NFT’s are Nouns now too
Nouns is one of those NFT projects I kept hearing murmurs of around Discords and Twitter. Another Noun showed up in my life when a Proof Collective member posted their new purchase. With a sale price over 70ETH, I needed to understand what’s driving the demand for these little fellas. What I learned was pretty cool, here’s a summary.
Project Mechanics
A new Noun NFT is generated and auctioned every 24 hours. This process will continue in perpetuity. Like Crypto Punks, the art is stored on Ethereum’s blockchain. This is a major differentiator. Due to the prohibitively high cost of storing art on the blockchain, most NFT’s are simply storing a link to the NFT media on-chain.
Art and Licensing
The art is randomly generated for each Noun NFT and and is in the public domain. Putting the art in the public domain is not particularly common but has also been done on projects like CryptoToadz. Comparatively, Bored Apes Yacht Club gives full commercial usage right to the NFT owner. On the other side of the spectrum, Crypto Punks retains all rights around their collection.
One takeaway from Bored Apes, and the Red Ape Family, is when you distribute the rights to the NFT owners, you lose some level of control over the brand. In Red Ape Family for example, Bored Apes were featured with several derivative Ape collections. Nike would never allow their brand to be diluted with knock off Nikes. In short, licensing models are important, and the outcomes of the licensing models are still being discovered. I am optimistic and intrigued by the possibilities presented by Nouns being in the public domain.
The DAO
NounDAO is the DAO used to govern and manage the treasury tied to Nouns. The NounDAO receives 100% of the NounSales and is owned by the NFT holders. Each Noun NFT owned grants you one vote. The treasury is approaching $45 million, with several wild and exciting proposals in the making.
The NounDAO is public, you can view the proposals, and their outcomes here. Some of my favorite proposals that have passed:
Donate 5 ETH each to 6 Charities
Send a Noun to the international Space Station
Feature Noun glasses in a SuperBowl commercial and on real beverage cans.
The Founders
There are ten Noun founders, who are paid out exclusively in Noun NFTs.It’s a pretty stacked cast and I honestly don’t have time to write about all of them. They receive 10% of the supply for the first 5 years. This is about 18 Nouns per founder, each receiving a new Noun every 100 days. I like this model A LOT. It ties their incentives to the success of Nouns and demonstrates confidence in their own work. This is not the usual founders reserving all the rare NFTs up front and unloading on the first buyers in the market. It is a deliberate trickle of profit that is tethered directly to the success of their project.
Final Thoughts
In 10 years, there will be 3,650 Nouns. That will still be a relatively small collection. 182 of those Nouns will be owned by the founding 10 members. Earlier Nouns, and Nouns of specific numbers will likely capture a premium in the market. I imagine single and double digit vowels (the first 99 generated), will be extremely expensive.
NounDao has a small war chest to work with, and the community is small enough where they can imagine, build and execute ideas both in the Metaverse and real world with speed. As I write this the last Noun sold 2 hours and 4 minutes ago at 91 ETH, about $212,000 at present prices. I’m excited to see where this dynamic team and community take this project next.
You can buy a noun and lear more about them here:
https://nouns.wtf/
Happy Investing,
Noochie
Disclaimer: I don’t own any Nouns. So not much to disclaim on this one. Don’t take investment advice from me or anyone other stranger on the internet. ( :
Thank you to my editors @wanderlunging, who is a wonderful writer, find their short stories here