Author name: @nobumei (https://twitter.com/nobu_mei)
<aside> 💡 This page explains NounsDAO.
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In the previous sections, DAO was explained. In this section, we would like to look at an actual example of what a Web 3.0 project should be like, using NounsDAO, a DAO that is actually in operation, as a subject matter.
NounsDAO is a project that seeks to use NFTs to raise funds and create a mechanism for all people to participate in a DAO. In NounsDAO, the DAO is centered around an NFT called Nouns. In this document, we will refer to "Nouns" when referring to NFTs and NounsDAO when referring to the community or DAO as a whole.
Nouns NFT is a generative NFT in which dot-style images are generated by the program. Since the dots are made of SVG images, which are light in file size, they are issued as full-on-chain NFTs where all data is recorded on the blockchain. The combination of dots and full-on-chain is reminiscent of CryptoPunks, but all Nouns are wearing glasses.
Nouns101｜Source
Nouns is a NFT where one NFT is automatically generated every day. The generated NFT is auctioned daily and sold for an average of 70 ETH. The entire NFT generation and auction mechanism is inscribed in a smart contract and functions in a self-sustaining decentralized manner.
https://dune.com/queries/156895/309130
100% of the Nouns auction proceeds are made to go to the NounsDAO treasury, a specification that does not allow for a single penny to be skimmed. While other NFT brands typically keep the proceeds from selling NFTs to themselves, all proceeds from Nouns sales are left to the NounsDAO community.
NFTs have a not-insignificant speculative aspect to them, and the more NFTs that are likely to rise in price, the higher the demand. Strangely enough, people want $40,000 of BTC more than $20,000 of BTC. Because of this characteristic, operations selling NFTs can take advantage of anonymity to unfairly inflate the price of NFTs through bid-rigging and self-dealing. NounsDAO avoids the risk of price fixing through a self-sustaining and decentralized system, since not a single penny is taken out by the management that created the Nouns.
The members who created Nouns are commonly known as "Nounders" and their reward is not NFT sales, but the Nouns itself. Numbers issued in increments of 10 (e.g. #10, #20, #30...) are given to Nounders as a reward. And the term is only for 5 years.
Nounders include the "Loot" developers, who are very famous because they are the avengers of the NFT community.　If they sell their own Nouns they own, the value of the community will decrease because it will lead to distrust of NounsDAO.　It is a very fair mechanism that NounsDAO shares the inherent risk of NFT with Nouns holders by making the reward NFT.　This rule will only be in effect for 5 years, and by that time, there will be people growing up in DAOs to replace the Nouns.
In addition, anyone can join the NounsDAO community, even if they are not a Nouns holder, and can discuss and propose projects through the forum on the official website. If your proposal is accepted, you can use the funds in the NounsDAO wallet to launch a project that will contribute to the development of Nouns, so there is no end to the number of proposals for the NounsDAO.
Since only one Nouns is issued per day and only 365 NFT holders are added per year, this mechanism will work very effectively to increase the number of people participating in the community. And since 1 Noun = 1 vote, Nouns holders will decide whether or not to approve a proposal, and those who are well versed in the Web 3.0 philosophy will eliminate bad proposals and allow good proposals to pass.
Since Nouns has declared CC0 and has waived all rights, including copyright, you are free to create secondary works of Nouns. Fakes may be distributed in the market, but the more fakes there are, the more they become advertisements and increase the value of Nouns, because the blockchain can be checked to confirm the authenticity.