[SIP] Treasury Wind Down & Distribution Plan

General
1

Summary

This proposal seeks to:

  1. Convert all treasury assets into USDC

  2. Cover remaining bad debt incurred due to the Resolv hack in the Seamless USDC Vault on Morpho

  3. Fund essential wind-down operations

  4. Distribute remaining treasury funds to SEAM and stkSEAM holders

This proposal prioritizes user protection, responsible closure of operations, and value return to long-term supporters.

Background & Motivation

Following the announcement of the Seamless Protocol sunset on April 7, 2026, the Seamless UI was officially taken offline on July 1, 2026, marking the completion of the protocol’s winddown. Up to date:

  • Most core contributor and third-party contracts have been terminated

  • The remaining contributors have continued working to ensure a smooth wind-down

  • Final legal, technical, and operational tasks must still be completed

Separately, the Seamless USDC Vault on Morpho (curated by Gauntlet) accumulated 381,904.41592 USDC in bad debt, due to exposure to Resolv Morpho markets. In accordance with the agreement between Resolv and Gauntlet, Resolv will cover a portion of the bad debt incurred by the Seamless USDC Vault. For additional details, please refer to Gauntlet’s and Resolv’s announcements.

The DAO now faces three priorities:

  1. Protect users affected by the vault bad debt

  2. Ensure an orderly and compliant wind-down, including the settlement of all outstanding obligations to counterparties, the resolution of any remaining legal matters, and the fulfillment of all regulatory and compliance requirements

  3. Return remaining value to token holders

Proposal Details

Step 1: Treasury Consolidation into USDC

The current state of the treasury includes the following assets:

USDC: 615,319.60

weETH: 91.34

veAERO*: 471,116.41

WETH: 10.51

AERO: 26,344.85

USDbC: 6,610.42

wstETH: 2.52

EURC: 4,069.11

cbBTC: 0.05

DAI: 585.38

BRETT: 30,407.07

VIRTUAL: 718.73

MORPHO: 111.14

cbETH: 0.10

ABX: 90,532.00

COMP: 3.13

ETH: 0.01

All assets currently held in the Seamless DAO treasury will be converted into USDC to:

  • Simplify accounting and distribution

  • Reduce volatility risk during wind-down

  • Ensure liquidity for obligations

Once the conversion process is complete, the total amount of USDC received will be published in a separate comment on this proposal and announced in the Seamless Discord server.

* If this proposal is agreed to, core contributors would be tasked with identifying and executing on the best opportunities to sell the locked veAERO position. Since veAERO is an NFT representing a locked AERO position, it cannot be traded on either centralized or decentralized exchanges. Therefore, any sale must be conducted over the counter (OTC), with the exchange rate determined by the terms agreed between the buyer and the seller.

Step 2: USDC Vault Bailout

The DAO will allocate treasury funds to cover the remaining 190,925 USDC in bad debt associated with the Seamless USDC Vault on Morpho in order to ensure all vault users can withdraw funds in full.

Step 3: Wind-Down Budget Allocation

A total of $254,943 are to be allocated to fund essential shutdown operations: engineering, security, operational and legal. Refer to this document for a cost breakdown.

Step 4: Distribution to SEAM & stkSEAM Holders

All remaining treasury funds after Steps 2 and 3 will be distributed to:

  • SEAM token holders

  • stkSEAM holders

Key Conditions:

  • A snapshot will be taken on July 24, 2026, to give users who hold SEAM on centralized exchanges (CEXs) sufficient time to withdraw their tokens to self-custodied wallets. If you hold SEAM on Ethereum mainnet, you will remain eligible to claim your allocation.

  • Distribution claims will be processed on Base through https://app.merkl.xyz/.

  • Users with smart contract wallets on Ethereum mainnet should ensure they control the same address on Base, or migrate their wallet before the snapshot.

  • Exchanges (both CEXes and DEXes), aggregators, certain smart contracts (deemed unable to claim) and other protocols are excluded from the distribution. Please withdraw your tokens to self-custodied wallets before July 24, 2026.

  • If you hold stkSEAM, no further action is required on your part.

  • Wallets associated with the Seamless Protocol, its Core Contributors, or other affiliated entities are excluded from this distribution.

  • To be eligible for the airdrop, a wallet must hold at least 25 SEAM or stkSEAM on July 24, 2026.Funds will be distributed pro-rata across SEAM and stkSEAM holders.

  • Distribution of funds will be processed via Merkl. No claim deadline will be imposed, allowing eligible recipients to claim their allocation at any time. Please note that Merkl may charge a small fee for facilitating the distribution. The exact fee will be agreed upon with Merkl once the final amount to be distributed has been determined and will be deducted from the distribution pool.

  • If you are a holder of esSEAM, make sure to claim your vested amounts into SEAM before the snapshot.

Implementation Details

Proposal Actions

  1. Withdraw all assets from the DAO contracts

  2. Core contributors to sell these assets into USDC

  3. Core contributors to allocate USDC for Morpho vault bad debt

  4. Core contributors to allocate USDC for wind down costs

  5. Core contributors to setup airdrop through Merkl for remaining USDC

2 Likes
2

A bit of a pity it ended this way. I never sold my main SEAM bag they were worth around $20k at one point. No regrets, It was a good journey!

Huge respect to the team for building in the open and so nice. Not every project makes it, but delivering safely for users and returning value to the community says a lot.

Thanks for the ride, Seamless. Wishing the team and the community all the best in whatever comes next. :handshake::blue_heart:

2 Likes
3

Since many of us people sold SEAM because of the wind down, not many of the supporters are holding any longer! Does it make better sense to use a snapshot from earlier? Like and earlier airdrop or something with usage?? Otherwise who is really getting the distribution i suppose! Thank you!

4

Thank you for your question. The rationale behind using a future snapshot date is to ensure that the holders and stakers who remain most affected by the wind-down are appropriately recognised.

We believe that a distribution can only be truly fair if all eligibility criteria are communicated clearly in advance. Using a retroactive snapshot would mean applying conditions that were not known to the community at the time and could unintentionally benefit some participants over others. Our goal is to provide the entire community with equal treatment, full transparency, and clear rules ahead of the snapshot.

Additionally, SEAM and stkSEAM holders are the participants with governance rights over the DAO’s assets and the only community members able to delegate voting power. They will vote on the proposal and ultimately decide whether the proposed distribution framework should be approved.

5

after the snapshot when do estimate for the distributin on merkl ??

6

It’s difficult to provide an exact timeline at this stage, as much will depend on how long it takes to liquidate the veAERO position. This process can only begin if and when the proposal is approved.

Once the position has been liquidated and the total amount available for distribution is known, the fee arrangement with Merkl should be finalised.

My rough estimate is that the process might take several weeks, but this is only a preliminary estimate and should not be considered an official timeline.

7

[SIP-51] Treasury Wind Down & Distribution Plan

Summary

This proposal seeks to:

  1. Convert all treasury assets into USDC

  2. Cover remaining bad debt incurred due to the Resolv hack in the Seamless USDC Vault on Morpho

  3. Fund essential wind-down operations

  4. Distribute remaining treasury funds to SEAM and stkSEAM holders

This proposal prioritizes user protection, responsible closure of operations, and value return to long-term supporters.

Background & Motivation

Following the announcement of the Seamless Protocol sunset on April 7, 2026, the Seamless UI was officially taken offline on July 1, 2026, marking the completion of the protocol’s winddown. Up to date:

  • Most core contributor and third-party contracts have been terminated

  • The remaining contributors have continued working to ensure a smooth wind-down

  • Final legal, technical, and operational tasks must still be completed

Separately, the Seamless USDC Vault on Morpho (curated by Gauntlet) accumulated 381,904.41592 USDC in bad debt, due to exposure to Resolv Morpho markets. In accordance with the agreement between Resolv and Gauntlet, Resolv will cover a portion of the bad debt incurred by the Seamless USDC Vault. For additional details, please refer to Gauntlet’s and Resolv’s announcements.

The DAO now faces three priorities:

  1. Protect users affected by the vault bad debt

  2. Ensure an orderly and compliant wind-down, including the settlement of all outstanding obligations to counterparties, the resolution of any remaining legal matters, and the fulfillment of all regulatory and compliance requirements

  3. Return remaining value to token holders

Proposal Details

Step 1: Treasury Consolidation into USDC

The current state of the treasury includes the following assets:

USDC: 615,319.60

weETH: 91.34

veAERO*: 471,116.41

WETH: 10.51

AERO: 26,344.85

USDbC: 6,610.42

wstETH: 2.52

EURC: 4,069.11

cbBTC: 0.05

DAI: 585.38

BRETT: 30,407.07

VIRTUAL: 718.73

MORPHO: 111.14

cbETH: 0.10

COMP: 3.13

ETH: 0.01

All assets currently held in the Seamless DAO treasury will be converted into USDC to:

  • Simplify accounting and distribution

  • Reduce volatility risk during wind-down

  • Ensure liquidity for obligations

Once the conversion process is complete, the total amount of USDC received will be published in a separate comment on this proposal and announced in the Seamless Discord server.

* If this proposal is agreed to, core contributors would be tasked with identifying and executing on the best opportunities to sell the locked veAERO position. Since veAERO is an NFT representing a locked AERO position, it cannot be traded on either centralized or decentralized exchanges. Therefore, any sale must be conducted over the counter (OTC), with the exchange rate determined by the terms agreed between the buyer and the seller.

Step 2: USDC Vault Bailout

The DAO will allocate treasury funds to cover the remaining 190,925 USDC in bad debt associated with the Seamless USDC Vault on Morpho in order to ensure all vault users can withdraw funds in full.

Step 3: Wind-Down Budget Allocation

A total of $254,943 are to be allocated to fund essential shutdown operations: engineering, security, operational and legal. Refer to this document for a cost breakdown.

Step 4: Distribution to SEAM & stkSEAM Holders

All remaining treasury funds after Steps 2 and 3 will be distributed to:

  • SEAM token holders

  • stkSEAM holders

Key Conditions:

  • A snapshot will be taken on July 24, 2026 at approximately 12:00pm Pacific Time (19:00 UTC). Because of block timing, indexing, and data processing may vary slightly, users should keep their SEAM in an eligible self-custodied wallet on Ethereum or Base for the full day on July 24, transfers made close to the snapshot may not be reflected.

  • Distribution claims will be processed on Base through https://app.merkl.xyz/.

  • Users with smart contract wallets on Ethereum mainnet should ensure they control the same address on Base, or migrate their wallet before the snapshot.

  • Exchanges (both CEXes and DEXes), aggregators, certain smart contracts (deemed unable to claim) and other protocols are excluded from the distribution. Please withdraw your tokens to self-custodied wallets before July 24, 2026.

  • If you hold stkSEAM, no further action is required on your part.

  • Wallets associated with the Seamless Protocol, its Core Contributors, or other affiliated entities are excluded from this distribution.

  • To be eligible for the airdrop, a wallet must hold at least 25 SEAM or stkSEAM on July 24, 2026.Funds will be distributed pro-rata across SEAM and stkSEAM holders.

  • Distribution of funds will be processed via Merkl. No claim deadline will be imposed, allowing eligible recipients to claim their allocation at any time. Please note that Merkl may charge a small fee for facilitating the distribution. The exact fee will be agreed upon with Merkl once the final amount to be distributed has been determined and will be deducted from the distribution pool.

  • If you are a holder of esSEAM, make sure to claim your vested amounts into SEAM before the snapshot.

Implementation Details

Proposal Actions

  1. Withdraw all assets from the DAO contracts

  2. Core contributors to sell these assets into USDC

  3. Core contributors to allocate USDC for Morpho vault bad debt

  4. Core contributors to allocate USDC for wind down costs

  5. Core contributors to setup airdrop through Merkl for remaining USDC

8

The discussion period for SIP-51 has ended, and the proposal is now onchain. Voting begins in approximately 48 hours.

To participate, SEAM holders must delegate voting power to themselves or another delegate before voting begins.

Review and delegate: Cactus | Seamless Protocol | [SIP-51] Treasury Wind Down & Distribution Plan

9

SIP-51 Airdrop Distribution Update

While implementing SIP-51, two issues were identified for distributing the airdrop through Merkl:

  • Direct distribution — Merkl charges a fee, which would reduce the amount available for distribution.

  • Claim-based distribution — Merkl reserves the right to reclaim any unclaimed funds once the campaign ends, with a maximum campaign duration of 1 year.

To maximize distribution and ensure that all funds are distributed strictly among eligible wallets, it was decided to proceed with a standard multicall airdrop.

No claim will be required. Eligible users will receive the assets directly in their wallets.

A separate announcement will be posted once the airdrop has been executed.