Will DAOs replace Corporations?

Or, how NounsDAO plans to take over the world

September 21, 2021

I first heard about NounsDAO from this tweet:

Just catching up on the business news.

"Nounder *vapeape* told Decrypt today that the project came together following a Twitter prompt by fellow founder Punk 4156, a notable NFT collector who identifies as the CryptoPunk that he owns."

My first thought: this is word salad and I have no idea what it means.

My second thought: I am amused by the idea of a pseudonymous founder who identifies as a CryptoPunk NFT that he owns. Kids these days!

Then I found out this project, NounsDAO, has in less than two months amassed a community-controlled treasury worth $20M, growing by roughly $500K a day. (My third thought: What!?? I am ngmi 😭)

Here’s how it works.

On August 8th, 2021, Punk4156 and his team deployed a smart contract to the Ethereum blockchain that randomly generates a new NFT digital avatar (called a Noun) every 24 hours and auctions it off to the highest bidder. 100% of the auction proceeds get sent to a community treasury that is controlled by Noun owners. One Noun = one vote.

The Nouns look like this:

So far, the most expensive Noun was the first one, which sold for 613 ETH ($2.1M USD) to an anonymous NFT collector named xaix.eth. The cheapest Noun was sold a few days later for 36.69 ETH ($130K USD) to richerd.eth. After that, the price of Nouns began to rise and then stabilized at ~150 ETH ($532K USD).

Here’s a graph of the winning bid amount in ETH for each Noun so far:

(Source: Nounalytics)

The obvious first question is why are people spending so much money on these Nouns?? I had to find out.

So I started lurking in various self-proclaimed “degenerate” corners of Twitter and Discord, where spending millions on NFT memes is cool and using a real name or photo is not. These communities have all the exuberance of revolutionary France, and fully see themselves as destroying the Ancien Régime of law, culture, art, and power defined by modern democratic capitalism. The new ideology is crypto, and it is in the earliest stages of reshaping society.