TreasureDAO is the greatest project you’ve never heard of

10 min readJan 7, 2022

TLDR:
This is a 10-minute read on why TreasureDAO will become one of my top bets in 2022.

The thought leadership and fervent commitment from John and the core team are what inspired me to get up and write this article. Thank you for gifting us this wonderful project.

Today when we look at TreasureDAO, we imagine Smol Brain or a gorgeous marketplace that houses multiple NFT projects.

With so much noise that screams for your attention and quests to complete to get a free NFT, it’s easy to get lost and not understand what Treasure is set out to accomplish.

A brief history

Treasure originally began as a 10,000 free-to-mint Loot-inspired derivative led by John Patten and Yuta.

The idea was to flip mainstream NFTs and games on its head by starting not with the finished product, but the raw materials. What this enables is to allow communities to form around the imagination of what these raw materials can become, and build different tribes and games that can progressively work towards achieving their own community-driven gameplay within one singular metaverse.

As shown above, each Treasure NFT contains 8 forms of monies that can be extracted as resources used in the world.

In a short 3–4 months of buidl, It has outgrown Loot significantly and quickly developed a life of its own, evolving into TreasureDAO.

The team had demonstrated the ability to bootstrap the protocol w/o accepting any VC funds, execute on their product vision and what I’m most impressed with is the teams’ ability to communicate their vision, beliefs, and values to the community at every step of the way with a level of depth that inspired a wave of die-hard fans like myself.

What is TreasureDAO?

TreasureDAO aims to become the Nintendo switch of the metaverse. Think of them as a game console where any new or existing projects can plug their cartridges into their console and enjoy their superior technology; a strong reserve currency $MAGIC, a marketplace, and cross-game composability.

Treasure NFTs are different forms of monies that serve as the base foundation on which all games are built.

Ethereum could not take its place as the reserve currency of the metaverse because if they had set out to do so, they would have already created game metaverse. TreasureDAO on the other hand is the right building block in which all new metaverses are created because they have introduced a dance between two resources; $MAGIC and Treasure NFTs that are intentionally designed not to be able to operate one without the other.

Treasures and $MAGIC are dual resources that buffer each other’s value. Treasure holders depend on $MAGIC holders to give them $MAGIC in order for their treasure to be productive by producing consumables or upgrade. $Magic holder depends on Treasure holders for treasure resources in which allows them to mine more $MAGIC. Each group provides necessary value to the other. And as the supply of $MAGIC begins to decrease over time just like ETH and BTC, the base value of each type of asset rises in lockstep.

The utility and mechanism of Treasure are similar to that of TERRA/LUNA and OHM/sOHM. — Every great token case depends on some kind of duality. TERRA/LUNA and OHM/sOHM are the best recent examples of how the equilibrium between counter-parties creates the solid floor on which a larger economy can be built — Think TERRA/LUNA for the metaverse.

What makes TreasureDAO different from its peers?

Most GameFi starts out as a standalone closed ecosystem where the entire player experience is centrally controlled by a single organization with a huge emphasis on gameplay.

Instead of focusing on gameplay, TreasureDAO focused heavily on 2 things:

Engineering the perfect monetary policy, economic design, and game theory in order to create to fuel the ecosystem and make its resources productive.
Treasures’ belief in grassroots building, a strong emphasis on building a great culture, and community building. The team demonstrated thought leadership, worldbuilding, lore crafting that had attracted many projects to build on top of their world that align with their vision.

Treasure’s Innovative approach to tackling liquidity incentive design — Defi liquidity Problem

Liquidity is the lifeblood of any token. A highly liquid market results in higher trading volume, stable prices, and lower volatility. An efficient market attracts bigger capital and larger participants. Resulting in more capital for the DAO.

Liquidity is King.

The lack of liquidity, on the other hand, results in large price swings, high price volatility, and unstable prices that would scare many investors and builders away from participating.

TreasureDAO had a brush with extremely low liquidity that almost threaten the existence of their protocol but was saved by the love of the early community that pooled valuable resources to see it through.

As we have seen, traditional liquidity mining is a way for a protocol to bootstrap its liquidity by incentivizing yield farmers with high APY (%) and diluting their token supply. In the short term, this may seem like an optimal strategy for an efficient market, but based on Nansen’s insights, it proves to be unsustainable, while inviting mercenary capital. As soon as rewards dry up, the capital leaves. Mercenary starts dumping on the token, and this creates a negative flywheel effect.

To counteract this, there is much innovative liquidity as a service (LaaS) approach offered by DeFi 2.0 protocols such as Tokemak and OlympusDAO. Since the focus of the article is on TreasureDAO, I won’t go too much into detail but u can check out an article detailing the different approach to LaaS and their respective trade-offs by Fei Protocol

On a high level, TreasureDAO plans to address the DeFi liquidity problem by framing liquidity as the game’s core objective.

There are 3 main metaphoric examples introduced by the team to incentivize liquidity provisioning — Liquidity as weather, liquidity as a time, and liquidity as a measure of spatial reach. However, I would only be diving into the first example.

Liquidity as weather — Low liquidity is akin to extremely bad weather in a game that could affect the health of the characters or the game-play. In order to reverse that, players would have to perform some form of action that may take the form of acquiring more life or mana potions. In attempting to do so, players do not need to understand the abstract concept of providing liquidity as the back-end process would already have done it for them.

Imagine if all games built on TreasureDAO adopted this framework, how resilient would $MAGIC metaverse currency be.

Leadership has to scale faster than your product — John Pattern

Active governance and control

We are often sold the dream of a Decentralised Autonomous Organizations (DAOs) — A community of builders, creators, and protocols all coming together with aligned incentives and common interests, flat hierarchy with no leader or single-point failure, and run almost entirely by code.

DAOs are far from their ideal state and are not completely autonomous. The ugly truth is most DAOs continue to operate with a central core team driving all progress without setting any framework that encourages bottoms-up participation.

DAOs need to create decision frameworks to ensure that it is governed effectively and proper financial incentives are thoroughly thought through to reward great participation & contribution so that when others see it, they start contributing too and it becomes a much more positive flywheel.

The question that TreasureDAO is seeking to answer is how can we make our most valuable asset productive; our community.

Bard Program for Lore Writers
Incentive structure & Governance model that stems from the idea of the Proof of Stake consensus model run by validators from various L1 POS blockchains — Cosmos / Polkadot / ETH 2.0

Other Initiatives

By bringing these responsibilities out into the open, we are no longer dependent on a single company to achieve the goals of the entire ecosystem but can leverage open-source contributions from anyone on the internet.

Web3 unlocks a third door where not only do community members come to play in a project, but also worlds in which they have financial upside, ownership over revenue-generating businesses & valuable digital assets, and defined jobs & responsibilities.

The founding team demonstrates thought leadership, serious commitment, and service to the community

John (Head of growth at Osmosis) + Yuta (Serial competitive gamer) — + @_gaarping (tokenomics/growth strategist) are highly technical founders. An update; Yuta has since left TreasureDAO in pursuit of other ventures.

At launch, not only did they give away their IP (Free-to-mint NFTs) for free, they welcomed other community groups (Loot, n project, AGLD) to stake their assets with them and accrue $MAGIC rewards.

$MAGIC liquidity pool was entirely self-funded & bootstrapped by the initial core team w/o raising any VC fund.

Their love and commitment to the protocol had touched the hearts of early contributes + whales to do the same and join them in their course.

Cash Grabs VS Sharing Value

Instead of the conventional approach of most popular metaverse games selling a big, wild dream of shipping a very polished AAA game with lengthy timelines, The team takes a nimble approach of shipping an MVP. They had shown the world they don’t need a polished AAA game to make a dent in the universe. A Minimum Lovable Product (MLP) is enough to complete the economic value accrual loop.

The story of SMOL brains

Here’s how it works. It starts with 2 monkeys and a piece of land. You are able to stake your monkeys and earn 10 IQ each day. The more IQ your monkeys accumulate, the smarter it gets, thus able to gather more resources and build its own Smolverse — bridges/boat/helicopter. By staking it, you will earn spontaneous NFTs that may be valuable.

Eventually, the staked monkeys would be mature enough to mate and breed, giving birth to a baby monkey that would down the road aid the parents in fetching coconuts from the trees and accrue $magic tokens

What’s I love about SMOL is how easy it is to understand what they are doing — Even a 5-year-old kid gets it immediately. A simple pixelated space to allow users to tangibly visualize the growth of their monkeys and land over time.

For the first time, I actually felt a real attachment to the NFT I held. Every subsequent new in-game asset airdropped to me seemed purposeful and carefully thought out.

The best part of it all? The mint is completely FREE. In order to get whitelisted, the community has to work hard for it by manually drawing a SMOL on a piece of paper as a “Proof of work”. The benefit of this approach is 2 folds; given all things equal, nobody should be paying money to play or win, and the second is attracting missionaries and not mercenary capital by requiring some sort of labor that cannot be botted.

From the time of writing, a FREE to mint SMOLbrain is worth 8.0 ETH ~(30k USD)

Create a world where others would like to be part of and not the other way around
Most metaverse I’ve interacted with makes me feel like I’m in a lobby before the game starts. I don’t find meaning in spending time in them. Nobody seems to know exactly what most of the in-game / metaverse resources actually do but everyone is minting them anyway. (Mainly speculation)

Closing Thoughts

To give perspective, it has only been 5-month since August 2021 when the project was unofficially launched as a fun experimental project that has now developed into a raging bull that is going full steam. The team has expanded from a size of 2 to more than 20 members in their core team, and dozens of active working groups building on Treasure’s mission. I can’t even fandom what it would be like 1 light-year away.

And above all, watch with glittering eyes the whole world around you because the greatest secrets are always hidden in the most unlikely places. Those who don’t believe in magic will never find it — Roald Dahl

2022:

Building the Nintendo; Bridgeworld V1, the central metaverse of Treasure which all metaverse economies can be built and connected.
A generalized marketplace as an Opensea competitor
Partnership Integration: Smol-verse, Life, Mushrohms, Ether Orcs, Imperium, Enjoyooo0ors

Don’t bet against TreasureDAO.