Treasury Management Agreement

1. Introduction

This Treasury Management Agreement (“Agreement”) establishes the policies and procedures governing the management, security, and allocation of funds within the BlockEstateDAO Treasury. The DAO’s treasury is responsible for maintaining financial stability, funding approved projects, distributing profits to token holders, and ensuring the long-term sustainability of the DAO ecosystem.

2. Objectives

  • Define treasury management responsibilities and governance.
  • Ensure secure and transparent handling of funds.
  • Establish rules for fund allocation, disbursement, and risk mitigation.
  • Implement financial oversight mechanisms and auditing procedures.
  • Maintain compliance with applicable regulatory requirements.

3. Treasury Governance and Oversight

3.1 DAO Treasury Oversight

  • The Treasury is managed under the authority of the DAO Board and Treasury Committee. Token holders do not have decision-making authority over financial or treasury matters but may provide input through DAO Improvement Proposals (DIPs) reviewed by the Board.
  • The Treasury Committee is responsible for fund allocation, liquidity management, and enforcing security protocols.
  • The committee reports to the DAO community through periodic financial disclosures and governance updates.

3.2 Multi-Signature Control

  • All treasury transactions require approval from multiple authorized signers under a multi-signature security model.
  • Signers are elected by DAO governance and are responsible for ensuring fund security and compliance with financial policies.

3.3 Transparency and Reporting

  • All treasury transactions are recorded on-chain and publicly viewable.
  • Quarterly financial reports are issued to DAO members, detailing income, expenses, liquidity reserves, and investment allocations.
  • Annual external audits may be conducted to ensure financial accuracy, security, and compliance with DAO governance standards.

4. Fund Allocation and Management

4.1 Treasury Revenue Sources

The treasury is funded by multiple revenue streams, including:

  • Real estate asset income derived from tokenized properties managed by DAO governance.
  • Staking and liquidity pool rewards generated through tokenized asset participation.
  • Transaction fees collected from DAO-related operations.
  • Community contributions, including grants, donations, and external investments.

4.2 Fund Disbursement Policies

Treasury funds are allocated based on governance-approved budgets for:

  • DAO operational expenses, including legal, development, marketing, and security costs.
  • Project funding, where approved proposals receive allocations through the DAO’s treasury governance system.
  • Profit distribution, where token holders receive profit distributions from DAO treasury reserves as determined by DAO governance. These distributions are not guaranteed and are subject to governance review.
  • Reserve allocations, where a percentage of treasury holdings is secured for liquidity emergencies and market downturns.

5. Risk Management and Security

5.1 Treasury Risk Controls

  • Treasury assets are allocated across stablecoins, native tokens, and real estate-backed assets to mitigate risk.
  • The Treasury Committee and DAO Board oversee liquidity management. Token holders do not participate in financial governance decisions.
  • DAO governance has the authority to pause smart contracts governing treasury funds in response to security threats.
  • Treasury access is strictly limited to pre-approved multisig signers and governance-controlled smart contracts.

5.2 Smart Contract Security and Audits

  • All treasury-related smart contracts must pass security audits before deployment.
  • DAO security teams regularly review and update contract security mechanisms.
  • Bug bounty programs are implemented to incentivize security researchers to identify vulnerabilities before malicious actors can exploit them.

6. Compliance and Regulatory Considerations

  • The DAO’s treasury operations must comply with applicable financial laws, including:
    • Delaware DAO LLC Act (U.S.)
    • Financial Conduct Authority (FCA) Regulations (U.K.)
    • Dominican Republic financial regulations (if applicable).
  • The DAO adheres to SEC guidance for utility tokens and complies with applicable financial laws while maintaining BESD’s classification as a utility token, not a security.
  • Legal counsel must be consulted before engaging in transactions involving tokenized real-world assets.
  • Any significant changes to treasury management policies must be approved through DAO governance voting.

7. Amendments and Termination

  • This Agreement may only be amended through a DAO governance vote, requiring majority approval.
  • In the event of DAO dissolution, treasury assets shall be liquidated and distributed according to a pre-approved exit strategy.
  • Any remaining assets must be allocated according to DAO governance-approved terms.