Model
Algo DAO has devised an innovative framework to exchange expertise and support for a stake into the equity of growing digital asset ecosystems and companies.
Last updated
Algo DAO has devised an innovative framework to exchange expertise and support for a stake into the equity of growing digital asset ecosystems and companies.
Last updated
AlgoDAO acquires tokens through its treasury account of $ALGO native tokens by swapping them for the target tokens based on a predetermined exchange ratio.
For example, ALGO decides to allocate 50,000 $ALGO tokens in exchange for 100,000 $TARGET tokens. The exchange is 1:2 in favor of ALGO.
The exchange ratio between the two tokens is calculated by taking into account an estimation of the value of the contributions and services to be provided by Algo DAO to the target project as well as the inflationary pressures of the $TARGET.
The DAO shall simultaneously forward the $ALGO to the treasury account of the target project. And the target project will send its own respective token amount to ALGO treasury account. The funds could also be put in a smart contract and released on a certain schedule based on specific project milestones and timelines.
This is done on a case by case basis, as the circumstances dictate. It mostly depend on the target company and their stage of development. The DAO could receive a SAFT allocation if the projects' tokens are pre-listing, or leverage a multisig smart contract if the tokens are already public and tradeable.
The programmability of blockchain also gives flexibility in the creation of earnout programs and other forms of collaboration that are not replicable on traditional financial rails.
Algo Capital DAO has completed its 1st acquisition of a stake in Stubull.Finance, a Stableswap DEX focused on Non-USD Stablecoin liquidity and on-chain FX.
Below a breakdown of the deal inked with Stabull:
Algo Capital DAO received 26,667 $SFX tokens
Stabull received 20,000 $ALGO tokens collateralized with $20,000 worth of fundraising services from Algo Capital DAO
The exchange price paid by Algo Capital DAO was $0.75 $ALGO for each $SFX tokens
Algo Capital DAO and Stabull furthermore agreed on a milestone based payment of 3.5% on any investment facilitated through warm introduction by the DAO over the $150k threshold.
After the acquisition, Algo Capital DAO introduced Stabull to their lead investor, a Canadian Public Company which allocated $500k to the SAFT round.
Following the introduction, Algo Capital DAO has earned another 12,250 $SFX for a total of 32,250 $SFX tokens.
You can read an interview with Stabull's BoD member on our Substack: link
