Volta Club Treasury Q2 2024
The treasury spreadsheet showing positions as of the 30th of June, 2024 is included at the end of this article as always. We are recovering from an incident at UwU Lend quickly and have already cleared nearly $12 million in debt. Buybacks have continued throughout this quarter, further shrinking the supply of Volta available on the market while increasing backing with each purchase.
The altcoin market has seen a sharp retraction as BTC and ETH take a summer break. Most of DeFi is down significantly more than Volta. We are diligently working towards a return to growth.
A Look Around the Market
The crypto market cap shrunk from ~$2.8T to ~$2.4T this quarter. It is important to note that a good chunk of the market cap is low liquidity meme coins that can vaporize quickly. Many major DeFi coins are down 60–70% from previous highs this year. ETH began the quarter at $3,636 with BTC at $70,847 from our last snapshot on March 31st. As of our June 30th snapshot ETH is at $3,368 and BTC is $60,865.
Traders have been holding out hope that an ETH ETF will be approved early during this quarter, which explains the improvement in BTC/ETH ratio. Gas pricing to transact on (ETH) chain are at historic lows not seen since 2016.
Our View and Strategy
We feel cautious about the overall impact of an ETF approval for ETH. Retail appetite to gain ETH exposure seems limited. However, gas prices may indicate a bottom has been reached with a run up in the making. BTC has historically done very well after a post halving retraction led by miner capitulation. The total BTC hashrate has fallen significantly as miners switch off machines.
Our largest position in Sifu tokens saw a modest move down of 10%. Most of our directional plays are wrapped inside our tokens here. This is expected as major altcoins are down significantly, Arbitrum (ARB) -52%, Synthetix (SNX) -57%, Avalanche (AVAX) -46%, to name a few examples.
Interest rates for deposits are very high (~50%+) on many assets on UwU Lend including stables, wETH, and wBTC as of the time of this writing. This encourages deposits and debt repayments as we work towards clearing all bad debt on the protocol. This also generates a large amount of revenue for LP stakers of which Volta has a large position.
Users of UwU Lend are able to withdraw if they wish and no loss of user funds occurred. The vast majority of borrows on UwU Lend are legitimate users with healthy loans. Much of the bad debt has been paid off using the UwU Lend treasury already with ~$11.6 million paid.
CMPs
A number of CMPs were proposed and were voted down, with one passing:
- CMP 9: redemption roulette
- CMP 10: quarterly redemptions
- CMP 11: quarterly redemptions v2
- CMP 12: monthly AMA
- CMP 13: budget reduction
- CMP 15: non-tradable token
CMP 14: Increase threshold [to post CMPs] did pass. This raises the amount of Volta a user must posses to post a snapshot. Read the proposal and reasoning here.
Treasury Spreadsheet
Liquid treasury June 30th, 2024: $32,879,854
Despite the reduction in liquid value, the supply of Volta continues to shrink as buybacks take them off the market. A total of 15,937 coins were purchased this quarter. This reduced the total supply from 250,000 Volta to 234,063. Each Volta is backed by $140.47 of liquid assets. The high watermark of $173.23 remains unchanged and no performance fee was paid this quarter.
Full backing including illiquid tokens and vesting streams stands at $212.53.
