[Democracy] Public proposal for Astar Finance Committee (AFC)

Forum discussion link: https://forum.astar.network/t/introduction-of-astar-finance-committee-afc/8374

TL:DR;

The DAO Allocation currently lacks clear ownership. By transferring this allocation to a newly established Astar Finance Committee (AFC), AFC can actively utilize the resources to support strategic growth and strengthen the Astar ecosystem.

This proposal has already been shared with the following groups for initial feedback:

• Astar Community Council (March 24th, 2025)
• Astar Agents (April 2nd, 2025)
  

Background

Over the past 12 months, the Astar ecosystem has faced several challenges, including sustained sell pressure and limited strategic intervention. At the same time, Astar is well-positioned within the growing Soneium ecosystem—an opportunity that can be leveraged to overcome these structural issues and revitalize the ecosystem. However, the current absence of non-native assets in the treasury limits the ability to offer diversified and sustainable incentives. As a result, incentive recipients often convert $ASTR rewards into cash, which reinforces the sell pressure and diminishes the long-term effectiveness of incentive programs.

Establishment of the Astar Finance Committee (AFC)

To address this structural limitation, the Astar Foundation proposes the Astar Finance Committee (AFC) as a dedicated body to receive and utilize the DAO Allocation for generating sustainable revenue streams, accelerating ecosystem growth, and ensuring long-term value returns to the Astar ecosystem. The AFC will actively manage the grant from the DAO and implement strategic treasury operations, including mobilizing revenue from Layer 2 networks such as Soneium and the Superchain back to the Astar Collective.

The committee is proposed to be composed of a group drawn from the Astar Collective, with expertise across risk, growth, and treasury management. Based on prior experience, a 3-out-of-5 signature threshold is being considered for operations. To ensure responsiveness to market conditions, the AFC will operate on weekly or bi-weekly basis, sharing a minor report every month and a major report every quarter on the Astar Forum.

Possible Revenue Generation Strategies for Astar DAO

While specific strategies will be determined through discussions following the establishment of the AFC, the following approaches represent potential directions of AFC for revenue generation:

1. Provide $ASTR Liquidity on Lending Protocols
Supply $ASTR to lendings such as Untitled Bank and Sake Finance to earn yield and airdrops, while reinforcing $ASTR’s role as a primary currency within Soneium.

2. Provide Liquidity on DEXs
Utilize $ASTR in LST protocols (e.g., Algem, Astake, Bifrost, or Neemo) and create $ASTR/$ASTR LST pairs on DEXs such as Velodrome or Kyo Finance to generate yield.

3. Stake $ASTR on dApp Staking Projects
Stake $ASTR in selected dApps to increase staking TVL and receive additional $ASTR. For example, the AFC could select five projects and stake 25 million $ASTR in each, amplifying both on-chain activity and the DAO’s staking rewards.

4. Stake $ASTR on Other Protocols
Stake $ASTR on platforms like Ethereum L1’s Fast Finality layer to generate returns and earn future airdrops.

5. Partner with Experts for Optimized Yield
Collaborate with treasury managers (e.g., Gauntlet) to build customized and optimized treasury strategies.

6. Invest in Early-Stage Projects
Allocate capital to startups aligned with Astar’s vision through token swaps, grants for future tokens, or early investment in NFT sales and pre-seed rounds.

Possible Revenue Utilization Strategies for Astar DAO

While specific utilization plans will be determined by AFC considering various discussions, the following strategies outline potential ways AFC will deploy the revenue to benefit the Astar ecosystem.

1. Burn $ASTR
Burn a portion of $ASTR earned from staking or liquidity provision to support tokenomics and mitigate inflation.

2. Buy $ASTR
Use non-$ASTR revenue to buy back $ASTR from secondary markets. All buybacks must be conducted in a transparent manner to ensure compliance with MiCA and SEC regulations. The repurchased tokens can be burned or restaked for additional returns, based on future decisions of AFC.

3. Diversify the Treasury Portfolio
Hold alternative assets such as BTC, ETH, or stablecoins to reduce volatility risk and expand Astar DAO’s strategic reach. The future usage of earned $ASTR can be determined later through AFC's decisions. One potential direction is to allocate this capital to high-growth startups building within the Astar ecosystem, either through direct investments or strategic partnerships.

Technical Implementation Details

To ensure a structured and transparent launch of the Astar Finance Committee (AFC), the following implementation steps are proposed.

AFC Formation
A committee will be formed through multisig operations, composed of representatives from key ecosystem stakeholders:

• 2 members from the Astar Foundation
• 1 member from the Community Council
• 2 members from the Astar Collective

AFC Member Application Process
A new forum category will be created to facilitate the AFC application process. For a one-week period, any qualified member of the Astar Collective may apply to join the committee. Applicants should demonstrate strong financial expertise and a solid understanding of treasury strategy. All applicants must disclose any affiliations with specific projects to ensure neutrality. The Astar Foundation will review all submissions and may conduct interviews with select candidates. Any member of the Astar Collective may ask questions to the applicants during the application period. AFC members will receive compensation for their work, with the budget allocated from the onchain treasury with an onchain treasury proposal. Once the final members are confirmed, each will be provided with a hardware ledger through official vendors. To ensure transparency and security, an audit will be conducted during the unboxing and setup process.
In addition to full members, a small number of observers will also be selected. Observers are non-voting participants who may attend AFC sync meetings.

DAO Allocation Transition
The Astar Foundation and AFC will be authorized to establish the necessary legal and operational structure for AFC to receive the grant and to execute token burns, buybacks, and strategic investments in a compliant and transparent manner.

Evaluation Process
The committee will hold weekly or bi-weekly calls to discuss ongoing strategies and operational matters. To ensure accountability and transparency, the AFC will publish a minor report every month to provide updates on key initiatives. In addition, a major report will be released every quarter to summarize significant actions and current outcomes, including the yield earned and the amount of ASTR that was buybacked or burnt. All major activities will be shared with the Astar Collective, both for transparency and for historical recordkeeping. Furthermore, all multisig wallets and their transactions will be made publicly accessible to allow real-time tracking of treasury operations. Following the initial phase of operations, the multisig structure and overall performance of the AFC will be reviewed. If any member is found to be inactive or not fulfilling their responsibilities, the member will be removed and application process will be reopened to fill the position.

Strategy Execution
The AFC will be granted a portion of the treasury to be utilized across other blockchain protocols, delegate assets to qualified partners, and invest in projects that align with Astar’s long-term vision. Additionally, the grant (and returns from the grant) can be used to burn $ASTR, purchase $ASTR from secondary markets or through market-making partners, and transfer the acquired tokens to the ecosystem reserve. All operations conducted by the committee will be executed in real-time with cameras turned on and backgrounds disabled, ensuring full transparency.

Next Steps

The community’s input is essential to shaping the future of Astar. Feedback on this proposal is welcomed—from Collective partners, DAO contributors, and individual holders alike.

Now is the time to turn untapped resources into sustainable revenue, unlock new possibilities for ecosystem growth, and Make Astar Great Again—together!