For ELO DAO, the Treasury is a key function of the protocol. The Treasury represents all assets owned and controlled by the protocol. This is also known as Protocol Controlled Value (PCV) or Proof of Reserve (PoR). The Treasury defines a few internal classifications, and all of them combined represent the budget for various market operations, or the ability to influence ELO.
- Treasury Reserves, represented per token as liquid backing, this represent a total budget ELO has for various market operations.
- Protocol owned liquidity – Deep liquidity is one of the central pillars that make a reserve asset. Liquidity owned by the protocol is a guarantee a liquid market facilitating exchange in both directions exists.
- Locked, vesting, or other strategic assets
The concept of 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.
Without being reliant on external liquidity providers, ELO can guarantee a liquid market for OHM while establishing a revenue stream from LP fees for the Treasury.
All protocol liquidity adds towards ELO backing – the LP tokens are marked down to their risk-free value for this purpose. You can read more about the rationale behind here.
While Olympus’ POL will always remain crucial to its goal of being a reserve currency, as it matures it will be equally as important to have other market participants who share aligned interests help to make OHM more easily accessible across different exchanges and platforms.
ELO DAO provides a bond marketplace for protocol owned liquidity. When users purchase Bonds through Olympus Pro, it allows Protocols to accumulate liquidity to secure longevity and price stability for everyone involved. This makes bonds a mutually beneficial exchange.
ELO DAO can be a tool for our partner DAOs to pursue other strategies, because ELO Bond Marketplace can be used to exchange any two different assets.
ELO Incubator is an initiative to help foster the growth of the ELO economy, providing value:
- community bootstrapping
- exposure and promotion
- advice and assistance
- early funding
- access to our launch and liquidity products
- early usage of a protocol