MegaStrategy DAO

MegaStrategy DAO governs the protocol. It receives revenue from Secondary Market fees and a percentage of all $MSTR minted through warrant exercises.

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What is MegaStrategy DAO?

MegaStrategy DAO is the decentralized organization that manages and governs the MegaStrategy protocol. It controls:

• Protocol parameters and policies

• Bond terms and offerings

• Treasury management decisions

• Future development direction

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DAO Revenue Sources

MegaStrategy DAO has two primary revenue streams:

Source	Description
Secondary Market fees	Trading fees from Note and Warrant NFT trades on the secondary market
3% Warrant exercise minting	For every $MSTR minted when warrants are exercised, 3% additional $MSTR is minted for the DAO

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The 3% Minting Mechanism

When warrant holders exercise their warrants, new $MSTR is minted for them. Simultaneously, the protocol mints an additional 3% for MegaStrategy DAO.

Warrant Exercise
        │
        ▼
$MSTR minted for holder (100%)
        │
        ▼
Additional 3% minted for DAO
        │
        ▼
DAO Treasury grows

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Example

Alice exercises her Warrant and receives 66.67 $MSTR.

At the same time:

• Protocol mints: 66.67 × 3% = 2 $MSTR for MegaStrategy DAO

Total $MSTR minted: 68.67 $MSTR

• Alice: 66.67 $MSTR (100%)

• DAO: 2 $MSTR (3%)

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Why 3% Minting?

This mechanism ensures:

Benefit	Description
Sustainable funding	DAO receives ongoing revenue tied to protocol activity
Aligned incentives	DAO benefits when warrants are exercised (protocol success)
No direct tax on users	The 3% is minted separately, not deducted from user rewards

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DAO Treasury vs. BTC Treasury

	BTC Treasury	DAO Treasury
Holds	Bitcoin	$MSTR + Trading fees
Purpose	Back bonds, support $MSTR value	Fund DAO operations, development
Benefits	Bond holders, Note NFT holders	MegaStrategy DAO
Fed by	Bond sales, MSTR Market fees	Secondary Market fees, 3% minting

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Governance

MegaStrategy DAO governance details will be published separately. The DAO is responsible for:

• Setting bond series parameters

• Managing protocol risk parameters

• Directing DAO Treasury funds

• Approving protocol upgrades

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