Authors: @metaproph3t (Co-Founder, MetaDAO) and @metanallok (Co-Founder, MetaDAO)

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Summary

If passed, this proposal will enable Zinc holders and the Zinc’s founder to in effect take ZKFG private at a price of $0.15 per outstanding ZKFG.

Specifically, if passed this proposal would:

• Authorize the creation of an escrow account that can receive USDC and ZKFG.
• If sufficient USDC and/or ZKFG are received at this escrow account after 7 days to pay out 0.15 USDC per outstanding ZKFG, ZKFG would be wound down and all of Turbine Cash DAO LLC’s intellectual property would transfer to the Operator / Member of the LLC.
• If insufficient USDC and/or ZKFG are received at this escrow account to pay out 0.15 USDC per outstanding ZKFG, intellectual property would remain in Turbine Cash DAO LLC and there would be a special moratorium on ZKFG proposals for 90 days.

Motivation

ZKFG-006, requesting a liquidation at up to $0.15 per ZKFG, was approved by the market. However, the proposal had several flaws:

• It did not state that any IP rights should transfer and who would receive these rights
• It did not create any escrow to ensure that funds would be sufficient to cover its target price. This goes against MetaDAO’s policy on buybacks above NAV
• It didn’t actually contain any executable instructions – it only included a memo instruction that is not executable by the Solana runtime because it uses an EOA as the fee payer rather than the DAO

The above rendered ZKFG-006 not executable.

But its motivation still stands. ZKLSOL now has two tokens: ZKFG and ZINC. It’s quite possible that this could confuse users and hurt ZINC’s prospects. It is reasonable for the market to consider an offer to buy out ZKFG holders and sunset the token and take its IP private.

Logistics

Escrow

One of the issues in ZKFG-006 is that no one could guarantee that there would actually be $0.15 in USDC per outstanding ZKFG.

To solve this, we’ve created a 2/3 escrow: Di7ZrctEeNupFaXFBoFBDzf4Ubh1FKxnirfEyd8kSE8b.

If this proposal passes,

• Holders will have 48 hours posts the end of the proposal to send USDC and ZKFG.
• If at the end of 48 hours, there is sufficient USDC and/or ZKFG such that the DAO-owned-USDC (including any USDC in its treasury & across AMMs) plus the USDC in escrow divided by the DAO-owned-ZKFG plus the ZKFG in escrow is greater than or equal to 0.15, the liquidation will proceed.
• If at the end of 48 hours, there is insufficient USDC and/or ZKFG to meet this condition, all USDC and ZKFG will be sent back to their senders. Spam transactions (those containing less than ~$1000 of value of either ZKFG or USDC) may or may not be reversed, left to the MetaDAO team’s discretion.

IP Transfer

If liquidation proceeds, all IP will be transferred from Turbine Cash DAO LLC to the Operator / Member of the LLC.

The Operator / Member of the LLC would also have authorization to close down Turbine Cash DAO LLC.

Cash Liquidation Process

If liquidation proceeds, all ZKFG holders would be able to redeem each ZKFG for 0.15 USDC for at least 365 days post-liquidation. We would expect to have this live on Solana and on metadao.fi within 1 week of the time that we determine that there is sufficient USDC and ZKFG in the escrow.

MetaDAO would have discretion over remaining unredeemed funds at this point, which could for example mean returning the remaining funds pro rata.

If the ZKFG and/or USDC amounts put the liquidation above the 0.15 USDC per token the USDC amount would be returned pro-rata to the funder.

Non-Liquidation Case

In the event that this proposal passes and the ZKFG and/or USDC in escrow at the end of 48 hours is insufficient to pay 0.15 USDC per outstanding ZKFG, ZKFG will not be liquidated and will instead enter a special moratorium.

This moratorium would have the following conditions:

• No valid proposals could be made for 90 days, except for those introduced by either the Turbine Cash or MetaDAO teams.
• All IP would remain in Turbine Cash DAO LLC.
• 70%+ of net revenue - whatever remains post ZINC buybacks and mining payouts - would be expected to flow into the Turbine Cash onchain treasury, with 100% of net revenue flowing into either the onchain treasury or Turbine Cash DAO LLC (with the DAO LLC able to make operational payments, and to continue using its spending limit)

This moratorium is intended to give the Turbine Cash / Zinc team some breathing room to execute and to give tokenholders some more time to evaluate Zinc’s prospects.

Important Accounts And Information

• Treasury: BNvDfXYG2FAyBDYD71Xr9GhKE18MbmhtjsLKsCuXho6z
• Meteora LP: DZc1Smsn5n7TCEDyivJs61dPzJem2661fnvYw2ZEMJFa
• LP Position: 5FPGRzY9ArJFwY2Hp2y2eqMzVewyWCBox7esmpuZfCvE