Ryan Taylor, CEO of Dash Core Group, recently announced the launch of Dash Investment Foundation, formerly known as Dash Ventures, which will allow the Dash network to invest in projects and receive equity in exchange.
DCG’s @RTaylor05 announces the creation of Dash Investment Foundation, giving the network the ability to invest in opportunities by allowing proposal owners to issue equity or other assets in consideration of network funding. https://t.co/fWmCVSNVa3 #Dash #Payments #Fintech
— DASH (@Dashpay) May 9, 2019
The Dash Investment Foundation was “incorporated on March 21st as a Cayman Islands foundation company limited by guarantee”, Ryan further explained that they “believe it is the world’s first ownerless and memberless investment fund”.
“The foundation creates a bridge between the network protocol and the legacy financial and legal systems. This opens new possibilities for entrepreneurs and the Dash network to partner and mutually benefit from the funding available through the Dash network via Dash Investment Foundation. Importantly, this capability has arrived in time to benefit developers looking to build applications on the Evolution platform.”
The Dash Investment Foundation will split operational decisions and mission objectives between foundation directors and supervisors to help improve efficiencies since “the directors would consist of experts with the appropriate skills to oversee the foundation”, but the “supervisors may consist of virtually anyone trusted by the network to carry out supervisory duties”, Taylor explained.
“Dash masternode operators will elect the six supervisors that oversee the foundation. Key organizational and operational decisions would be put to the supervisors for approval by the foundation’s directors. Day-to-day operations will remain with the directors and investment manager.”
However, two Caymen Island professionals will serve as the foundation’s initial directors and supervisors for the first year to get the project off the ground.
Creating a new, evolutionary funding method
Ryan explained that they intend “to enable Dash Ventures to operate completely independently from Dash Core Group” and will thus, offer his “services to the foundation for the first year as a non-voting participant to answer questions, and provide any expertise, direction, guidance, and counsel to the supervisors to help ensure all intents of the foundation’s constitution are clear”. Ryan also elaborated that in addition to holding elections from May 23rd to June 16th with Dash Watch auditing the results, they still need to request operational funding from the network and investment funding to “allocate assets to Dash Investment Foundation to seed its investment program”.
Then after finalizing the election and operating costs, the Dash Investment Foundation will polish off some remaining details.
Appointment of an investment manager
Ratifying an overarching mandate for the foundation and internal governance and operational protocols
Ratifying a mandate for investment objectives (e.g., maximize returns vs. growth of Dash usage)
Establish investment funding processes (e.g., process for proposal owners to enter legal agreements)
Ryan also mentioned in the Q1 quarterly call that “as a permission-less network, it was critically important for us to avoid any KYC or AML processes for Dash users to participate or benefit from any distributions”.
“Our solution was to avoid distributions all together, which would have required participants to submit information about themselves to this entity for compliance reasons. Instead, if there is ever a need to distribute funds, the foundation can simply purchase Dash on the open market and destroy it to facilitate transfer of value to all Dash holders equally. This would reduce the circulating supply and have the effect of boosting the price of Dash in a manor similar to a stock buyback.”
Ryan also added that more details will be released in “the coming days regarding the supervisor elections and the proposal to cover initial operational costs”.
Dash evolutionized the cryptocurrency space by introducing a Decentralized Autonomous Organization with a Masternode and Treasury system to be able to allocate a maximum of 10% of each month’s block rewards to proposals that attempt to improve the Dash network, community, and/or increase adoption. In fact, the Dash Core Group, Dash News, Dash Watch, and other organizations are funded through this method. This helps prevent these groups from relying on volunteer time, which limits availability, or third party funding that distorts incentives and motivations.
Dash Investment Foundation will also now enable Dash to invest in a broader range of proposals since the current treasury system is similar to a decentralized grant system. This makes Dash masternodes wary of funding very risky projects that had no or little track record of contributing to the Dash network. The Dash Investment Foundation can now focus on riskier projects since they are able to take equity in the company and get a more direct reward. However, this depends on the exact mandate they take since focusing on maximizing returns or growing Dash usage requires different risk matrices. Nevertheless, Dash now has more decentralized funding and expansion options to provide digital cash en masse to consumers thanks to its evolutionary structure and developments.