Fantom Hamster Heroes: The First NFT-DAO on Fantom
To understand what is an NFT-DAO, you have to first understand what is a Decentralised Autonomous Organisation (DAO). I believe this article by Forbes explains it perfectly:
An NFT-DAO is a DAO in which members are holders of the NFT and its members decide what to spend with funds that are allocated to a community wallet. They are given exclusive access to a channel (usually Discord channel) through a verification bot (Collab.Land) where they express their ideas, share their alpha, value-add to people’s lives whilst forming a community — akin to a digital country club. Examples include teaching specialized skills such as marketing, public speaking, and virtually every hobby possible. Musicians and artists can also seek compensation in the DAO if their work is valued by the community that causes a proposal to be raised by the DAO to reward them. The possibilities are endless and truly intriguing. An NFT-DAO differs from traditional DAOs because members can bond and network with each other on Discord with their daily life updates which build intangible attachment and loyalty to a community.
Largely driven by the community, a NFT-DAO has as much potential to fail as much as it can rise depending on the contributions every member makes and how well it organizes itself and this brings us to David Phelps 3 key questions on building a DAO:
A. “The Revenue Problem: In DAOs, memberships and subscriptions are bought as tokens from other members. The DAO doesn’t get any revenue. Do they need to find other ways to monetize, or do they need a cut of resales?”
Answer to A: A large community wallet. The team believes that for a DAO to become valuable and retain wealth, it needs a large and stable source of income, and not just 5–10% of royalties, thus we’re allocating 50% of sales and royalties to the DAO wallet to build a high capacity for wealth creation, action, and a strong reserve.
B. “The Compensation Problem: Groups are the best judges of individuals’ compensation based on performance. But individuals will feel best when they have the right to determine their own compensation in advance. Who should decide how much they earn?”
The team hopes that the DAO would follow David’s solution of using the Gitcoin-grant model: DAO members can propose projects with milestones and set a rate for their work. At milestones, the rest of the DAO can vote to approve payment (or have it automatically sent upon completion of on-chain work).
The team also recognizes that the DAO may not reach this level of participatory voting, and hence will kickstart voting at the easiest levels to build momentum. We are looking to use https://snapshot.org/#/ to raise proposals. For the start, a yes/no question. Then we’d answer a question to which options we want to call for action when the first question is answered yes. For example, do you want the DAO to donate to a charity? Yes. How much % of the DAO’s funds is suitable? 2%, 4%, 6%, 8% or 10%. Which charity etc? We would first observe the optimal level of time needed to maximize participation to tackle yes/no questions and multi-layered proposals. Then we can move on to milestone proposals. When the HamsterDAO has matured, we believe it can decide upon its own preferred voting mechanism.
Ideally, the approval of compensation/bounty will be integrated with multi-sig wallets and made automatically through smart contracts. However, it will take time and effort to develop this. The team may have to do this manually at the start with centralized decisions/voting methods through discord bots. Rest assured, we’d be doing up the verification bot equivalent to Collab.land first.
C. “The Incentive problem: DAOs without incentives = ppl join to take initiative, but it’s hard for them to coordinate. DAOs with incentives = ppl are easy to coordinate, but not there to take initiative. So does the right level of incentives depend on the level of centralized leadership?”
Answer to C: The team recognizes that the hardest part of forming a DAO is in its birth when it can fail if the community takes initiative, but does not coordinate. Eventually, capitulating into one that largely focused on the price floor for investment returns. The team plans to allocate 6,000 FTM from the developer’s fund to 15 value-adding members of the HamsterDAO to kickstart an active community, paid with the compensation model. Per member, 200 FTM at the first milestone, and 200 FTM at the 2nd milestone. Applications of any specialized skills are acceptable and would be reviewed by the developer’s team.
By the way, we’re looking out for good public speakers who can host twitter spaces regularly. Somebody good with analytics of our re-sales. Good musicians who can compose hamster-rarity-adventure-themed music and artists who can help create twitter headers or derivative art.
Summary of Fantom Hamster Heroes Financial Structure
After some study, the team believes that the developers can help raise the HamsterDAO with a few guiding principles (https://twitter.com/FantomHAM/status/1444510528915738629?s=20) and they are:
1. A transparent and secure treasury — Clear Frontend/UI showing transactions for accountability backed by cold wallet storage.
2. A large and stable revenue-accruing treasury — Large size of community wallet and financial diligence of community
3. Clear and easy voting mechanism — Discord organization and Snapshot
4. Active and participatory voters — Incentivisation and some luck
5. A vibrant community for intangible feelings — lots of luck