What is a noun? Ethereum NFT DAO to build open source IP

pixel art NFT Nothing new – one of the first NFT collections, CryptoPunks, pioneered the blocky 8-bit design style.

But Nouns is shaking things up with a novel distribution method and open-source IP, which has resulted in the series’ signature pixelated specs appearing everywhere, from beer cans to movies.

Here’s how Nouns works and how it’s building a multi-million dollar decentralized brand.

What is a noun?

First, Nouns is a collection of NFTs whose owners are part of the Nouns DAO, a Decentralized Autonomous Organization.

Non-Fungible Tokens (NFTs) are cryptographically unique cryptographic tokens that are often used to represent a piece of digital art. A noun is an example of a profile picture (PFP​​) collection, a set of NFTs commonly used as user profile pictures on social media platforms.

Nouns are also a creative experiment Ethereum Designed to improve the way the on-chain community interacts. The Nouns DAO does this by using its funds to build and support public goods.

It has been over a year since the first Nouns NFT, a pixel-art character with a fox head and pink glasses, was auctioned on Ethereum.During that time, the Nouns DAO has grown steadily and now holds over 29,000 ETH (~$45 million) in its vaults — a fund used to fund initiatives ranging from charitable giving to naming a new frog.

Who invented nouns?

The noun concept was inspired by Twitter Tips From an anonymous founding member, Punk 4156. After becoming interested in the idea, he followed up series of tweets Outline will always be the frame of the noun.

Soon after, a group of 10 Nounders, including Vine founder Dom Hofmann (who the Nouns called co-founders) started working through a shared Discord and created a DAO, using Punk 4156’s outline as a guide consolidate concepts.

What’s so special about nouns?

Each noun NFT is an algorithmically generated small picture of a human figure, which is then directly stored on Ethereum as a 32-pixel by 32-pixel picture blockchain.

The fact that nouns are stored directly in Ethereum’s scarce block space, rather than containing links to images hosted elsewhere (such as on the decentralized web hosting service IPFS), is a clear distinction between nouns and many other NFT projects. difference.

The algorithm underlying the Nouns protocol forges these NFTs from random combinations of backgrounds, body types, and clothing. Some of these nouns have flipbook calendars for the mind. Others go with geometric sports jumpers.

You can use potential nouns in the Nouns Playground, a tool that lets you combine various traits stored in the protocol.

Unlike the limited supply and exclusivity of PFP NFTs like CryptoPunks or Bored Ape Yacht Club, a new term is randomly generated and auctioned every 24 hours. After each auction, another unique noun (based on a set of predefined characteristics) is generated, and the process repeats forever. The Nouns smart contract automatically sends 100% of the proceeds directly to the DAO Treasury.

What is the noun DAO?

Every noun owner can join the noun DAO to help shape and govern the project by voting on Treasury-funded proposals. The DAO uses a fork of Compound Governance, where each Nouns NFT gives all members one vote. Although these votes are non-transferable, like using a proxy to attend a board meeting, members of the DAO can delegate someone else to vote on their behalf if the delegating person or entity still owns the noun for the vote.

Although there is no limit to the number of nouns a single entity or individual can have, at least two nouns are required to submit a proposal. Founding members receive rewards in the form of nouns (10% of the supply for the first five years, or every 10 nouns).

Each noun holder can sponsor and vote on Treasury-funded proposals. The idea is that the more unique and interesting the project being said, the more brand awareness the noun gets and the more people want to join.

Proposals funded by the Nouns DAO to date include:

  • 🏈 Featured Nouns in Super Bowl Ads – The proposal involved offering a Nouns NFT from the DAO to a company that would feature the iconic Nouns glasses in a 2022 Super Bowl commercial; the NFT eventually went to Bud Light, which officially aired during the coveted ad slot advertised. As part of the deal, Bud Light also changed his Twitter profile picture to Nouns NFT.
  • 🎥 nouns around town documentaries – Presented by the makers of Robot Chicken, the proposal and project was funded with 609 ETH and revolves around making a comedy film about the Nouns DAO trying to get the noun to appear in the Rose Parade.
  • noun coffee – Created by a team with a background in the global coffee industry, the Nouns coffee proposal was funded with 105 ETH to create and place the first Nounish consumer product brand in cafes and grocery stores.

How to buy noun NFT

Nouns are auctioned on the Nouns website, where a new noun is generated and sold every 24 hours. They are also available on secondary markets such as OpenSea and Rarible.

As of October 30, 2022, Nouns has a floor price of over 60 ETH (~$93,000). One reason for the large price tag is that the supply of Nouns is very limited, as only one Nouns NFT is issued a day. Collections of NFTs like Bored Ape Yacht Club and CryptoPunks typically have thousands of units and only 491 nouns at the time of writing.

did you know?

Despite the high reserve price, Nouns is only the 232nd largest NFT project with $23.3 million in secondary market sales, according to CryptoSlam. by comparison, axis infiniteThe largest NFT project has generated about $4 billion in secondary market sales.

Nouns and Open Source IP

Nouns is open source and released under a Creative Commons CC0 “No Rights Reserved” license. This means that anyone can use the noun name and image to create anything because it’s in the public domain.

You can create Nouns items even if you don’t have Nouns NFTs, and people have created collections of derived NFTs such as Noundles, Lil’ Nouns, 3D Nouns, and NounPunks.

You are also free to add new features to future nouns. The only caveat is that the Nouns codebase, including the art in it, is primarily governed by the Nouns DAO, which votes on which features are included in the collection. The DAO receives all ETH used to buy nouns.

As of this writing, the Treasury Department holds about $45 million. The money is used “for the long-term development and prosperity of the Noun Project.” Noun holders can vote on proposals submitted by other noun holders.

Glossary discussions take place on Discord and the forum site Discourse. The latter is where there is intense discussion around protocol governance.

Modeled after Compound Governance, the successful vote on the governance protocol included a motion to build brand presence in Brazil (expected merchandise), and the design and distribution of a monthly noun comic for distribution in the US (expected to anthropomorphize nouns). Nouns DAO is also one of the crowdfunding backers of the feature film “Calladita,” which is believed to be the first on-chain proposal for a DAO to fund a feature film; the deal will see a noun NFT on the film’s screen.

the future of nouns

Despite the name, the Nouns DAO is not yet fully decentralized. The Nouns Foundation, a “no-owner” Cayman foundation company founded by Nounders, has the power to veto proposals it does not like, such as those that “introduce significant laws or present risks to the Nouns DAO or the Nouns Foundation.” ” This refers to treasury raids, bribes, unnecessary updates to nouns smart contractor trying to control the noun auction process to obtain a voting majority.

It remains to be seen whether handing over IP directly to the community and focusing on brand governance will have a significant impact on its value.

But so far, Nouns NFTs have become an accepted part of the NFT ecosystem, and the Nouns governance structure is working well, taking the project beyond pixelated nuggets dominated by tacos and planes.

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