Stablecoin Diversification: Strategic Sales


Over the past three months, the OGP has diversified a portion of its OSMO treasury into USDC by conducting sales with strategic partners.

As a reminder, having access to stablecoins allows the OGP to pay vendors, legal service providers, and US-based grantees. Stablecoins also protect the OGP from price volatility and allow it to function regardless of market conditions.

In total, the OGP has diversified 2,734,374 OSMO into 3,500,000 USDC to date, at an average price of $1.28/OSMO. The price was agreed upon via a 7 day TWAP done in early June. Regarding the terms of the sale, we optimized for price execution and prioritized returning as much capital as possible to the DAO. Accordingly, purchasers did not get a discount, or a token cliff/vesting. At the time of execution, the sales were done at a premium to the spot price. All proceeds are being held in the Gnosis Multi-sig listed on our website. (Please note certain grantee payments and expenses have been paid out with this USDC).

The purchasers include Bain Capital Crypto, Ethereal Ventures, and Cygni Capital. They have been long-time supporters of Osmosis, have well-established relationships with the core team, and have been very helpful for the protocol.

We explored multiple methods for the sale, including selling via an OTC desk, selling to the community, or selling on Osmosis itself. Selling to long-term VC funds is the best option, as they have long time horizons and will not cause a direct impact on the market. Going through a desk, or selling through an AMM would cause a direct impact on the market. Going through a community-led process would result in a long, drawn-out process that is more complex and difficult for all parties involved. 

Through this sale, the OGP is well-funded to make all stablecoin-denominated payments for the foreseeable future. Going forward, we will consider making additional diversifications as needed.

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