GSR: Most DAOs concentrate about 70% of their treasury assets in native tokens, or form negative feedback

GSR's latest report indicates that most DAOs in the crypto industry have structural defects in treasury management, with about 70% of treasury assets concentrated in the project's native tokens.

GSR states that this asset structure may create a pro-cyclical negative feedback loop: when the price of the native token falls, the value of the treasury shrinks, while protocol revenue and market activity are affected, further increasing the financial pressure on the project.

Project teams typically seek to hedge only after the token price has dropped, but by this time, the market's implied volatility has often risen, significantly increasing the cost of risk protection.

GSR suggests that DAOs should separate operational reserves from long-term token holdings and consider using collar strategies to build downside protection, reducing the impact of market declines on the treasury and extending the project's funding usage cycle during bear markets.

GSR believes that in the short term, more projects adopting hedging strategies may drive growth in trading volume in the crypto options market, but the impact on spot prices is limited; in the medium term, if the structure of DAO treasuries improves, it is expected to reduce systemic selling pressure in the market.