How Can a Decentralized Autonomous Organization (DAO) Execute a Rapid, Emergency Token Auction?
A DAO can use a pre-approved, immutable smart contract that is only activated by a super-majority or emergency multi-sig vote. This contract automates a Dutch auction or a fixed-price sale of new tokens for stable assets, bypassing the normal, slow governance process.
This allows for rapid recapitalization to cover the deficit before the situation worsens.
Glossar
Rapid Recapitalization
Objective ⎊ Rapid recapitalization is the strategic objective of swiftly injecting sufficient new capital into a crypto derivatives or lending protocol to restore its solvency and cover any existing unbacked liabilities or bad debt.
Dutch Auction
Mechanism ⎊ A Dutch auction is a pricing mechanism where the price of an asset starts at a high level and systematically decreases over time until a bidder places an order at the current price.
Decentralized Autonomous Organization (DAO)
Governance ⎊ Decentralized Autonomous Organizations represent a novel framework for organizational structure, leveraging blockchain technology to enact rules encoded as transparent computer programs.