October 2022 Financial Report
Intro
The month of October has been an amazing month for Honey DAO. With the official launch of our first lending market (and all that comes with it) we have finally started to generate profit. However, it should be understood that we have lowered the protocol fee to allow for more growth and testing, so our profits aren’t at their maximum.
Throughout this month we have also had major developments across our protocol infrastructure as a whole. This includes having our governance page deployed on beta (https://beta.honey.finance/governance), the approval of HIP#4, launching Questive with the community (https://tinyurl.com/2pwy5ek8), and having our community grow the Tensorswap pools to help with liquidations and market making on our Bee NFTs (https://tinyurl.com/bddubmmb).
Overall our protocol has truly developed going into Q4, with lots in the pipe coming out till the end of this year. This will be especially interesting as protocol fees get reinstated, permissionless markets begin popping up, and the ecosystem as a whole develops around the Honey protocol.
I’m especially looking forward to growing the profit page as we move through Q4 ;). Now let’s dive into the details…
Monthly Breakdown
Over this month we have been unable to keep our expenditures down. This is due to many factors, especially the finalization of our auditing process on Solana.
As the auditing comes to its conclusion, and we have the features rolled out, our expenses will decrease to the 100k a month target that we venture to hit.
However, with the need to attend more events such as breakpoint Honey will see its marketing budget increase to allow proper growth. This would be measured with user count increases as well as partnerships with other protocols and DAOs.
Here we can see the chart and graph for a rounded breakdown of costs this month for the different roles.
We are working on continuing to expand the communications department as we move towards a period where growth is going to become more and more important.
As our product comes to its final stages of development, it becomes increasingly important for us as a protocol to grow in market share and TVL. This will be our priority for the end of Q4 going into Q1 of next year. In doing this we can generate more revenue from fees which in turn expands the runway. These next two quarters are essential to the success of Honey.
For the next portion of the report, I am doing a deep dive into the breakdown of the DAOs holdings and our updated runway projections.
Here we have a list of all the wallets attributed to the DAO. We have bridged a majority of DAO funds from the Solana network to the Etherium and Polygon wallets.
https://twitter.com/theSailor__/status/1593289309934723073?s=20&t=-NXyI1ltr3Y0xI3--cRFAA
The liquid runway is everything noted above, except honey (as this is relatively illiquid and does not count as “liquid runway” by my standards. The DAO currently has >1 Million USDC in its treasury.
We can compare this to two months ago in August when it was 1.5 million. The expenditure can be roughly broken down as such:
- 250k for contractor expenses
- 120k for auditing expenses
- 50k on deployment fees, bridging fees, Legal fees, Design fees
Below we see a projected runway analysis with different expense estimates and how long that burn rate would last us without any profits. I took an average of 27k per week for our current burn rate as this is what it hovers over.
As we see, the Honey DAO currently has 9 months of runway at current burn rates, if we didn’t have any profits.
Profits
Our profits this month have only come from liquidations as we have lowered our protocol fee to 0% to incentivize users to use our markets.
Therefore the 0.47 Sol marked in the fee wallet is from liquidations alone, for which we’ve had two liquidations for the Honey Genesis market (the only market available).
This section will continue to develop as our protocol fee returns and our protocol continues to develop.
Looking to the Future
What can we look forward to while closing out Q4? With the deployment of permissionless markets, multichain integration, HIP#4, and much much more, these two coming months are going to be a critical time for the Honey DAO.
Make sure to follow our Twitter and join our Discord to follow the work we are doing. And feel free to shoot me a DM on any platform, I’d love to discuss the financials with anyone who has any questions.
When will the next report be out?
We at the team have decided to come out with more articles and a newsletter for more Honey content in the coming months(more on this to be announced soon). This paired with the fact that monthly financial reports seem to be quite excessive and does not allow for us to collect much data (depending on the month) we have decided to move the financial reports to a quarterly basis with the next one coming out in January.
Have a wonderful couple of months everyone and keep on Buzzing,
theSailor ⛵️🍯
