Loan Scheme

[orishim]

This spec came out of conversations with Eric Arsenault.

Overview

A scheme for DAO debt financing where

• Repayments are pre-scheduled and automated
• Debt shares are tradable
• Debt share holders continuously receive pro-rata fraction of repayments

Loan Scheme Flow

1. DAO initiates debt offering. If the proposal passes, a new debt contract is created.

   ProposeDebtOffering (
       Min - Max Principle:	$75k - $100k DAI
       Offering Time Window:	Jan 15 - 31, 2020
       Repayment Frequency:	Monthly
       Repayment Term:	        24 months
       Interest rate		15%
   )
   

2. During the Offering Time Window, anyone can send funds to the debt contract and receives equivalent amount of erc-20 debt shares. If the soft-capped is reached, funds are transferred to the DAO and repayment period begins.

3. Repayments are automatically transferred from the DAO treasury to the debt contract according to the repayment frequency and term (e.g. Monthly for 24 months)

4. Debt share holders can claim their accumulated fraction of repayments from the debt contract at any time. They can also freely transfer these tokens. (dOrg implemented similar functionality in the bc-dao project)

[arsena21]

Just pointing out that this sort of scheme could solve some of the financial challenges facing Genesis DAO:

-currently, members of the DAO receive funding via proposal. However, it is often the case that these proposers are not able to withdraw funds from Genesis (if there are not enough funds).
-this type of scheme could pay these people in advance, and allow them to get funds out to start development, which would be very useful.

[ellielo]

Interest rite of 15% is a bit high on my opinion. Is it only me?

[XelaAl]

Interesting info. I got a loan by link once when I faced some financial issues. It was short-term and I paid it off quickly. But honestly speaking, I've never thought about the loan scheme. Thanks for the detailed explanation!