TrueFi DAO, Step 2: Announcing the TrueFi Foundation
Step 2 of 3: Supporting TrueFi’s on-chain governance with the launch of an off-chain foundation representing TRU holders
Since announcing TrueFi’s path towardwards decentralization, TrustToken’s TrueFi contributors have designed and deployed the protocol’s on-chain governance and time lock contracts with unanimous approval from TRU holders.
A number of proposals transferring key components of the protocol are underway and being composed at the time of this post. These motions are being discussed in Discord, proposed on the TrueFi forum, signaled on Snapshot, and now, brought to a final binding on-chain vote using stkTRU on Teller.
At the same time, the TrueFi Discord is growing into the operating hub of the TrueFi DAO, where verified stkTRU holders can not only discuss ideas for governance, treasury, or tokenomics initiatives, but join committees of fellow token holders to turn these ideas into action.
Simultaneously, TrueFi has continued the journey of decentralizing its off-chain assets and permissions with the launch of a foundation representing the interests of the community.
Introducing the TrueFi Foundation: the legal entity serving the interests of the TrueFi DAO, representing community members, and managing the off-chain assets and obligations of TrueFi.
The TrueFi Foundation
From inception, TrueFi has been designed to become the definitive protocol for global lending. By combining the superior infrastructure of DeFi with a strong compliance and legal foundation, TrueFi aims to bring the $8+ trillion lending market of traditional finance on-chain.
To both serve the highly regulated global institutions that are critical to this market (like banks and investment funds), and support the unique business TrueFi is becoming, it is necessary to establish a legal entity to serve the TrueFi community.
Officially registered in the British Virgin Islands as a company limited by guarantee without shares on the 7th of June 2022, the TrueFi Foundation is now an official part of the TrueFi ecosystem. This hybrid DAO structure, featuring both a decentralized, open source protocol and a foundation serving the TrueFi community, allows for the legal entity to represent the interests of DAO members when interfacing with TradFi.
The TrueFi Foundation will continue to explore other favorable jurisdictions in the future.
The Mandate of the TrueFi Foundation
Starting immediately, the Foundation will begin to act as an Administrative Agent to pursue defaults that may occur within the DAO lending pools using TrueFi’s new DeFi Master Lending Agreement (the “dMLA”). It will also be the primary entity responsible for responding to the TrueFi protocol’s legal, tax, and regulatory obligations.
Starting with this limited scope of responsibility, the full mandate of the TrueFi Foundation will be entirely up to the members of the TrueFi DAO.
The Foundation will also serve as the home for TrueFi’s various assets, including 100% of all Community TRU assets, 100% of all Incentive TRU assets, all of TrueFi’s intellectual property, and a range of licenses and contracts that keep TrueFi running.
Foundation Design
In order for TrueFi to properly scale while limiting the liability of DAO members, the TrueFi Foundation is incorporated as a BVI “company limited by guarantee without share capital.”
The operating design ultimately envisioned for the Foundation will see those who contribute 1 TRU as a “membership fee” to become guarantee members. This role will not permit them any ownership over the entity, but will legally designate them as a guarantee member of the TrueFi Foundation and voting member of the TrueFi DAO. All guarantee members’ liability for the debts of the foundation is limited to the value of their 1 TRU guarantee. A member’s voting power will still be represented by their stkTRU holdings.
In the future, custom drafting of the TrueFi Foundation articles of association and DAO smart contract development will formally create the legal and technical connection between a member’s stkTRU tokens and legal membership in the TrueFi DAO. It’s at this point that TrueFi DAO membership will be based on a person’s legal membership in the TrueFi Foundation, providing legal certainty and limited liability for TrueFi DAO members to operate efficiently and scale rapidly within the evolving global regulatory landscape.
Foundation Governance
The day-to-day operations of the TrueFi Foundation will ultimately be managed by a board of directors elected by TrueFi Foundation members who will serve at the pleasure of and for the benefit of the TrueFi community.
While the Foundation’s first board will be assembled by appointment from some of TrueFi’s most important contributors (including members unaffiliated with TrustToken), each member of the appointed board will need to win reelection to continue serving the TrueFi Foundation.
Proposals for changing or adding board members will follow TrueFi’s standard governance workflow for motions without on-chain elements, culminating in a binding Snapshot vote.
Get Involved with TrueFi DAO
TrueFi eagerly awaits your contributions. As of writing, our Discord is home to active discussions on changes to TRU tokenomics, allocation and treasury committee members scrutinizing portfolio incentive requests, and a growing number of delegate proposals.
Join the TrueFi DAO Discord now, verify your stkTRU, and find the DAO committee relevant to your interests and skills.
Not expecting to be actively involved in TrueFi Governance? TrueFi DAO’s design supports delegation, allowing you to allocate your voting power to a fellow TrueFi community member so long as you know their wallet address. You can review current delegate proposals on the forum, or submit your own today.
In the next update on TrueFi’s progressive decentralization, we’ll introduce the board governing the TrueFi Foundation and describe the process of board elections, as well as cover a number of current and upcoming on-chain votes putting ever more of TrueFi into the hands of its community and foundation.
