Governance
Navigating the Branches of Balance
Circularity Finance (CIFI) has constructed a complex governance system with a clear separation of powers to ensure that its ecosystem operates efficiently and is driven by its stakeholders.
This structure is divided into three primary branches: the CIFI DAO, the Real World Asset (RWA) DAO, and the REFI DAOs. Each plays a unique role in maintaining the stability, growth, and forward momentum of the platform.
CIFI DAO: The Executive Branch
Membership Structure:
Governor Seats: To become a member of the CIFI DAO, one must acquire 100,000 CIFI tokens to purchase a Governor membership.
Exclusivity: A maximum of 250 memberships are available, ensuring an elite and dedicated governance body.
Responsibilities and Benefits:
Oversight: The CIFI DAO has monetary policy oversight and reaps benefits from the ecosystem's growth, receiving monthly rewards and quarterly dividends.
Stability Maintenance: Members are tasked with stabilizing the platform by liquidating under-collateralized loans, thus protecting the ecosystem from volatility.
ETF 3 Creation: The CIFI DAO is responsible for creating ETF 3, an internal Money Market Fund, through the acquisition of liquidated assets. This fund generates yield for the Governors and is exclusive to their participation.
Default Mechanism: If Governors do not perform liquidations, the protocol auto-liquidates to the open market to maintain stability.
RWA DAO: The Investment Branch
Membership Structure:
Investor Seats: Membership to the RWA DAO requires an investment of 10,000 CIFI tokens.
Expansion Potential: The RWA DAO is capped at 500 memberships, balancing accessibility with focused investment power.
Investment and Exit Strategy:
Asset Management: The RWA DAO manages 5 million CIFI tokens for RWA investments and acquires Governor Seats to exercise influence and manage investments.
Exit Option: Members can exit their positions by selling their NFT membership back to the DAO using the "buy out fund", by doing this - enhancing the rarity and value of remaining seats.
Ecosystem Contribution: The RWA DAO functions as a sustainable agent, contributing 40% of the earnings from Governor Seats back into the ecosystem.
Buy Out Fund: The remaining 60% forms a 'buy out fund', offering liquidity to members wishing to sell their seats.
REFI DAOs: The Incubation Branch
Funding and Contributions:
Capital Raising: The price to join a REFI DAO may vary, but each aims to raise 5 million XDC.
Ecosystem Support: 20% of the funds raised contribute to liquidity pools as the platform expands into new blockchains.
Asset Management: The remaining 80% is managed by the REFI DAOs to invest in and support the growth of the regenerative finance ecosystem.
Sustainability and Certification:
Sustainability Services: REFI DAOs can fund the Sustainability Designation of companies, collaborating with the Green Cross UK and other entities to assess and certify sustainable practices.
NFT Issuance: The culmination of a company's sustainability journey is the issuance of a REFI NFT, symbolizing its status and eligibility for DeFi benefits and other advantages for sustainable practices.
The governance model of Circularity Finance is an intricate balance of power and responsibility designed to drive collective decision-making and sustainable growth. The CIFI DAO acts as the executive force, ensuring platform stability and financial governance; the RWA DAO takes on the role of an investment body, managing real-world asset integration; and the REFI DAOs operate as incubators, fostering regenerative finance initiatives. Together, these branches form a robust, decentralized governance system that aligns with the principles of transparency, accountability, and stakeholder empowerment central to the CIFI ethos. Through this system, Circularity Finance not only directs its present operations but also paves the way for a sustainable, decentralized future.
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