A group of activist investors (or "treasury raiders") is targeting GNO token holders with a proposal for a treasury redemption plan.
GIP-150 proposes a one-time, voluntary, pro-rata treasury redemption. If passed, participating holders would share proportionally in a portion of Gnosis DAO's treasury reserves, which exceed $220 million.
The proposal comes less than six months after Gnosis DAO voted to remove its former treasury manager, KPK. The proposer, Wismerhill, stated that the market price of GNO has long been trading at a discount to Gnosis DAO's net asset value, and this discount has been widening.
He added that despite the DAO recently allocating $22.5 million to Gnosis Ltd, the discount of the token relative to net assets has only increased further, with GNO capturing minimal value accretion.
Voting on the proposal is now open and will close on May 12. Although support initially led by a significant margin, of the roughly 330,000 votes cast so far, 65% are currently against.
The redemption amount would be calculated pro-rata based on 1.3 million eligible GNO tokens, excluding tokens held by Gnosis Ltd. The proposal justifies this by stating that this entity already receives long-term financial support from the DAO.
Based on this calculation, the redemption value per token would be approximately $170, nearly 30% higher than GNO's current market price of $131.
Reactions from the DeFi Community
DeFi commentator and GNO holder Ignas admitted, "There's some logic to this RFV narrative," but also pointed out that "this is purely an arbitrage play, hardly an ethical one." He has voted against the proposal. (Note: RFV stands for risk-free value.)
Ethereum Foundation DeFi Lead ivangbi holds a similar view. Since Gnosis never marketed its treasury assets as a backstop for the token price, holders have no ethical right to claim a share of the treasury.
Many others, considering Gnosis's contributions to the ecosystem, also disagree with the proposal. Gnosis is the entity behind key infrastructure projects like Safe, CoW Swap, Gnosis Pay, and Gnosis Chain.
Gnosis founder Sebastian Bürgel asked pointedly, when did the ecosystem's most respected builders become targets for hedge fund harvesting? Jito ecosystem lead Nick Almond directly characterized the proposal as a blatant treasury dump-and-run.
Anthony Leutenegger, representing the Aragon team which faced a similar attack in 2023, offered a more nuanced perspective. He called for the industry to improve mechanisms for programmatic token holder rights to better align incentives and resolve such disputes.
Previous RFV Attack Cases
This group launched several similar treasury arbitrage campaigns in 2023, earning them the label "RFV raiders" in the industry, a term the group itself rejects.
Projects targeted that year included Rook, FEI/Tribe, and Aragon. Aragon was ultimately forced to restructure its treasury usage, converting it into an ecosystem grant funding program.
Just recently, when Beefy Finance's token BIFI fell below its treasury net asset value in April, the DAO quickly launched a buyback mechanism precisely to avoid a surprise arbitrage attack by RFV forces.
Regarding the current Gnosis situation, the proposer Wismerhill previously stated that he has always admired Gnosis DAO and predicted that after removing KPK, Gnosis would make more commercially-driven decisions.
This ongoing vote will ultimately test whether GNO holders value short-term commercial arbitrage gains or long-term ecosystem building value more.
