The NFTX DAO is considering a Treasury rebalancing after USDC wobbles
A decentralized autonomous organization’s token holders are voting to diversify $2 million of its treasury’s assets amid a volatile crypto market. The NFTX token holders are considering a proposal to diversify their treasury shortly after one of their investments, the USD coin (USDC), briefly lost its peg to the U.S. dollar. NFTX bills itself as a liquidity protocol for non-fungible tokens (NFT).
The USDC incident earlier this month was a harrowing moment for the cryptocurrency industry, as a key asset that investors used to safely – it was thought – park money suddenly proved uncomfortably volatile. USDC is the second-largest stablecoin by market cap and represents all of NFTX’s stablecoin investments.
Aside from its own governance token, NFTX has about $20 million in its treasury. USDC makes up about $1.3 million of that. As part of the proposal, $2 million would be moved elsewhere. Holding stablecoins in USDC has already proven to be suspect to depeg in case of maximum chaos, 0xchop wrote. If diversifying stablecoins into multiple stablecoins does not significantly impact operations, then it must be considered.
The proposal will be decided when a quorum of 50,000 tokens has been reached, which is 10% of NFTX’s circulating supply. The vote has reached about 49,00 tokens, 94% of which are contributed by the address responsible for launching NFTX’s infrastructure.