What is this about?

The discussion revolves around a proposal by TokenLogic to convert a portion of the DAO's Ethereum Treasury assets (wETH, awETH, and aEthWETH) into rETH, leaving a balance of 100 aEthWETH for ongoing DAO expenses¹. The motivation behind this proposal is the higher yield offered by rETH compared to the current assets. However, the choice of rETH over stETH/wstETH has been questioned by WintermuteGovernance and 0xkeyrock.eth, who believe the latter could maximize the yield from the DAO's ETH holdings ^3,5.

How is the community reacting?

The community's reaction is mixed. Jengajojo and MarcZeller (representing ACI) support the proposal, emphasizing the importance of decentralization and diversity of LSTs ^4,6. On the other hand, 0xkeyrock.eth and Michigan_Blockchain have raised concerns about the proposal, with the former suggesting that treasury management should prioritize optimized return ^7,10. Kene_StableLab and Kentphilly also support the addition of rETH to the DAO's holdings, despite acknowledging that stETH may yield better results ^8,9.

Why this is positive?

The proposal is seen as a positive move by some members as it optimizes risk-adjusted yield and promotes the decentralization of staked ETH. It also emphasizes the importance of diversifying the DAO's holdings, which is seen as a strategic move for the organization's long-term stability.

Why this is negative?

However, some members have expressed concerns about the proposal. They question the choice of rETH over stETH/wstETH and believe that treasury management should prioritize optimized return. There are also questions about the calculations regarding the additional yield generated by the ARFC implementation, indicating a need for more transparency and clarity in the proposal.