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GIP-143: Should the GnosisDAO Terminate karpatkey Treasury Management Services?
Executive Summary
This proposal seeks to terminate karpatkey’s treasury management services for GnosisDAO, effective immediately from the passing of this proposal, with a 14 day transition period. No further payments are to be made to, nor retained by, karpatkey.
In Favour
Make no changes
0voters
Note: Votes are public given the large amount of karpatkey employees on the forum.
Motivation
Following extensive community discussions over the past weeks regarding treasury management performance, cost, risk exposure, and alignment with DAO objectives, this proposal formalises the decision to conclude karpatkey’s engagement as GnosisDAO’s treasury manager.
Specification
Action: Terminate the treasury management agreement with karpatkey effective immediately
Timeline: 14-day transition period from proposal passing
Transition: karpatkey to provide complete handover; documentation of all positions, strategies, and access controls within 14 days
Assets: All GnosisDAO assets under karpatkey management to be returned to direct DAO control and withdrawn from any karpatkey affiliated product (i.e. kpk Morpho vaults, kpk vaults). Where there is difficulty in handing over positions due to edge cases in allocation, ETH denominated positions may be converted to wstETH and USD denominated positions may be converted to sUSDS/sxDAI in order to hand them over.
Upon receipt of the assets, GnosisDAO representatives will begin the process of converting all treasury assets to sUSDS, wstETH, and Gnosis Ecosystem tokens before engaging in next steps regarding the treasury strategy.
Implementation
Revoke all Safe signer permissions held by karpatkey team
Transfer all assets to GnosisDAO-controlled addresses
Document all active DeFi positions for orderly unwinding
Cease all new treasury operations immediately upon proposal passing
Milestones
N/A
Note: Given the clear community interest expressed in recent forum discussions, this proposal moves directly to Phase 2 temperature check.
I find it truly amazing that Gnosis continue to engage with active treasury management when they are the creators of automated / protocol based products such as CoW Protocol and Safe, proving that they have (or at least had) the engineering capabilities to alleviate themselves of the need for said active treasury management. KPK are taking no liability on treasury management, besides just opportunity cost for themselves, which skews behaviour at best towards rent seeking (fixed fee), and at worst towards risk taking behaviour. If we’re talking no liability, sounds ideal for a faceless smart contract that has similar levels of communication as that which exists under KPK management, with no KPK fees.
Having worked at karpatkey for 1.5 years and now at Gnosis, I have a strong personal bias, so I will refrain from commenting on this proposal. I will note, however, that they manage the Gnosis DAO treasury on Gnosis Chain, which represents a significant portion of the existing liquidity. A two-week timeline may be reasonable for transitioning Mainnet funds, but if karpatkey were to step away, a longer transition period would be required. If this proposal passes, I suggest opening an RFP process to select who should manage liquidity on Gnosis Chain. Only once a new manager is chosen should karpatkey be fully replaced.
Understood. That is perfectly fine; the proposal can be amended to stipulate that mainnet funds are handed over in full, and the Gnosis Chain portion of the treasury enters an ongoing ‘handover state’ that requires all non-liquidity funds (including out of range liquidity) to be handed over, and the remainder to be managed by karpatkey purely for liquidity provision purposes until a new liquidity management agreement is put in place with an alternative provider.
In the event that karpatkey would prefer to disengage immediately following a successful vote rather than engage in this handover state, then all active liquidity on Gnosis Chain should be moved to full range Uni v3 positions while selecting a new liquidity manager via an RFP process.
Two minutes of read time, one resurrection. Nothing like a proposal against you to rediscover the forum login. Welcome back from March 23! And yes every vote against is straight from kpk themselves.
Of course, I’m not here to defend kpk, but things need to be handled professionally
I think it would be more productive to start with a simple vote to signal the DAO’s desire to remove kpk from treasury management.
Then, it will likely take several months to list the essential services to take over, as well as the new ones to initiate. Once a consensus is reached on this list, we can figure out who will do what. Some things can be managed directly by the DAO; for example, there’s no reason to have a fund manager just to deposit DAI into Spark. Other services will need an entity behind them, like providing liquidity on CEXs, bridge liquidity, etc. For that, we’ll either have to hire people internally or put out a call for tenders.
I think it’s possible to negotiate a gradual withdrawal and a contract termination on good terms with kpk.
Wholeheartedly agree, but if you look at the kpk vote brigade against and new accounts being created I’m not sure we can expect too much from them.
Thankfully the poll is public, so their shameless behaviour is visible by everyone. Naturally they should abstain from such a poll rather than actively trying to skew it.
Most kpk accounts are literal employee bots, they have ZERO activity on the forum other than voting for and liking karpatkey proposals: kpk bots - Album on Imgur
The fact they do this openly without embarrassment speaks volumes.
While I generally understand the motivation of this proposal, I think concrete, measurable examples of what @0x6f2 said in the other thread should be outlined for voters to actually make an educated decision:
it’s a performance issue. You have underperformed, overcharged, and overexposed GnosisDAO to unnecessary risks.
Against what benchmarks?
You are unavailable to complete critical transfers for days at a time when they aren’t self-serving.
Post the examples
You barely, if at all, outperform the most basic passive benchmarks.
What are those and why are they valid?
Rushed decisions shouldn’t be made because of a wave of negative sentiment (even if seemingly justified)
sUSDS and wstETH are the benchmarks, it’s mentioned plenty of times in the posts.
I can indeed post the examples, but I’m slightly worried that it would compromise their efficacy - please chat with your senior colleagues until you are made aware of examples of ongoing efforts that have been recently delayed and interrupted due to kpk’s delay in making transfers. If not, you can either message me privately or I can post the examples publicly with the risks outlined above.
Why are sUSDS and wstETH valid? Because they are passive DeFi benchmarks that require very little risk oversight and underwriting, no active management, are extremely liquid, and carry no exorbitant fees.
Necessary and overdue decisions shouldn’t be delayed because of an overabundance of caution for caution’s sake.
@Karpatkey are you willing to disclose how many of the against votes are karpatkey staff or karpatkey-affiliated accounts? Spoiler: [spoiler]at least 18 out of 19[/spoiler]
If you’ll openly manipulate a forum poll about your own employment - where everyone can see you coordinate votes and birth new accounts - one can only imagine what you do when nobody’s looking.
Your public actions reveal your priorities: karpatkey’s payroll over DAO interests.
Thank you for working on this proposal. I want to share more context on the updated terms KPK shared here. These terms are the result of discussions between KPK and Gnosis LTD. They are trying to address the concerns, which were also shared here: overpaying for a service that has not been performing as expected.
In terms of the pricing, the fees paid for the services rendered are considered market rate with the expectation for a further price reduction in about a year, thanks to much-needed efficiency improvements.
In terms of performance, KPIs have been defined. If the KPIs are not met, the service should be terminated. In the instance of the underperforming EURe pool, KPK has paid GnosisDAO $100k in GNO as compensation.
While I am personally in favour of continuing with KPK under the new terms, there has to be consensus in the DAO on how to proceed. I expect a snapshot proposal, and I will personally withhold from voting.
While I agree with all the issues mentioned here, I can also see the motivation in KPK to improve and live up to the expectations of token holders. GnosisDAO is holding about 10% of KPK. I am in favour of fixing issues instead of terminating ventures. However, not indefinitely. I see this as the last proposal. Either it works out or it doesn’t.
Would be glad to agree to this, but till now I don’t see much effort leading in this direction. Repeatedly during the last years (!) I asked for more open communication, and the issue with the EURe pool could have been an example to show how @Karpatkey improves in communication with the DAO. But what I have seen regarding this don’t convice me at all (could have been communicated in Febrary or at least March, but they not even mentioned it in the minutes they post here, despite it have been a known issue).
There has been a long-standing communication and transparency gap with the community and the kpk. I see that long bureaucratic processes are playing a more significant role than producing constructive solutions to current problems, such as the latest Balancer pool failure. Criticisms regarding this and similar issues have been present in the forum for a long time. Of course, treasury management is a difficult and stressful job, and they are not developing monetary policy for GnosisDAO. This situation leads the community to ask the question, “what is the kpk doing?” However, regardless of the circumstances, it is the kpk’s duty to provide answers to these questions, solve any problems and provide master class transparency to DAO.
I view this proposal as a final wake-up call. I initially marked this proposal as “in favor,” but I have since chosen to remain neutral, hoping to see a light that the kpk will take action against the long-standing criticisms. I hope to see the kpk’s concrete action plan before the voting. Even if this proposal doesn’t reach the required majority, the kpk’s legitimacy will remain questionable. The only way to overcome this is for them to show a concrete plan.
I agree, if this really is able to wake up @Karpatkey I would be very pleased. A detailed post here about their perception of the past and a description how to move forward would be great, it could still make me change my mind. Untill this I will remain in favor of this proposal, despite the obstacles it might cause.
After reviewing the discussion and available information, my assessment is largely neutral regarding the proposal itself, but several objective considerations appear relevant. Public sentiment and on-chain data indicate that karpatkey’s performance has not been competitive relative to its cost structure. Historical fee schedules (particularly from 2021–2022) are not fully transparent to me, but current compensation levels—supporting a team of more than fifty people—combined with fees charged across other mandates, suggest a pricing framework that may not reflect the current market for treasury-management services. In other DAO engagements, such as ENS, fees appear disproportionately high given the simplicity of the managed portfolio.
A broader structural issue is that the industry has evolved significantly. The type of service karpatkey provides has become increasingly commoditized, and comparable professional services are now obtainable at lower cost. For example, within Arbitrum DAO, similar functions were procured at zero direct cost through a competitive RFP process. While that model may be unsustainable over the long term and creates its own risks of extractive behavior, it demonstrates that there is a wide spectrum of pricing and service quality in the market.
A balanced outcome for GnosisDAO would likely involve securing high-quality service at an appropriate price point. Achieving that requires a transparent RFP process that brings multiple qualified candidates into direct comparison, rather than defaulting to the incumbent without competitive evaluation. For this reason, initiating an RFP may be more productive than immediate termination, allowing the DAO to select the most capable provider through an open process.
There are also operational concerns that merit attention. Recent missteps around sDAI/EURe management, inconsistencies in reporting (e.g., continued inclusion of Aave and Lido despite questions from community members such as ACI’s Mark Zeller), and unclear metrics such as “DeFi Treasury Network,” “operational results,” and “DeFi results” raise questions about transparency and methodological rigor. The noticeable shift in karpatkey’s business focus toward risk-curation products and investment vehicles may also indicate resource diversion away from GnosisDAO’s mandate. Overall, the level of urgency, accountability, and communication observed does not appear aligned with the expectations typically associated with stewardship of a major DAO treasury.
Considering these factors, introducing an RFP seems like a rational path forward. It allows the DAO to re-evaluate service quality, pricing, and alignment, and ultimately to select the provider that best meets its long-term needs rather than continuing with the status quo.
