We are proposing that we use 50 ETH (~10% of our ETH holdings) to repurchase PRINTS tokens from willing sellers.
There are two main drivers:
As we move towards potentially providing liquidity for the PRINTS token, this will help establish a clearing price and create price stability for the token. We learned through our experience providing liquidity for the RAW token that both of these things are extremely important for maintaining a healthy and stable liquidity pool.
PRINTS tokens are currently inexpensive, and buying them back for the DAO should be accretive to value for tokenholders.
To execute the buyback, we’d propose hosting a reverse sealed bid auction for a limited period of time. During this period of time, any holder of PRINTS will be able to submit an offer to the manager of the auction via DM, with their own proposed price and number of tokens. The manager of the auction will, at their discretion, accept the most favorable offers at any given time on a first come/first serve basis (eg. lower priced offers will be accepted before higher priced offers). Accepted offers will receive a response DM with an Airswap link to execute the trade.
Looking for feedback and comments from the DAO as well as from members who might be interested in participating as sellers.
Think this makes a lot of sense.
Make sense and I agree. I don’t see a downside here.
Bumping this for visibility
Not in favour of this unless it incorporated a price cap that was a discount to NAV – otherwise it’s not clearly accreative to tokenholders.
Even with such a cap I’m skeptical it’s a good strategic move. We are in a bear market, we should be cautious with reserves – there’s no guarantee of raising more, at least not at a sensible valuation.
Thanks for the comment - we would definitely be looking to cap the price we pay below NAV in order to avoid any dilutive impact
I definitely think it makes sense to buy tokens considerably below NAV when possible.
What is the plan for these PRINTS once acquired? To sell when conditions are favorable? To use as payment for the new working groups?
I don’t think we necessarily need to have a dedicated use for them. They’ll likely sit in the treasury until used for any of those above purposes you mentioned.
The bigger factor for repurchasing them, to me, is to create stability for when we provide liquidity.
Having reflected further, I really don’t think this is a good idea.
Downside is a rather hefty 10% of our ETH reserves.
Upside is a small reduction in circulating supply – say we matched the recent 5ETH = 5000 PRINTS transacitons, we’re talking about taking 50k PRINTS back into the treasury. That’s tiny in both absolute treasury terms and in its likely impact on ‘price stability’.
Indeed, I’m not even sure what you mean by ‘price stability’. Istn’t this just simply providing liquidity at a price above market (OTC) to a few low-end sellers? I don’t get how that helps in the long-term.
If we were actively using PRINTS in compensation or similar then it could well be worthwhile, but we don’t yet have clear plans for this.
Have spent some time taking feedback from this thread as well as discussing with other members and I think we’ll reformulate this idea and come back with a different and updated plan. Thanks for the feedback everyone!