Hi, it’s me again.. but now that the FY2026 budget has been shared and this SLURP has matured through discussion (and even an addendum, which surprised me a bit, given it hasn’t been voted on yet and is still malleable), I wanted to drop in with something that clicked for me yesterday.
Call it an “eureka moment” or just the benefit of sleeping on it: I realised there might be a way to preserve the spirit and goals of this proposal while making the whole process more inclusive, more capital-efficient, and eventually easier to scale for future treasury sales.
As I said earlier, the intent here is very clear and, in my view, directionally correct:
- extend runway in the ~$250k–$300k range
- build SDL/LINK liquidity on Base (so hopefully SDL will be available to Coinbase users)
I wanted to share a slightly different angle that tries to keep those same goals, but potentially unlocks more inclusivity and long-term efficiency for the DAO.
1. Quick thoughts on the current OTC structure
Both tracks make sense on paper: aligned buyers, no open-market slippage and a clear path to USDC runway and Base liquidity.
The addendum improves a few pain points by:
- switching from a fixed SDL amount to a $350k USD cap across both tracks
- explicitly targeting $250k–$300k in proceeds
- adding an initial $50k per-address cap with a $20k minimum ticket
Shifting to a USD cap is a nice upgrade.. it removes some of the “what if price moves mid-process?” risk, and it’s exactly the kind of constraint that on-chain tools like CoW Swap/Milkman are designed to handle (more on that in a second).
Where I personally start to hesitate is around 2 things:
-
Discount as a structural cost: a 10% discount on a $350k cap is effectively ~$35k “spent” by the DAO to secure this round. That might be the right call, but it’s still a real opportunity cost.
-
Access and distribution: a $20k minimum and KYC requirement inevitably push this towards a small, relatively exclusive set of buyers. That can both concentrate governance risk and make some community members feel like they’re watching an insider round from the outside (note @Erazz, @Stackin, @Leonardo comments above).
I don’t see this as malicious (I understand most are long term SDL suporters).. it’s just the natural result of using a traditional OTC structure inside a DAO.
2. CoW Swap Execution (Plain English)
In the context of SLURP-54, where the DAO wants to sell a defined amount of SDL via OTC to buyers (with or without LP commitments), there are a few execution paths worth understanding:
a) Limit Order
The DAO signs an order that says:
“Sell X SDL at a minimum price of Y (e.g. based on recent average)”
This is enforced, the order won’t execute below that price. Once live, it becomes first-come, first-served: any buyer who meets the terms can fill the order fully or partially, instantly.
- Pro: Simple to implement
- Con: Allows a single buyer to take the full allocation
b) TWAP (Time-Weighted Average Price)
Instead of posting the entire SDL amount at once, the DAO defines an intent like:
“Sell X SDL over N days in small batches, targeting the average market price during that period.”
Structuring the sale execution in smaller chunks over time, for example, split across 7 days.
This reduces market impact and gives multiple buyers time to participate, avoiding a single buyer sweeping the entire deal.
- Pros: Encourages broader participation. Smooths price execution.
- Cons: Requires scheduled and fine tuned execution to allow larger buyers to opt-in.
c) Milkman (Oracle-Validated Execution)
Milkman is designed for situations where execution happens later (e.g., after a governance delay), so the DAO defines an intent like:
“Sell X SDL at the fair market price at execution time, as validated by an on-chain oracle.”
Instead of locking in a fixed price upfront, Milkman checks a trusted oracle (typically Chainlink) at the moment of execution.
The sale only proceeds if the observed oracle price is within an acceptable range, protecting the DAO from stale pricing, MEV, or manipulation.
- Pros: Protects delayed executions from bad pricing. Useful for DAOs with automated, time-delayed governance
- Cons: Requires a reliable SDL price oracle. Not necessary when the multisig can execute manually and time the sale
Note: Many top tier DeFi protocols, like AAVE, are using CowSwap to exectue DAO related trades. All the info here:
3. Unbundling: sell at spot, then decide how to “pay” for liquidity
Right now, SLURP-54 effectively bundles two things together:
- Selling SDL to raise USDC
- Paying for Base liquidity by giving buyers a 10% discount + asking them to LP for a year.
My intuition is that we might be better off unbundling those:
- Step 1 – Sale:
Use Milkman (or even a simpler CoW limit/TWAP setup) to sell up to $350k of SDL at market price, no discount, with the same USD cap the addendum introduces. - Step 2 – Liquidity strategy:
Take the “discount delta” (roughly that 10% we weren’t giving away) and use it deliberately to:- bribe an SDL/LINK pool on Aerodrome for a few epochs to pull in LPs, and/or
- start accumulating veAERO so the DAO owns long-term voting power over Base emissions.
In other words: instead of giving a 10% bonus to a small group of OTC buyers, we sell at spot and redeploy that 10% into incentives and governance assets that:
- benefit anyone who LPs on Base (including people who would have subscribed to the OTC),
- help decentralize SDL holder distribution, and
- potentially fund multiple years of SDL/LINK emissions on Base rather than a single 12-month contractual commitment.
I also like that this path doesn’t fight the spirit of the proposal: the USD cap, the runway target, and the focus on Base liquidity all remain; we’re just changing how we get there.
4. What this means for SLURP-54 concretely
To keep things practical and respectful of everyone’s time:
-
If the DAO feels comfortable moving now:
One option would be to adapt SLURP-54 so the “Spot Support” component (or even the whole raise) is executed via Milkman rather than bespoke OTC agreements, still capped at $350k, but at real time market price and open to all. The Standard Track LP commitment could then be re-imagined as Aerodrome incentives/veAERO purchases funded from the saved discount, instead of as a legal lock-up. -
If that feels too rushed:
I completely understand if governance bandwidth or technical comfort makes this hard to integrate into the current SLURP. In that case, I’d still love us to:- treat SLURP-54 as a one-off bridge to secure runway, and
- explicitly plan the next SDL treasury sale as a Milkman-style, market-price sale + Aerodrome/veAERO liquidity program.
Either way, my aim here isn’t to block the OTC or to criticize those willing to step up with capital. It’s to see whether we can evolve this pattern into something that:
- keeps the same runway goals,
- gets us strong Base liquidity,
- is capital-efficient for the DAO, and
- feels inclusive to smaller community members rather than like a velvet-rope round.
5. Closing
Huge thanks again to everyone who’s been driving this forward.. it’s clear a lot of thought went into the tracks and the addendum. I’d love to hear from others (especially folks with deeper Aerodrome/ve(3,3) experience.. cough @SethVdL cough) on whether this “sell at spot + program the discount into Base” approach feels like an upgrade, or if there are risks I’m underweighting.
If we can get this right, my hope is that we not only solve this OTC, but also create a reusable template for future sales that brings more people in, strengthens Base, and scales with the protocol.