How Does a DAO Execute a Large-Scale Diversification Trade without Crashing the Market?

The DAO typically executes an Over-The-Counter (OTC) trade with an institutional counterparty or a specialized market maker. OTC trades are conducted privately, off-exchange, minimizing market impact and slippage that a large on-chain swap would cause.

The DAO can also use a series of small, time-weighted average price (TWAP) sales to gradually liquidate the tokens over a long period.