# Removing an Asset from the DAO: Process Overview

**Scenarios for Asset Removal**

1. **Distressed Assets**:
   * These include properties nearing bankruptcy or experiencing significant financial or operational issues.
   * Removal decisions aim to mitigate losses and maximize capital recovery for DAO token holders.
2. **Pre-Bankruptcy Assets**:
   * These assets may require expedited liquidation to avoid further devaluation or legal complications.

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**Removal Methods**

1. **Off-Platform Sale**:
   * Managed as a **"MISC" Issue** in the DAO voting system.
   * Process:
     * Proposal is raised with details of the sale (e.g., property address, expected value, and use of proceeds).
     * Token holders vote to approve or reject the proposal.
     * Upon approval, the property is sold, and income is distributed as **capital dividends** to DAO owners.
   * This method provides flexibility but requires manual execution by the DAO property manager.
2. **On-Platform Sale**:
   * Uses the **Asset Token Sale (ATS)** Issue type for a structured and automated process.
   * Process:
     1. **Auction Announcement**:
        * The DAO initiates an ATS vote with property details, starting price, and auction terms.
     2. **Voting Outcome**:
        * If approved, the asset is listed for an on-platform auction or tokenized sale.
     3. **Successful Bid**:
        * The highest bidder acquires the asset, and a **new DAO** is automatically generated to manage it.
     4. **Proceeds Distribution**:
        * Funds raised are distributed to the original DAO’s token holders proportionally, or used as specified in the ATS proposal.

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**Benefits of On-Platform Asset Token Sale (ATS)**

1. **Efficiency**:
   * Automates the transition of the asset to a new DAO, minimizing administrative overhead.
2. **Transparency**:
   * Entire process, including auction bids and ownership transfer, is recorded on the blockchain.
3. **Flexibility**:
   * Enables DAO owners to directly participate in the auction or retain value through distribution of proceeds.

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**Key Considerations**

* **Voting Thresholds**:
  * Both off-platform and on-platform methods require majority approval based on the DAO’s governance rules.
* **Auction Parameters**:
  * Minimum bid, bidding duration, and acceptable payment types (e.g., ETH, DST) must be clearly defined in the ATS proposal.
* **Legal Compliance**:
  * Asset sales must adhere to local regulations governing distressed or pre-bankruptcy property transactions.

By combining off-platform flexibility with on-platform automation, this dual-method approach ensures the efficient and transparent removal of assets from the DAO while protecting the interests of token holders.
