional goal of becoming the DeFi's reserve asset.
What are DeFi's reserve assets designed to achieve?
- Preserving purchasing power: Over the medium- to long-term the asset grows due the expectatives of futures cash flows, and becomes more stable over time.
- Deep liquidity: Reserve assets are highly liquid and can be easily exchanged for other assets, products and services.
- Reserve assets serve as trusted backing: The DAO is viewed as reliable and relatively low risk with shares along other DAOs and assets, which encourages entities to hold large quantities of it in reserve
- Utilized as a unit of account: Other assets are denominated in the DAO token (Metaverse, NFTs, commerce...)
Currently, ELO DAO is early on its journey to secure ELO's status as a decentralized reserve asset. The ELO Action Plan outlines the concrete steps the DAO is taking to make this vision a reality in 2023, including making ELO as automated and governance-minimized as possible.
In contrast to the incumbent TradFi system which is constantly manipulated in opaque and unethical ways, our goal is to build and retail a real decentralized protocol that empower individuals over institutions, bringing transparency, trust and equal opportunities for all the stakeholders. ELO DAO’s efforts in Treasury management, development of on-chain governance structures, and prudent use of ELO’s liquidity and Treasury assets will help to strengthen ELO as the DeFi's reserve asset.
ELO is run by ELO DAO. ELO DAO is a network of dedicated community members who execute on decisions & protocol mechanisms voted on through community governance.
Our eventual goal is to build an autonomous system at the protocol level, in which the behavior of ELO is largely influenced by decentralized smart contracts and with minimal human intervention. The DAO is pursuing a strategy of “progressive decentralization.” Currently, major components of the protocol are controlled at a high-level by the DAO. Though, ultimately the focus is on creating a foundation at the Treasury, Policy and economic levels, and to enable the community to directly operate protocol mechanics – in a trust- and process-minimized fashion.
Protocol Owned Liquidity, is the amount of LP the treasury owns and controls. The more POL the better for the protocol and its users. Protocol Owned Liquidity (POL) guarantees users that there is always sufficient liquidity for normal market operation. In other protocols, in case of a bank run, liquidity is often pulled from the protocol, exacerbating the situation with less exit liquidity. This is the base of the protocol.
Proof of Reserve, is the mechanism of strengthening the reserve of ELODAO treasury via the sales of bonds. Bonders provide liquidity to the treasury, thereby building its reserve. In return for their service, bonders get paid in ELO.
All proposals, whether being consistent with the general direction of the DAO, a change in policy, or a pivot to a certain strategy or framework are voted for by the community. Any member of the community can create a proposal on the future forum or Discord for discussion before being posted to snapshot for a governance vote.
ELO Governance Council (EGC) will be initially comprised of 7 veteran community members who are primarily responsible for facilitating off-chain processes. These can include, but are not limited to, establishing strategic vision, coordinating working groups to execute on community-approved initiatives, and proposing strategic initiatives to the community via OIP.
Key deliverables for the EGC include:
- Drive prioritization and alignment across the DAO departments and working groups
- Chart a path to further decentralized DAO governance and operations
- Oversee the broader ELO economy
The policy team will be composed of about 20 members of the ELO community who have displayed sufficient knowledge of the protocol and a curiosity to continue to learn as the protocol grows in size and complexity. Policy is largely guided by a policy framework.
Policy closely monitors the behavior of the protocol and utilizes the powers assigned to them in the policy framework to actively manage the protocol. The Policy is committed to help bring inflows into the treasury, and continue to increase ELO's relative backing, and helping ELO DAO to continue developing products and services that grow the ELOCOIN economy.