TL;DR
- Allocate $1.124M for Q4 Development and Operations
- Allocate $17.1k for Q4 Marketing & Discord support
Background
Ever since the transition away from the Association was completed a year ago, the actual run rate of the DAO has been about $2.1M/year.
This was achieved primarily by making the builder budget as lean as it gets: it covered only core development of the new protocol and support for the deprecated Badger products.
As mentioned in Q4 '25 funding TCD, there are limits to this approach:
I consider this rate of spending to be enough for R&D and building stage, but to launch the product we’ll need more funding eventually to pay for audits, scale up marketing, and hire a busdev.
The time for audits and a new hire is coming in Q4 '26.
As audits often need to be reserved months in advance, it’s best to allocate the funds beforehand.
On the legal front, BIP 109 has passed, and the DAO is currently in the process of incorporation as a Marshall Islands DAO LLC.
Regarding legal defense, we still haven’t received the ruling on the motion to dismiss.
Without that, the current path is to defend the DAO in court, hence the legal expenses for Q3 and Q4 have been increased.
Budget
The proposed budget for development & operations for Q3 is $1.124M:
The major changes compared to the Q3 budget are:
- $400k is reserved for Audits
- Legal fees increased from $111k to $200k
- Builder budget increased to make room for a new hire and associated recruitment fees
Here’s the consolidated DAO budget for more visibility:
An important caveat here is that the annualized Q4 burn rate is not representative since it includes a couple of large one-time expenses.
If the whole Q4 budget is utilized, the DAO expenses for 2026 would still be at $2.9M. The actuals are likely to end up closer to the $2.7M mark.
Since audits are such a big part of the equation, we expect the Q1 '27 budget to be significantly lower than this one.
This decision also approves the Marketing & Discord quarterly expenses of $17.1k, which are separate from the dev & ops budget.
Vote
- Yes - Approve the Q4 budget as specified above
- No - There’s a better way
