Sunsetting our NFT program with Community Rewards
Introduction
When we originally set out to create the BarnBridge ERC-721, we were generally curious in how we could use NFTs to track early community participants. We also were generally curious about the use cases for NFTs more specific to #defi as opposed to the one of a kind art related space.
Since our announcement of the program in early October of 2020, it’s safe to say that not only did BarnBridge come onto the scene in a bigger way than any of us could have previously expected or even imagined, NFTs also exploded onto the scene. There are a lot of learnings here.
Rewarding Community Participants
So let’s segment this out and get the major announcement out of the way first because it’s the most important part of this announcement since it affects circulating supply and the breakdown in community rewards. While the BarnBridge ERC-721 project was started with a loose idea in mind that we would reward the holders with more than just artwork, we wanted to see where it went before we made anything official. I think it’s safe to say that the program exceeded any of our expectations. We started “knighting” members of our Discord who were active participants and we gave them a special tag and moniker: Sers (and lady’s albeit DeFi is still around 80–90% male participants and so is our Discord). This essentially empowered early stage participants to have “reputation” within our system and naturally, they stepped up to the plate without anyone really knowing we had plans to reward them longer term.
Another thing happened as a result of our launch — there was so much TVL in our contracts that some of the $BOND community members simply couldn’t compete with the large deposits in pool 1 and many of them thought they had found a diamond in the rough in BarnBridge and were washed out when very large market participants with massive amounts of liquidity found out about BarnBridge at the same time. Some of them lost interest and focused on other areas that could bring them opportunity and better involvement incentives.
Given that crypto is a space where anonymous avatars like Chainlinkgod can provide value without even using their own name, many of these early stage participants were anonymous. We didn’t know their real names or their real identities. However, avatars change, and Twitter handles change so how could we keep track of who was who longer term?
Enter the BarnBridge ERC-721: it was a novel way to keep track of early supporters, borrowing a bit from $SOCKS and Uniswap. It worked like a charm in helping us to keep track of everyone. So mission impossible is now mission complete.
Not only did we use the BarnBridge ERC-721 program to create some of the best meme arsenal in the industry, we also compiled a list of over 100 individuals who helped us in the early stages of our existence. Since we really wanted to reward participants 1 to 1, we moved to Gitcoin and USDC/DAI grants to reward meme creators (since it’s obvious Ser Homer Shillson, Ser Daboz, and Ser Zky were going to have dozens of NFTs if we kept doubling up rewards — and we knew you really only needed 1 NFT, and having 2 NFTs provided zero marginal utility).
So now the time has come to reward the early community who helped us bootstrap the community we have now.
We’ve compiled a list of over 100 addresses and removed the names to save them from doxxing (sorry Nansen). We’re going to open a 72 hour period where we invite you to bump us if you feel like you deserved an NFT and helped early on and went unnoticed (it’s not or never and naturally some people will have slipped through the cracks albeit our diligence in tracking things). During that 72 hour period we invite the Sers, and the early stage participants to check that their wallet is on the list for the incoming airdrop.
How many $BOND tokens will each wallet get? Well, for now, that depends on how many people filter in from here. I doubt we missed 20 people so my guess is we end up with around 110 addresses who will be rewarded in $BOND.
How many $BOND tokens are going out? We’ve allocated 12,000 $BOND (0.12% of the total supply) for this initiative so it will be split evenly between all addresses and airdropped to the community after the 72 hour period.
These 12,000 $BOND tokens obviously are coming from the variable community incentives pool given that they are for the community.
How do you claim?
Well we are doing an airdrop for the rewards to you but you can check here to make sure we have the right wallet for you:
You have a 72 hour window from when we publish this article to change your wallet if you so please or think we made an error.
Don’t message me if your wallet is right — just message me if it’s wrong (you can reach out to me via Discord).
Why are we sunsetting the NFT program in general? Why now? Why not keep it open for rewards?
Good question. Well, to start, I lose my status as a benevolent oligarch as soon as we hand over the DAO and I want to reward community participants while I can. I think this is the right thing to do.
Second, I have full mint ability to make as many NFTs as I want from my address. While I can hand that over to the DAO, I don’t want to because I am scared about where this program may evolve and I personally think it’s bad for the project, so I’ve decided not to. Let me expand: while we originally only planned on having 200 NFTs minted, I don’t even think we minted that many because they’re expensive as hell right now with gas prices.
However, some of the community started to talk about making the NFTs some type of reputation multiplier on our DAO and I actually think it’s a terrible idea but can’t really stop it by doing anything other than saying “I can print as many of these as I want so that’s a bad idea.” The community can make their own decisions post handover but I think it’s important that people really only need to keep up with one thing in regards to BarnBridge governance: the $BOND token.
This was actually a massive concern of the team (a two token ecosystem) from the very beginning and I told them if that becomes a problem, I’ll course correct and fix it. This is me doing that.
Furthermore, you can tell by some of my actions like launching Bond.Bet and making the $BOND token governance from that — I don’t want to have a million different tokens to manage. Launching one token is hard enough and that is what I want to focus on. So I don’t want my efforts to push forward the protocol to result in money grabs and more tokens and tickers — the NFTs and Bond.Bet being no different from each other in that respect. We’ll announce more information about Bond.Bet and other partnerships we have been working on later in the week, so stay tuned for that, but also understand — the BarnBridge DAO governance is the most important thing we get right in February and it’s already hard enough to understand what we are doing at BarnBridge so adding layers of complexity of reputation and additional tokens is a nightmare waiting to happen. I also don’t like the regulatory aspect of it.
So I’m making the unilateral decision to sunset the BarnBridge ERC-721 efforts now that the participants of the BarnBridge Launch DAO have empowered me to reward the early stage participants. I hope you accept the reason for my actions here and understand they are well thought out and in good intention.
So what did we learn?
To start, we learned that we have an amazing community. Second, is a few things about copyright law that I wish I had known when I started this.
Third, we learned we can make cool ass NFTs if I do say so myself.
More importantly, this program affected the actual financial protocol we are building. It was the precursor to the Standards that Akin built for BarnBridge (and a major reason we brought him on full time). Most of what we’ve done in crypto & DeFi from 2016–2020 had to do with asset-based products (ERC-20s). You can think of the fungibility of ERC-20s as being similar to equities or commodities (albeit I am in no way suggesting ERC-20s are equities here). What I mean by that is that you can own 1 ounce of Gold or 1 share of Tesla, and for the most part, that is 1 to 1 fungible with another ounce of Gold or another share of Tesla.
Fixed income and debt-based products are completely different from this in traditional markets. Illiquid debt essentially means non-fungible. It’s also not easy to just sell a mortgage 1 to 1 to another person. A Ford 5% coupon AAA-rated Bond can have many different issuance dates, maturity dates, and rights attached to it. This is very different than how an ERC-20 operates.
So when we release the SMART Yield product in February, you’ll see that the senior tokens are essentially NFTs. I’m working with some groups to build an interface for liquidity on this (since non-fungible can often mean not-as-liquid) but it’s important to note that no sToken will be 1 of 1 identical to another sToken. However, what is interesting about them is that they represent proofs of liquidity as your risk/reward exposure to a share of a cash flow that is paid out as an ERC-20. This makes them more fungible because, with good standards, you can figure out exactly what is in the representative NFT. We may have figured this out on our own without the community NFT program, but it definitely was a good start in our exploration.
I think it’s important to note that we also used this knowledge to champion standards with Opium (and in conjunction with Aave) where we essentially signaled to the industry: “hey not all of these protocols are issuing debt-based instruments the same way and it’s going to create a mess for secondary markets if we don’t start thinking about this.” While it may be boring and not as fun as the “MeMeZ” it’s absolutely imperative we get this right as an industry and some of the bigger players in the space from liquidity providers to blue-chip protocol leaders realized we are here to build for the long haul and we are thinking about the types of things people should be thinking about.
Andrey from Opium said it best “anyone can create a ponzi token — we’re trying to create standards that show we’re planning to be here for years and we want to create structures for new participants to come into the market and build without having to figure this all out themselves.”
We think this is a major head start to how NFTs and DeFi collide as DeFi Squared (DeFi²) enters into the period of D64. I don’t think anyone but a few know what I mean by this paragraph so… more to come of that in the Bond.Bet article — stay tuned.
So while the BarnBridge ERC-721 was fun, and we are sunsetting the program… it will live on in our products & our community.
And we think that is pretty cool.
