At time of writing, the Ribbon Multisig is sitting on ~$70M  worth of RBN tokens. We propose to raise cash for working capital by collateralizing $RBN and issuing bonds against it through Porter.
We are working with Porter Finance to issue and sell to lenders $3M of convertible bonds  backed by $15M worth of $RBN collateral. The exact amount issued will depend on the interest rates at auction time, but we are targeting up to $3M. There are a number of uses for this working capital: protocol owned liquidity, bootstrapping the stablecoin supply in our covered call Fuse pool , or undercollateralized lending through Maple Finance .
The call strike will be 3x the market price at issuance.
We expect a 3-4% net borrow APR for the cash raised since the 7% borrow APR and Porter’s 1% service fee will be offset with 5% in Porter tokens through their liquidity mining program. Since the token has not launched, we will receive IOU’s redeemable for the Porter token at a later date in the future.
The goal of a DAO is to maximize long-term token holder value. Issuing bonds backed by RBN allows us to increase our working capital, without giving up equity, to aggressively improve our protocol through off-chain and on-chain activities such as protocol-owned liquidity, increasing stablecoin supply in the covered call fuse pool, or earning yield for a rainy day.
We are scheduled to collateralize $15M in RBN and raise up to $3M in stablecoins late May / early June.
This proposal will be posted on the forum for 1 week prior to voting. Voting will then be open on Snapshot for 5 days. This vote will be a single choice vote. You may vote on the proposal by selecting “Yes, let’s do it” or “No, this is not the way”.
We are postponing the snapshot until we finalize bond issuance details with Porter Finance.