Stabilizing DAO Treasuries with Ampleforth: An Elastic Supply Approach for Long-Term Resilience in Decentralized Finance

Documenting AMPL
6 min readApr 25



DAO treasuries play a vital role in the decentralized finance (DeFi) ecosystem, with their value being susceptible to market fluctuations. This paper explores the potential of Ampleforth (AMPL) as a value-add to DAO treasuries through a case study. AMPL, with its unique elastic supply mechanism, offers stable purchasing power and inflation resistance, making it a suitable asset for DAO treasuries. The case study compares the performance of a $109,300 DAO treasury investment in AMPL, ETH, and BTC from April 2022 to April 2023. The results indicate that AMPL outperforms both ETH and BTC until March 2023, despite experiencing supply contraction periods. The analysis suggests that incorporating AMPL into DAO treasuries can provide stability and value, enabling them to better manage market volatility and maintain long-term success.

Enhancing DAO Treasury Stability with Ampleforth: An Empirical Analysis


DAO treasuries are an important component of the decentralized finance (DeFi) ecosystem. A DAO, or Decentralized Autonomous Organization, is a digital-first entity that shares similarities with a traditional company structure but has some additional features, such as the automatic enforcement of operating rules. DAO treasuries are the funds that a DAO holds, which can be used to finance the DAO’s operations, invest in other projects, or fund community initiatives.

DAO treasuries are typically held in cryptocurrencies or stablecoins, with the majority being held in native tokens. While there is currently over $9.5 billion held in DAO treasuries across all networks, the value of these treasuries can be highly volatile due to market fluctuations. To manage this risk, DAOs are starting to diversify their treasuries by holding multiple assets, including stablecoins and cryptocurrencies, in order to minimize the impact of market volatility.

DAO treasuries are an important factor in determining the success of a DAO. They can be used to finance the DAO’s operations, invest in other projects, or fund community initiatives. However, it’s important for DAOs to manage their treasuries carefully, by diversifying their assets, ensuring transparency in treasury management, and using proper incentives for token holders. Proper treasury management is essential to ensure the long-term success and stability of a DAO, and to ensure that its goals are achieved in a sustainable manner.

However, managing these treasuries can be a challenge due to market volatility, particularly when they are held in cryptocurrencies or native tokens. In this context, AMPLcan play a critical role in providing stability and value to DAO treasuries. AMPL’s unique supply adjustment mechanism allows it to maintain a stable price despite market fluctuations. By leveraging the benefits of AMPL, DAOs can improve the stability and sustainability of their treasuries, providing a solid foundation for long-term success.


To assess the performance of AMPL as a DAO treasury asset, we analyzed historical data from April 2022 to April 2023 (YTD). The methodology used in this case study involves the following steps:

  1. Initial investment assumption: We assume that a DAO holds 100,000 AMPL tokens in April 2022, valued at the standard market oracle rate at that time (approximately $1.093 per AMPL), which amounts to a total investment of $109,300. For comparison, we also consider equivalent investments in ETH and BTC, which are approximately 37.17 ETH and 2.76 BTC, respectively.
  2. Data sources: We collect historical price data from the CoinGecko API and historical rebase data from Coin Tools. This data allows us to analyze the performance of a $109,300 DAO treasury investment in AMPL, ETH, and BTC over the past year.
  3. Calculating token count after daily rebases: To ensure transparency, we provide the Python code utilized to calculate the token count following daily rebase periods. This code reads rebase data from a CSV file and calculates supply adjustments based on the rebase percentages. The adjusted supplies are then appended to a list and printed for each day.

For transparency, the code utilized to calculate the token count following daily rebase periods is shown below:

The code can be adjusted to match any data set and initial token supply, which represents the starting supply before daily rebases are accounted for. This flexibility is helpful for DAOs and individual investors who may be anticipating rebase events.

By following this methodology, we can evaluate the resiliency of a DAO’s investment in AMPL, ETH, and BTC over the past year. The analysis helps to demonstrate the potential benefits of incorporating AMPL into a DAO’s treasury management strategy, particularly in terms of stability, value, and adaptability in the face of market volatility.

Analysis and Findings

Upon analyzing the data from April 2022 to April 2023, we found that AMPL outperformed both ETH and BTC until March 2023, when AMPL’s market cap experienced a decline. This superior performance occurred despite AMPL being a rebasing asset that went through significant periods of supply contraction during the past year. Assuming the DAO held 100,000 AMPL tokens in April 2022, the rebase mechanism would leave the DAO with just under 50,000 tokens by April 2023.

At its peak during the past year, the DAO’s AMPL holdings would have expanded to almost 131,000 tokens, representing a 31% increase in supply for every 100,000 tokens. AMPL’s rebase mechanism can be visualized below:

During spring 2022, all three assets experienced a decline. However, AMPL’s positive rebase cycles led to a significant increase in sustainable value, even during extended periods of decline. This value-capture mechanism can be attributed to a combination of factors, primarily:

  • Durable unit of account: AMPL’s unique design makes it an extremely durable unit of account, capable of withstanding market fluctuations.
  • Rebase mechanism: The rebase mechanism helps to alleviate the stresses of sudden and severe market contractions by spreading out contractionary periods.

While traditional assets like ETH and BTC are entirely subject to market dynamics, AMPL can mitigate market stresses through its rebase mechanism. Although AMPL is still affected by immediate market impacts on its price, the price target adjustment allows AMPL to capture additional value that BTC and ETH miss through inflation resistance. From April 2022 to April 2023, the price target for AMPL increased from $1.093 to $1.151 (a 5.3% increase).

Although AMPL may appear less favorable during specific short-term periods, longer timeframes show that AMPL maintains its value better over time compared to traditional assets like ETH and BTC.

The comparative performance of AMPL, BTC, and ETH over the past year can be seen below:

This in-depth analysis underscores the potential benefits of incorporating AMPL into a DAO’s treasury management strategy. By leveraging the unique properties of AMPL, such as its durability as a unit of account and its rebase mechanism, DAOs can enhance the stability and value of their treasuries, making them more resilient to market fluctuations over time.


In conclusion, incorporating the Ampleforth (AMPL) token into a DAO’s treasury management strategy offers numerous advantages. These benefits include:

  1. Stable purchasing power: AMPL’s elastic supply mechanism maintains stable purchasing power by adjusting the token supply according to market demand. This ensures that the DAO’s treasury value remains relatively stable amidst market fluctuations, enabling more informed and less volatile financial decisions for operations, investments, and community initiatives.
  2. Inflation resistance: The Ampleforth protocol’s unique supply adjustment mechanism provides protection against inflation, which can erode purchasing power in traditional finance. By integrating AMPL into a DAO treasury, the organization acquires an asset that safeguards its holdings from the adverse effects of inflation and ensures long-term preservation of value and purchasing power.
  3. Recession-resistant properties: The Ampleforth network’s distinctive design exhibits recession-resistant characteristics. While the rebase mechanism may introduce short-term volatility, it operates through gradual adjustments rather than immediate changes. This results in less severe contractions within the network compared to sudden market movements, enabling the DAO to navigate challenging market conditions and maintain stability during periods of economic uncertainty.

This paper demonstrates that leveraging AMPL’s unique elastic supply mechanism allows DAOs to achieve stability and value in their treasuries while mitigating the impact of market volatility. The integration of AMPL into DAO treasuries not only highlights its potential benefits but also underscores its broader implications for the DeFi ecosystem.