[bisq-network/bisq] Running the numbers on Bisq DAO revenues (#5171)

[m52go]

I want to comment on some of the proposed financial statements. Bisq is a very different beast from typical legacy organizations, and trying to squeeze out typical legacy financial statements from DAO numbers doesn't make sense to me.

### Balance sheet

I'm not sure Bisq can have a balance sheet. How can such a thing be constructed? The project has no assets and no liabilities. It's not even an entity that can own assets or have liabilities.

Typically you get an equity value (book value) by subtracting liabilities from assets. The market's take on this book value of equity is what you see reflected in stock prices as market value of equity (aka market capitalization).

Bisq's **liabilities** are not liabilities in the traditional sense—they are merely a summation of repayments that the DAO has collectively _promised_ to pay out of future revenues. Typically, liabilities are legally-enforceable liens on assets, but this isn't the case with Bisq since it has no assets.

So Bisq is in a bit of a weird spot because it _cannot_ have a book value of equity. But it can (and does) have a market value of its "equity"—market capitalization. 

I put "equity" in quotes because Bisq's market capitalization is really just a summation of the market value of all BSQ held by sovereign individuals, like shares of stock. But unlike shares of stock, BSQ tokens signify value for their owners, not the originating entity. The market value of the Bisq project itself is nothing, but its market capitalization is a good proxy for the value of its software, network, community, etc. These are the only semblances of **assets** in Bisq land—but notice how these items all intangible and not fit for valuation.

### Cash flow statement

Measuring cash flow only makes sense if it's possible to to broke. Bisq cannot go broke, as in, it cannot ever run out of cash. It has no cash and all the cash at the same time. 

The result is that it can absolutely become unsustainable, in that the market can decide to value BSQ so low that the DAO can no longer sustain itself, but this is not a black-and-white determination that any financial statement can make. It's a decision the market will make if/when it wants to. Therefore having a cash flow statement doesn't make sense to me either.

### Income statement

This is the only legacy financial statement that makes any sense to me. Bisq issues BSQ every cycle and it burns BSQ every cycle. This fits well in the profit/loss paradigm. 

Measuring issuance and burn on a per-cycle basis also makes it possible to analyze activity in relation to trading activity, governance, and work done (i.e., exact contributions and improvements).

Profit and loss can be forecasted, of course, so such statements can be backward-looking and forward-looking.

### Time frames

Cycles seem like the only reasonable time frame for profit/loss analysis because issuance is done on a per-cycle basis. Anything else would result in inconsistent data. You can of course do months and quarters and years in terms of groups of cycles.

### Closing

I think many of the ideas in this thread are great, but if we're going to use certain terms, I want to make sure it's clear what the meaning of those terms are and what they mean in the context of this project. Base metrics must be understood properly in order to create second-order metrics and any further analyses.

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