Location: Discord General Voice Channel

**Time: 09:00 am EST Meeting Minute Writer: DeepSea (JD Sutton)

Next Meeting:** 8-December, 2022

TO-DO FOR NEXT MEETING:

• [x] Phylo to ask Anja if she can attend the Thursday meeting. (Anja replied that she is busy but will try to find a time available in the future).
• [ ] Phylo work on update to communicate to community.
• [ ] DeepSea (JD) work on update to communicate to community through Shimmer Governance Twitter profile and other communication mediums.
• [ ] DeepSea (JD) Build a better meeting minutes tracker in Notion hyperlinked from the Shimmer Notion webpage.
• [x] DeepSea (JD) To write up minutes.
• [ ] Phylo to inform applicants by posting a reply a link to this update.
• [x] Phylo to finalize version 3 of the Shimmer Committee Framework and get it ready for public posting.
• [x] Phylo, prepare for starting Phase II of committee application process for Friday 9-Dec, 2022.

MINUTES:

Background: Up until now the direction the Governance group (Iota Foundation & Community Volunteers) was to create the Shimmer Treasury Community under a Swiss GmbH legal entity. Also, the planning of the committee applications was scheduled to align with the completion of the latest Firefly Shimmer wallet release. The original scheduled estimate was given to be between mid-November and mid-December (at latest). The critical paths to completing and forming the Shimmer Treasury lie directly with the creation of the legal entity and the technical implementation to vote and confirm the formation of the Shimmer Committee and Entity through a Shimmer Firefly wallet vote. Over the past two weeks it became visible that the Swiss GmbH would lead to costly tax implications and risk taking funds away from an altruistic non-profit venture of the goal the Shimmer Community Treasury was envisioned for. As well, the Firefly team has adjusted their technical goals (it appears) and decided to develop more and better integrate further capabilities within the wallet. The downside of this is the scheduled completion date has been pushed back thus directly affecting the completion time for the Shimmer Treasury formation. So where does this leave the Shimmer Community Treasury today? We have completed Phase I of the applications as previously scheduled with a slight delay. As a few key variables have changed given the schedule and adjustment to what type of entity will be used. We decided to have a meeting (which occurred on 6-Dec, 2022) to assess the current directional changes, find a new unified focus, and progress onwards and forward.

The consensus of the community and the IF has been to communicate the schedule changes, proceed with Phase II this Friday 9-Dec 2022, and in the meantime, waiting for Firefly to complete their governance voting integration, we will work on finalizing what type of entity the Treasury will use. You may be asking, “Wen”!!! When will Phase III and the committee members officially take over and start running the treasury? The answer to this is complex because it completely depends on the completion of the next Shimmer Firefly version and the groups agreement of which entity to use for the Treasury. Neither of these steps have confirmed dates nor have confirmed estimated schedules of completions. At most, the group has control to quickly through focused meetings agree to what legal entity to use, but we have 100% no control over the schedule in which the Firefly wallet will be completed. As well, we 100% know the IOTA Foundation will not give out any time estimates. It is, simply a wait and see moment. At best, we can wait until Firefly moves into public Beta testing. At this point we should have a better estimate of completion. We discussed two possible solutions with the ‘present’ information we currently have, a short and long-term solution.

1. Short Term Solution – If and when Firefly officially releases, potentially the voted committee members can be sub-contracted in someway under the Tangle Ecosystem Association (TEA) so that the committee can accept, review, and fund proposals (ie. Via the TEA). The TEA would essentially be the organization managing the Shimmer Community Treasury wallet until we officially have a legal entity, smart-contracts, and a framework in place. With this short-term solution we need to gather some information first:
   1. Is this even possible? It was discussed and requested that Dr. Anja Raden (Executive Director of Legal & Regulatory Affairs) joins the meeting this Thursday to discuss this matter and potentially also discuss legal framework options in which the Treasury. Can form under.
   2. This short-term solution can only be implemented if it is legally possible under the TEA, and particularly more so, it is only possible if the Firefly Shimmer wallet is finalized and released. As we all know, with technology and particularly how fast things are moving with the Shimmer protocol, there is no chance for anyone to legitimately say when this occurs. One estimate stated is to be out by mid-January but who knows really. All we can do is wait until the public Beta testing is activated and see what type of bugs occur. Only then, will we truly know any type of estimate. As always with code development, if there are no bugs it will be a quick release. However, if there are major bugs, then it will take longer. The fact is, there is no way today we can give any real estimate it will be completed. So safely we can give a very expansive margin of error and say, Firefly will be completed sometime between mid-January 2023 to mid-June of 2023. Again, only when we have a much more precise estimate through actual use (ie. beta testing) will we start to be able to assess an estimated completion date.
2. Long Term Solution – The ultimate vision of the Treasury is to have a legal entity to primarily give liability protection and try to stay ahead of changing regulations. Legal entities also are the bridge between the Web3 Treasury and income generating avenues. As well, as the DAO space changes by the week, a few countries are offering amazing solutions in which a whole community can actively participate in governance. With the change from the Swiss GmbH structure, we brought up some of the community’s discussions within the Governance discord thread. We discussed comparing a legal entity vs. a fully decentralized DAO like AAVE. The group discussed the points and agreed to stick with the direction of being a legal entity as we have been focusing on. However, we decided to continue analyzing different global solutions now that we are pivoting away from the Swiss GmbH. For example, the countries discussed in which we might form a legal entity were:
   1. Switzerland
   2. Lichtenstein
   3. Marshall Islands

In some way we have revisited this discussion and come full circle. Unfortunately, that is nature the nature of a long-term project within the crypto space and especially when certain variables change. Yet the takeaway from it all is that the community and group agree to form a legal entity. The next step is to simply find the best entity that supports the vision of the Shimmer Treasury while considering variables such as: tax implications, cost of legal setup, cost of legal maintenance, how the community can be incorporated, and how the governance structure is managed.

Given @phylo has been doing A LOT of research into different legal setups and found over the past year and a half Swiss entity formations appear to be the best setup. As well, the TEA has already been setup as a Swiss Association (Verein) which offers excellent tax mitigation, supports altruistic grant funding, can be setup in an expediate manner, and could offer different levels of smart-contract integration governance voting from the community. The group discussed what is involved with the Swiss Association and the steps needed to complete this process if there was consensus from the group to continue forward with this direction.

MEETING NOTES BULLET POINTED: