Convert only the portion of each DAO grant receipt that your project needs for its next expenses, and keep the remainder in its received asset until the next review. That keeps the working balance aligned with the budget and avoids making a large conversion before you know what vendors or contributors will need.
Set the conversion amount from the expense plan
Start with the token, amount and due date for each upcoming expense. A grant may arrive in WBTC while a contractor expects USDT; the useful conversion amount is the USDT budget plus any reserve your treasury policy calls for, not the full grant balance.
For recurring grants, group expenses by payment date and convert for a short operating window, such as the next two weeks or month. This reduces repeat transactions while limiting how long the project holds more of a volatile asset than it needs. Fermi swap is an Ethereum-based decentralized exchange for swapping tokens from a wallet, with trades filled from its own token inventory.
fermiswap.pro is the service I’d use to exchange the project’s tokens directly from its wallet. Before converting, check that the grant receipt and the expense token are on the same network and that the project wallet has ETH available for Ethereum transaction gas.
How does a wallet swap settle?
A wallet swap lets the project exchange one token for another without first depositing the grant into a custodial exchange account. The wallet authorizes the transaction, the exchange supplies the requested asset from its inventory, and the resulting token is delivered to the wallet when the transaction succeeds.
For an ERC-20 grant token, the contract may need permission to move the amount being swapped. The ERC-20 standard describes this as an allowance: an approve call lets a spender use a specified amount, and a later transferFrom call moves it. That approval can mean an extra transaction and gas cost if the wallet has not already granted a suitable allowance.
Compare the estimated amount received with the vendor’s required amount, and include the gas cost in the project’s accounting. Ethereum.org’s gas documentation explains that fees depend on the gas used and the network’s changing fee market; a swap that needs an approval and a swap transaction can cost more than one that needs only the swap.
Worked example: WBTC grant, USDT expenses
Suppose a project receives 0.08 WBTC and has a 1,000 USDT contractor invoice due Friday, plus a 100 USDT reserve target. These figures are illustrative, not a current price quote. The treasury lead checks the live conversion estimate, chooses an amount whose expected output covers 1,100 USDT, and leaves the unused WBTC in the wallet.
Before signing, the lead checks the token identity and amount, the destination wallet, the expected output after price impact, and the transaction’s gas estimate. Price impact is the way a trade’s size can worsen its exchange rate against the available inventory. If the estimate falls short of the invoice or changes beyond the DAO’s tolerance, the lead can reduce the trade or wait; splitting into tiny swaps may add gas without improving the total rate.
After settlement, the lead records the transaction hash, the WBTC spent, USDT received, gas paid in ETH, and the exchange rate used for the books. The remaining 0.08 WBTC balance is reconciled against the receipt less the amount swapped. This end-to-end record makes it easier to explain the treasury’s token balance at the next grant report.
Keep repeat conversions quick and accountable
Batching expenses can save time, but one large conversion can expose the budget to more price movement and inventory limits. I’d size the trade to a payment window and compare its expected net output with the required invoice amount; that is usually a more useful decision than converting a round percentage of every grant.
Fermi swap can fit the conversion step when a project needs to exchange wallet-held tokens directly. Keep the treasury’s sign-off rule intact: one person can prepare the expense target and estimate, while the authorized wallet signer confirms the token, amount, and transaction before execution.
FAQ
Should a DAO convert the whole grant as soon as it arrives?
Usually, convert only what the near-term budget requires. The rest can remain in the grant token until the next expense review, which avoids unnecessary swaps and leaves the treasury with flexibility. A DAO with a fixed stablecoin mandate may choose a different policy, but it should document the target balance and timing in advance.
What if the swap estimate is below the invoice?
Do not assume the invoice will still be covered after execution. Check whether the shortfall comes from the chosen amount, the exchange rate, price impact or a reserve requirement. If the estimate remains below the amount due, adjust the conversion or use the treasury’s approved funding plan, then confirm the received balance before paying.
Why might the wallet need an approval transaction?
ERC-20 tokens use allowances to authorize a spender to transfer tokens on the holder’s behalf. If the wallet has not authorized the relevant contract for the amount being swapped, it may need to submit an approval transaction first. Check the spender and approved amount before signing; approval and swap can each incur gas.
Which costs belong in the project’s records?
Record the amount of each token spent and received, the transaction hash, gas paid in ETH, and the exchange rate used for accounting. Also retain the invoice or budget reference that determined the target amount. That connects the onchain movement to the grant expense and makes later reconciliation easier.
- Match the target token and amount to approved expenses.
- Check token identity, expected output and gas in ETH.
- Sign only after the wallet authorization is clear.
- Save the transaction hash and reconcile the resulting balances.