tranks

: : DUNA removes the risk of Uniswap’s fee switch execution For years, the primary obstacle was the lack of legal recognition for the DAO. Without a recognized legal entity, any move to turn on the "fee switch" carried risks: > Tax risk: Enabling the fee switch would generate tangible revenue for the DAO treasury. Without a legal entity in the United States, there is no taxpaying body, and every member could face potential tax and legal liabilities > Contracting and operational limits: Leveraging fee revenue to engage service providers, retain legal counsel, manage accounting, or open bank accounts requires a legal entity > Liability exposure: Without a corporate structure, individual DAO members are subject to unlimited liability, making it risky to adopt a revenue-generating model In response, the Uniswap Foundation has proposed adopting a Wyoming-registered DUNA (Decentralized Unincorporated Nonprofit Association) as the legal structure for Uniswap Governance. Through this framework, the proposed 'DUNI' would preserve Uniswap’s decentralized governance model while enabling offchain activities such as fulfilling tax obligations and contracting with service providers. So, what exactly is a DUNA? In short, a DUNA is a law passed by the State of Wyoming to recognize DAOs as legal entities. In March 2024, the Wyoming Decentralized Unincorporated Nonprofit Association Act (SF50) was signed into law. The bill is based on the state’s existing Unincorporated Nonprofit Association Act but is purpose-built for decentralized organizations. A DUNA addresses three core challenges faced by DAOs: > Grants legal existence, enabling them to contract with third parties and respond to lawsuits > Enables them to pay taxes > Protects members from liability for the actions of other members By providing a legal wrapper, a DUNA removes the risks associated with enabling the fee switch, giving the DAO a secure framework to receive and manage fee revenue in its treasury. Most importantly, it offers limited liability protection for governance participants, shielding them from potential personal legal and tax liabilities arising from collective decision-making. As a result, the prospect of Uniswap activating its fee switch and distributing a share of protocol fees to UNI holders (or stakers) is now clearer than ever. Today alone, Uniswap generated $1.5M in trading fees, and even directing a fraction of that amount to UNI holders would create meaningful value accrual. Of course, the proposal has not yet passed, and if approved, it would involve converting $16.6 million worth of UNI into fiat ($), potentially creating short-term sell pressure. Nevertheless, over the long term, DeFi is entering its most opportune period. With Lido currently discussing a buyback program, the path toward token value accrual for major DeFi protocols is becoming increasingly apparent. Once Uniswap and Lido begin fee sharing or buybacks, it is hard to imagine a scenario where other DeFi protocols would remain unable to return value to users due to legal risks. This is, quite simply, the new era of DeFi

Theo: RWA Volume Game Thesis When evaluating a protocol’s growth, TVL without capital efficiency is a vanity metric. From an accounting perspective, TVL itself is a liability, representing assets that must be redeemable to users at any time. The more important variable is how those deposited assets are managed and how efficiently they are used as capital. In other words, this is a volume game. Crypto has already entered the volume game. The evolution from Uniswap v2 to v3, and from GMX’s GLP to Hyperliquid, demonstrates that the market is shifting away from TVL toward capital efficiency and turnover. Ultimately, the decisive factor in value capture is how many transactions occur on the same capital base and how much fee income is generated from that activity. Viewed through this lens, the same transition is inevitable for the RWA market. To date, RWA development has focused almost entirely on bringing RWAs onchain. As a result, growth has been driven almost exclusively by issuance. However, issuance alone is not enough. It is now time to focus on how tokenized assets are traded, settled, and monetized. In this process, the RWA market will also begin to recognize trading volume as the core metric, signaling the true entry into the volume game. This naturally leads to the next critical question: just as Uniswap v3 and Hyperliquid redefined capital efficiency and liquidity in DeFi, which RWA platform will be best positioned to capture the largest value flows through liquidity-centric design? In the context of the volume game thesis, the player I am most focused on is @Theo_Network. 1. Problem and Vision: Going Beyond the Issuance The reason the RWA volume game has yet to work lies in liquidity constraints: 1.1 Redemption Delays Even when looking only at tokenized T-bill products, investors face multiple limitations that restrict the agile use of capital. Although 24/7 trading is often cited as an advantage of tokenized assets, actual redemption structures fall far short of that expectation. In practice, these products fail to fully leverage the flexibility and real-time capabilities of onchain finance, instead replicating many of the rigidities of the TradFi. As a result, investors encounter a structure far removed from real-time liquidity, creating significant barriers to using tokenized assets. 1.2 Secondary Market Liquidity Secondary market liquidity is also lacking. This stems from structural challenges in market-making for RWAs compared to crypto-native assets: > Liquidity sourcing burden for MMs In RWAs, sourcing liquidity for market-making is difficult. Pre-minting a large circulating supply requires upfront acquisition of the corresponding RWAs, which is costly and capital-intensive. > Inventory risk due to lack of hedging tools Onchain derivatives markets for RWAs either do not exist or are underdeveloped. As a result, MMs must bear full exposure to price volatility without effective hedging instruments. > Limited spread opportunities In the case of tokenized T-bills, prices are typically updated once per day based on a fixed NAV. This limits the ability of MMs to adjust bids and offers in real time and capture spread-based profits. Because these liquidity issues remain unresolved, the growth of the RWA market is still nascent. BlackRock manages over 100 times more capital than the entire onchain finance ecosystem, and of the $28T T-Bill market, only about $7B has been tokenized, representing just 0.03% of the total. Theo’s vision lies here: to go beyond merely issuing RWAs and establish a clear plan to restructure the market around post-issuance liquidity. 2. thBILL The first milestone in this vision is thBILL: thBILL is an asset that tracks T-bill yields, composed entirely of tULTRA, a money market fund backed by T-bills. It has been deployed on @ethereum, @HyperliquidX, and @arbitrum, with further expansion planned. Theo’s defining feature for thBILL is the introduction of Optimistic RWA Minting, which allows RWAs to be minted instantly at block-level quotes, with settlement handled on the backend. This enables MMs to mint RWAs in real time based on per-block pricing, reducing settlement friction costs in the RWA market. 3. Team To realize its ‘Going Beyond Issuance’ vision, Theo has assembled a team with the capabilities to execute it. The founders come from global trading houses such as Optiver and IMC Trading, with deep experience in HFT and market making. They have first-hand expertise in running liquidity provisioning algorithms, managing position risk, and understanding capital efficiency at a level few others possess. Furthermore, Theo deals with regulated RWAs such as T-bills, MMFs, equities, and commodities. Handling these assets onchain requires not only regulatory alignment but also trusted relationships with asset managers and custodians. Leading this effort is Theo’s CIO, @iggyioppe, whose background includes Bain Capital, Credit Suisse, and hedge funds, as well as co-founding Location Labs, which was acquired for $220M in 2014. 4. Looking Ahead: Can Theo Create a Hyperliquid Moment for RWAs? When considering the ideal case for the volume game, Hyperliquid stands out as a clear example. So, what drove Hyperliquid’s competitive advantage? Distilled into two differentiating factors, it comes down to: > Liquidity: Delivered superior execution through a deep order book and ultra-fast matching engine. > Trading Volume: Generated a stable revenue stream supported by large-scale trading activity. While simple to state, these advantages are difficult to replicate, creating a durable moat and setting a new standard in the perpetual futures DEX sector. Theo’s playbook in the RWA market follows the same pattern: > Make RWA trading more accessible through deep liquidity and issuance/settlement infrastructure optimized for RWAs. > Build a stable value accrual model on the foundation of active RWA trading. In short, Theo aims to meet both pillars of strong market competitiveness demonstrated by prior success stories, setting a new benchmark for the RWA market. From the perspective of reengineering RWA trading for the volume game, Theo can be compared to a Hyperliquid moment. Given these factors, Theo is clearly positioned to succeed in achieving such a moment.