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This week we look at the current avant-garde project of the NFT space, Nouns DAO.
What is Nouns DAO?
by Nouns DAO
The Nouns DAO project holds a single auction every day, forever. Each auction is for a JPEG character called a Noun.
Nouns are colorful pictures of pixelated, block-like figures with glasses that look like something one would doodle in the middle of a boring lecture on grid paper.
The winner of the Noun is granted ownership of the NFT, but also gains access to the decentralized autonomous organization (DAO).
All revenue from the day’s winning bid goes into a treasury, which members of the DAO have control over through their votes. Each Noun equals one vote in the DAO.
The auctions began on Aug. 7, with Noun 1 earning a high bid of 613 ETH, or $1.9 million. Each successive Noun takes on the auction number. Thus, the second Noun to be auctioned is known as Noun 2, and so forth. This is a different approach from typical NFT drops where a fixed number (usually 10,000) are minted all at once.
Ever since the minting of Noun #8, each winning bid has been for at least 118 ETH. For a bit of perspective, if Nouns continue minting once per day, the community will mint Noun #10,000 at the end of 2048.
Who are the Nouns DAO creators?
One of the co-creators and the most prominent spokesman for the Nouns project is Punk 4156.
Punk 4156 is one of the most influential voices in the NFT community. His name is derived from the Cryptopunk number that he owns. Along with the Cryptopunks, 4156 was an early adopter of the Bored Ape Yacht Club, and an early buyer of artwork by Beeple and XCopy.
The project has ten founders, also known as “Nounders” (har har). Some of the Nounders include NFT legends such as
- Dom Hofmann. Co-founder of Vine, Blitmap, Loot, and more. The guy is an NFT product machine
- eBoy Arts
These Nounders have programmed the Project so that every 10th Noun created is distributed evenly among the nounders for the next five years. In essence, after every 100 auctions, each Nounder will own one Noun. After five years, each Nounder will own 18.25 Nouns. This gives nounders incentive to continue working and developing the project well into the future.
There’s a saying in horse racing, “Buy the jockey, not the horse.” This is a prime example of investing in the jockeys.
Here is a recent interview that Punk 4156 did with Kevin Rose:
What is a DAO?
A decentralized autonomous organization (DAO) is just what it sounds like; an organization created by a group of people that is independent of a centralized governing body and as such, makes decisions on a democratic scale through a body of votes.
A Noun is minted every day after an auction is won. Ownership of a Noun equals one vote in the DAO. There are no restrictions on who can buy a Noun, so any auction winner becomes a member of the DAO as it pertains to the treasury and ownership of the NFT.
As these auctions continue every day and new Nouns are minted, the collective of Nouns will each own a vote in the DAO and its multi-million dollar treasury.
Nouns DAO Treasury and Voting History
From the site:
While projects such as Cryptopunks have attempted to bootstrap digital community and identity, Nouns attempt to bootstrap identity, community, governance, and a treasury that can be used by the community for the creation of long-term value.
The key here is the word treasury. The Nouns are attempting to create a community with a huge amount of money to see what kind of influence they can attain on whatever matter they vote on. It’s like crowdsourcing with people with a lot of money and, presumably, with a lot of influence in the cryptosphere and NFT-verse.
As of this writing, the treasury contains nearly $17.5 million in ETH, and is barely one month into existence.
So far, the DAO has used the treasury (through a vote) to donate 1 ETH to each of six charities. In fact, this was the very first thing the DAO voted on.
Thanks to the transparent nature of the blockchain, the distribution of ETH and the projects it was sent to are available for anyone to see.
How to Buy in to Nouns DAO
There are auctions occurring everyday, 24/7. In order to place a bid, go to the Nouns site, connect your digital wallet and place a bid using Ethereum.
However, you may be asking,
“I don’t have 120 ETH for Nouns DAO. How can I invest?”
Good question. Since each Noun is now going for around half a million dollars, it’s out of reach for many.
Luckily the world of NFT fractionalization is upon us.