Financial Crisis Forces Treasure DAO to Reduce Operations and Focus on Core Products
Treasure DAO, a decentralized video game ecosystem, has announced a significant restructuring plan aimed at extending its financial runway until at least February 2026. Chief contributor John Patten has resumed a leadership role to guide the organization through what he describes as "a matter of survival."
The DAO currently faces serious financial challenges with only $2.4 million left in its treasury. Its ecosystem fund holds 22.3 million MAGIC tokens valued at $2.3 million. With an annual burn rate of $8.3 million, the organization's stablecoin reserves will be depleted by December without immediate action.
Cost-cutting measures include laying off 15 contributors and terminating game publishing support and the Treasure chain. Patten has also proposed withdrawing $785,000 from market maker Flowdesk to bolster the treasury, which could extend the runway to February 2026 in "an optimistic scenario."
The restructuring plan narrows Treasure DAO's focus to four key products:
- The marketplace
- Bridgeworld
- Smolworld
- AI agent scaling technology
Patten stated these will be the only products Treasure focuses on through 2025. He explained that Bridgeworld and Smolworld will serve as demonstration cases for how other projects can use MAGIC marketplace and the organization's AI framework.
Launched in 2021, Treasure DAO previously offered infrastructure and advisory services to Web3 game publishers. However, Patten admitted the organization "didn't have a scalable business model" and hasn't grown since the Arbitrum airdrop in March 2023.
This restructuring comes as Arbitrum DAO has proposed a full clawback of its Gaming Catalyst Program funds. The proposal cites Treasure DAO's exit from the Arbitrum ecosystem as one factor, along with transparency issues and management problems that have affected multiple gaming initiatives on the platform.
The DAO's token MAGIC has dropped 16.5% to $0.0872 in the last 24 hours. Overall, the token has lost 98% of its value since reaching its all-time high of $6.32 in February 2022.
