# Shifting Focus — From Rebases to Treasuries By [contentBittern6](https://paragraph.com/@contentbittern6) · 2022-05-08 --- Based on the numbers I’ve been crunching on the sector we may call “Rebase Tokens” or “OHM Forks” or “Reserve Currencies” — I will be shifting my focus on the types of crypto assets I analyze. I will be broadening my scope to basically any protocol that has a treasury of assets, of which rebase tokens would be included in that analysis. Here are some changes I plan on making as I adjust my Top 15: I get a lot of flack on Twitter, Discord, Medium, etc. for dissing high yields in rebase token projects. The only counter-argument I’ve heard that has any merit is the fact that APY is good for marketing and enticing people to invest in their protocol. While I can respect that opinion and have seen many people make a decent return by getting in early and getting out quick, and have equally seen rebase token projects crash and burn after lowering their APYs, I think this is harmful in the long-term for any project that is looking to build a long-standing community. People are blinded by the eye-popping returns one would have received if they got into Olympus DAO early and believe that it can simply be forked to create massive opportunity for those that get in early again. Unfortunately, the math does not lie, and while the documents for all of these projects refer to being a reserve currency “backed” by $1, all you need to do is multiply the circulating supply by the APY and runway and you’ll see that almost none of these protocols will have enough assets on hand to cover every token that is set to be printed with $1 each. HOWEVER- if rebase tokens ditch the APY and runway completely, the floor price changes drastically and actually creates way more stability. Right now, protocols are held hostage by their own APY and runways because they need to keep enough assets on hand to buy back their tokens if they crash down to a dollar. If you remove the APY completely, it then becomes always profitable to buyback protocol tokens when market cap drops below risk-free value. I can’t underpin this point enough. If a protocol always bought back its token at say 95% MC/Treasury Value ratio, it will always make money. If you factor in the worst possible scenario of everyone making the run on the bank and selling every token, the protocol will eventually own all outstanding tokens AND would have made a profit on the delta between that market cap and risk-free value. This doesn’t even factor in the potential growth from investing that treasury. Right now the APY/Runway are damaging to token-holders because of the inflation it creates. Massive amounts of tokens manufactured for $0 each eating away at the protocol-owned liquidity pool as rebases are sold, ruining everyone’s share of the pie and creating more volatility as the LPs dwindle away. NOTE: If a treasury wants to still have a small APY where the drip is slow enough where it wouldn’t damage the LP terribly, no points will be taken off. However excessive APY that can’t be recouped from LP fees will have negative points in my scoring system going forward. From now on, I will be giving MAJOR points to treasuries that invest in assets that I otherwise would be unable to access myself. This usually includes assets that are either too expensive or out of my reach because I don’t have the right connections. Great examples of this are Wonderland’s VC opportunity with Betswap and Squid DAO’s purchase of a few Bored Ape Yacht Club NFTs. I also think there is a ton of untapped opportunity with treasury-owned metaverse land that we’ve yet to see monetized. While I appreciate what Jack Dorsey does for Bitcoin, I think he’s going to be eating his words REAL soon as old-school VC firms are left in the dust by well-structured and fairly launched VC DAOs. THAT is what Web3 is meant to be and the results are going to be jaw-droppingly revolutionary. It’s one thing to invest treasuries in high-growth assets for your token holders. It’s another thing to share the spoils for those deemed most loyal. We are already seeing this now with part of the NFT sales from $SQUID DAO going to NFT holders and vesting token holders in the form of $ETH to claim. We’re also getting ready to see Betswap tokens from that VC opportunity get airdropped to $TIME holders. There are other ways treasury-backed tokens can reward their token-holders in non-inflationary ways. Primarily this would be in the form of token buybacks which creates scarcity and therefore raising the underlying token price. There’s also the possibility of airdropping treasury assets that DON’T include the protocol token itself (think Dividend). I think we’re also going to see some real neat opportunities where if you hold X amount of protocol tokens it gives you some kind of benefit with access to a metaverse asset like land. We’re too early for that one but I assure you, it’s coming. I have always disclosed in every article that I own $OHM $SQUID $TIME $SPA and $PAPA. My investment thesis on these are as follows: $OHM & $TIME: Olympus DAO & Wonderland Money are ran by some of the most talented and innovative DeFi personalities in the entire crypto ecosystem and both have a track record of rewarding their followers. They are the megacaps of treasury-backed tokens and they have the skills, relationships, strategy, etc. to build and ship for a long time coming. $SPA & $PAPA: These are purely value plays. I almost look at myself as an activist investor by owning these. Potentially troubled tokens that may have made some mistakes in the past, fallen victim to FUD warfare, with many people losing faith and selling their tokens at a loss and moving on. Yet the devs are still around, trying their best, learning from their mistakes. The projects are unlikely to be rug pulls and they trade at a major discount. If both of these tokens do what they should do and remove the APY, their LPs would become stable, and it becomes profitable for the devs, the token holders, and the protocol itself to buy all of their outstanding tokens up to their MC/RFV ratio. $SQUID: $SQUID is basically a combination of the two concepts above. They have one of the most innovative and highest growth-potential treasuries out there and have the added feature of NFT sales contributing to growth. They are also trading right around their MC/RFV ratio which would effectively be a floor price with massive growth potential should they ever drop their APY. Now that the scope of projects that I’d like to cover has expanded, I’m eager to hear what ideas you might have of additional tokens I should cover. The only requirement is that they have a protocol-owned treasury that is somewhat easy to measure, is invested into assets that are expected to grow in value over time, and that have at least one strategy that rewards their investors in a non-inflationary way. Bonus points for fair launches and doxxed teams. My Twitter and Medium are open. Shill away, degen frens. ~Bludex Disclosures: Nothing in this article should be considered financial advice. I hold $SQUID, $TIME, $OHM, $SPA, and $PAPA. --- *Originally published on [contentBittern6](https://paragraph.com/@contentbittern6/shifting-focus-from-rebases-to-treasuries)*