Treasury Management
Locale Network provides treasury management templates that City Chains can adopt for governing community funds. These are not built-in systems—each community configures treasury governance according to their needs and regulatory requirements.
Treasury Templates
The treasury structures described here are templates. Each City Chain implements treasury management according to their community's requirements, local regulations, and governance preferences.
Treasury Overview
What is the Treasury?
The City Chain treasury is a community-controlled fund that:
| Function | Description |
|---|---|
| Collects Revenue | Receives fees from protocol operations |
| Holds Assets | Stores community funds securely |
| Funds Development | Pays for protocol improvements |
| Supports Community | Grants, events, initiatives |
Revenue Sources
City Chain treasuries can accumulate funds from multiple sources:
| Source | Description | Typical Rate |
|---|---|---|
| Transaction Fees | Portion of gas fees | 10-30% |
| L{CORE} Fees | IoT attestation charges | Per attestation |
| Lending Spread | Interest from Locale Lending | 0.5-2% |
| Data Marketplace | Commission on data sales | 5-15% |
| Stablecoin Fees | Local currency transaction fees | 0.1-0.5% |
Governance Structure
Multi-Tier Approval
Different spending levels require different approval:
| Tier | Amount Range | Approval Required |
|---|---|---|
| Micro | < $1,000 | Single council member |
| Small | $1,000 - $10,000 | Council majority (3-of-5) |
| Medium | $10,000 - $100,000 | Community vote (simple majority) |
| Large | > $100,000 | Community vote (supermajority) |
Spending Categories
Treasuries typically allocate funds across categories:
| Category | Description | Typical Allocation |
|---|---|---|
| Infrastructure | Node operators, sequencer, storage | 30-40% |
| Development | Protocol improvements, features | 25-35% |
| Community | Grants, events, education | 15-25% |
| Emergency | Security reserve, incident response | 10-15% |
| Operations | Admin, legal, compliance | 5-10% |
Treasury Operations
Proposal Process
Treasury Proposal Flow
Submit
Proposal
Vote
5 days
Timelock
48 hrs
Execute
Funds sent
Proposal Requirements
| Requirement | Description |
|---|---|
| Clear Purpose | What the funds will accomplish |
| Detailed Budget | Itemized cost breakdown |
| Timeline | Expected duration and milestones |
| Success Metrics | How outcomes will be measured |
| Recipient Info | Who receives funds and how |
Streaming Payments
For ongoing expenses, treasuries can use streaming payments:
| Feature | Description |
|---|---|
| Continuous Flow | Funds released over time |
| Cancellation | Can be stopped if milestones missed |
| Transparency | Real-time visibility into payments |
| Automation | No manual intervention required |
Security Measures
Multi-Signature Control
Treasury funds protected by multi-sig:
| Action | Signatures Required |
|---|---|
| View Balance | Public |
| Micro Spend | 1-of-5 council |
| Small Spend | 3-of-5 council |
| Large Spend | Governance vote + 3-of-5 |
| Emergency Pause | 2-of-5 council |
Timelock Delays
All significant transactions have waiting periods:
| Transaction Type | Timelock Period |
|---|---|
| Council Spend | 24 hours |
| Governance Spend | 48-72 hours |
| Contract Upgrade | 7 days |
| Emergency Spend | 4 hours |
Spending Limits
Rate limiting prevents rapid fund depletion:
| Limit Type | Description | Typical Value |
|---|---|---|
| Daily Limit | Maximum per day | 5% of treasury |
| Weekly Limit | Maximum per week | 15% of treasury |
| Per-Proposal | Maximum single spend | 10% of treasury |
| Emergency Reserve | Minimum balance | 20% of treasury |
Transparency
On-Chain Visibility
All treasury operations are public:
| Data | Visibility |
|---|---|
| Balance | Real-time, on-chain |
| Transactions | All recorded on-chain |
| Proposals | Public during voting |
| Recipients | Addresses public |
Reporting Requirements
| Report | Frequency | Content |
|---|---|---|
| Balance Report | Weekly | Current holdings by asset |
| Spending Report | Monthly | All disbursements with purposes |
| Audit Report | Quarterly | Third-party financial review |
| Annual Report | Yearly | Comprehensive treasury review |
Grant Programs
Community Grants
Funding for community projects:
| Grant Type | Typical Amount | Purpose |
|---|---|---|
| Micro Grants | $500 - $2,000 | Small experiments, events |
| Standard Grants | $2,000 - $20,000 | Projects, integrations |
| Major Grants | $20,000 - $100,000 | Significant initiatives |
| Strategic Grants | $100,000+ | Core infrastructure |
Grant Process
- Application — Submit proposal with budget and timeline
- Review — Council evaluates feasibility and alignment
- Community Input — Public comment period
- Vote — Governance vote if above threshold
- Funding — Milestone-based or streaming payments
- Reporting — Regular progress updates
Asset Management
Supported Assets
| Asset Type | Use Case |
|---|---|
| Local Stablecoin | Primary operating currency |
| USDC/USDT | Cross-chain payments |
| ETH | Gas reserves, L1 operations |
| Protocol Tokens | Strategic partnerships |
Diversification Guidelines
| Principle | Implementation |
|---|---|
| Stablecoin Priority | 60-80% in stable assets |
| Operating Buffer | 6+ months runway |
| Risk Limits | Max 10% in volatile assets |
| Liquidity | 30% immediately available |
Implementation Guide
Setting Up Treasury
- Deploy Contracts — Treasury, timelock, governor
- Configure Multi-Sig — Set up council signers
- Set Parameters — Spending limits, timelocks
- Fund Initial Balance — Seed treasury
- Test Workflows — Simulate proposals and spending
Configuration Checklist
| Parameter | Decision Needed |
|---|---|
| Multi-Sig | Number of signers, threshold |
| Timelocks | Duration by transaction type |
| Spending Tiers | Amount thresholds |
| Categories | Budget allocation percentages |
| Reporting | Frequency and format |
Learn More
- Local Governance Model — Overall governance framework
- Voting Mechanisms — How decisions are made
- Upgrade Process — Protocol change governance
- Economic Model — Network economics