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Token holders of NFTX, which bills itself as a liquidity protocol for non-fungible tokens (NFT), are weighing a proposal to diversify its treasury shortly after one of its investments, the USD coin (USDC) stablecoin, briefly lost its peg to the U.S. dollar.
The USDC incident earlier this month was a harrowing moment for the cryptocurrency industry, in which a key asset that investors used to safely – it was thought – park money suddenly proved uncomfortably volatile. Currently, all of NFTX’s stablecoin investments are in USDC, the second-largest one by market cap.
NFTX has about $20 million in its treasury, excluding its own governance token. About $1.3 million of that is invested in USDC. The proposal would move $2 million of the treasury elsewhere.
“Holding the stablecoin portion in USDC has already shown to be suspect to depeg in case of maximum chaos,” 0xchop wrote in the proposal. “Diversifying stablecoins into multiple stablecoins has to be considered if it does not impact operations too much.”
The proposal vote will conclude when it meets a quorum of 50,000 tokens, which is 10% of the governance token’s circulating supply. The vote has reached roughly 49,00 tokens, 94% of which were contributed by the address responsible for launching NFTX’s infrastructure.
Edited by Nick Baker.
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Elizabeth Napolitano is a news reporter at CoinDesk.
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