What is the Community Treasury?

The Terra Community Treasury, or Community Pool as it is also known, is a dedicated pool of funds which are allocated via on-chain governance proposals. Terra users can submit a special kind of governance proposal (Community Pool Spend), and if the proposal passes the funds are allocated to the recipient address automatically by the protocol. The table below shows the 7 pool spend proposals available in the Flipside tables:

Tracking Down the Community Pool Address

Looking in detail at these Community Pool Spend Proposals seems like a good place to start. If we find the source of the funds, we should find the Community Pool.

Investigating a Funding Recipient

We will start with a case study. Proposal 51: PayWithTerra Community Pool Funding was proposed on the 18th of March 2021, with voting closing on the 5th of April. The proposal requested funding for the PayWithTerra initiative in the amount of 2300 LUNA. The recipient address for this funding was terra106h043ewfd0xrnwuazkf05q72cfm7kwj784la2.

Tracking down the Community Pool Address should be as simple as looking at the transactions to this address at around this time and finding the 2300 LUNA inbound one? Right? Let's have a look:

The table above shows the transactions in April that referenced the PayWithTerra recipient address. The first transaction after the proposal closing date (5th April) is a swap, where the user exchanges 2300 LUNA for UST. This is obviously the amount received from the Pool. The expected transaction from the Community Pool Address (our target) to the PayWithTerra, however, is not on the record. Where did the funds come from? Our assumption that this would be a traditional transaction was obviously wrong.

RTFM

When all else fails, start reading the docs. Terra has a comprehensive but very technical documentation set, found at docs.terra.money. A quick search for "Community Pool" brings up a couple of hits, with a brief description and some related Message Types. One of these grabbed my attention - MsgFundCommunityPool. There is no helpful documentation for this message, but there is a brief description of a related transaction available through the Terra CLI. The Fund Community Pool CLI transaction Funds the community pool with the specified amount. It appears as though the Community Pool not only gets funds from seigniorage revenue from the protocol, but it can be funded directly by users. This gives us another line of inquiry.

Pool Direct Funding Transactions

The Flipside tables have the MsgFundCommunityPool message type labelled in the Message Events table. We search this table for any events of this type and get the following:

There are only 2 transactions and two unique terra addresses referenced. This narrows the search space considerably!

The table above appears to show two transactions, both with the same sender and recipient. The recipient address, terra1jv65s3grqf6v6jl3dp4t6c9t9rk99cd8pm7utl could possibly be our pool.

Confirming Our Suspicions

Terra Finder is a block explorer for the Terra blockchain. Open the link to our Suspected Community Pool page on Terra Finder. On this page, we see the current account balances for the native Terra tokens. We can see that there is around 75m LUNA (worth a cool half billion USD) in this account. We compare this with the Community Pool balance on the Terra Station Dashboard, which is currently reading 73m LUNA. This is pretty close to our wallet balance. This amount is also around 7% of total LUNA supply, reducing the chance that this is a coincidence.

Conclusions

Tracking down the Community Pool was a challenge. The obvious path of looking for the from address for transactions following an approved proposal came to nothing. These distributions appear to be part of the underlying protocol, and not via a typical smart contract running on the network. This suspicion was confirmed in the documentation, where the Community Pool was referred to as part of the inner workings.

With a little bit of luck, we found the only two transactions whereby the Community Pool was funded by a direct donation, rather than by the normal funding method of seigniorage from the protocol. These funding transactions had a recipient address - terra1jv65s3grqf6v6jl3dp4t6c9t9rk99cd8pm7utl - which appears to be our Community Pool. We correlated the wallet balance of this address with the stated Community Pool balance on Terra Station - the numbers weren't exactly the same, but were close enough to make this a likely candidate.