$DOWN ($DOWN Vault token) is an experimental and innovative ‘social-token’ engineered and deployed by BruceTheGoose and DappGoose Labs. The token works similarly to others in the social-token sector, in the sense that the tokens are a method for BruceTheGoose to promote their content, create incentives for various tasks and to reward participants in their projects, social media followers/engagement, and collectors of their cryptoart NFTs, etc. What sets $DOWN apart from other social tokens is that the tokens are intrinsically linked to an expanding reserve of assets by fractionalizing an Emblem Vault NFT in order to issue the token; instead of simply deploying an ERC-20 and finding ways to add value to it afterwards. Full details are available in the whitepaper.
The concept of token-bonding, as introduced by the Olympus DAO and $OHM allows participants to acquire a project or protocol’s tokens at (usually) a discounted rate in exchange for specified LP tokens, or other assets the seller wants to add to their treasury; often with the aim of accumulating “protocol-owned liquidity”. This enables the project to control an increasing portion of their token’s liquidity, as well as offering a passive method of increasing treasury value via trade fees and creating additional incentive for liquidity provision. While this concept has obvious benefits; it’s rarely acknowledged that in order to utilize the monetary value that this method adds to the treasury of the project/DAO/etc., it still requires removal of liquidity, or sale of native tokens to assets that are able to be used as payment for external products/services. While accumulating protocol owned liquidity is a highly effective way to improve market stability and build token liquidity, it’s less effective as a method of funding the DAO’s initiatives, goals, and investments.
As an alternative to the token bonding method described above (as well as possible based on the author’s understanding) $DOWN Vault tokens will be made available via NFTs sold for ETH, stablecoins, or other established tokens that the DAO seeks to increase it’s holdings of.
These NFTs, to be issued on various chains and at various times as determined by the $DOWN DAO, will allow $DOWN to still be acquired at a discounted price in comparison to the market value at the time of deployment; while serving the same purpose of accumulating project-owned liquidity and vested token distribution. To accomplish this, each NFT Bond will entitle its owner to a specified number of $DOWN tokens, which will be airdropped to the wallets holding the NFTs on a weekly basis, until each NFT’s allocation is filled; while the revenue from sales will be strategically divided and used in the following ways:
To ensure that the $DOWN NFT bonds will consistently be a way for interested parties to obtain tokens at a discount, as well as retain value after their token allocations are filled by existing as a scarce collectible associated with the project, they will be created in limited editions, and sales will close after a determined time; with any unsold editions being burned and their token allocations therefore void (as opposed to burning their allocated tokens, which would be of little benefit due to $DOWN’s mechanics).
Sales of the NFT bonds will also create the potential for the project, and for purchasers of the NFTs to access additional value/benefits. Since the NFTs will be the point of reference for the delivery of their allocated tokens (not the wallet that was originally used for the purchase), an owner of a $DOWN bond NFT can sell it (potentially at a higher price than initially paid) as a collectible after the token allocation is complete; or, in the event that the tokens value increases to a point at which the tokens already received meet or exceed the value of the initial purchase, the bond could be resold and entitle the new owner to remaining portion of the allocated tokens.
SECONDARY MARKET SALES:
To ensure that bonds are not purchased on secondary markets under the impression that the buyer will be receiving that bond’s full token allocation, each bond will include ‘traits’ that display details of the vesting schedules; and each round of bond sales’ token distributions will share the same start date (as opposed to the vesting schedule beginning immediately on purchase). By using this format, a potential buyer will know exactly how much (if any) of a specific bond’s token vesting is still available.
As an additional benefit to using NFTs to offer token bonds, the NFTs’ contracts will include baked-in secondary sales royalties, which will be shared by the $DOWN DAO treasury and the $DOWN Vault further generating additional backing for the token, and operating capital for the DAO that doesn’t require the sale of $DOWN or removal of liquidity.
REGARDING THE ART
Additionally, each round of bond sales, and each individual tier made available per sale (currently planned as 3-5 tiers, dependent on the assets the DAO is seeking to accumulate during that round, and on the availability and market value of $DOWN at the time of issuance) will aim to be created with artwork from various artists; which will lead to each round of bonds (and each tier within each round) being unique and adding to the NFTs’ collectability.
While the exact details of the selection process are yet-to-be-determined; the goal will be to have the artwork created by a new group of established and emerging artists for each sale.
Established artists, many of which will be OG cryptoartists (since $DOWN is created by BruceTheGoose, who is an OG cryptoartist themself), will be offered a pre-determined commission for their work, and will receive payouts in a combination of $DOWN and their choice of Eth or stablecoins, ideally at a fixed rate, but potentially as a percentage of the bond sales (which will be determined prior to finalizing the revenue-split template that will be applied to all sales).
DIAMOND HANDS REWARDS:**
Shortly following the $DOWN Bond NFT sales; design and community engagement campaigns will begin for a unique (non-pfp) generative NFT collection which will include unique utilities which are currently TBA.
Anyone who purchased a $DOWN Bond in from the genesis series will be whitelisted for early access to the mentioned NFT mint, while every buyer of a genesis bond who still holds it during the pre-release snapshot will be allowed early access as well 1 free mint.
GENESIS BOND RELEASE
The genesis series of NFT bonds will be made available on a 5-tier format; with each ascending tier providing a higher quantity of $DOWN, at a higher discount, but in lower available supply.
Iron Bond - 500 $DOWN x $0.06 - $30 | 500 Available
**Silver Bond - 1000 $DOWN x $0.055 - $50 | 200 Available
**Gold Bond - 2500 $DOWN x $0.05 - $100 | 100 Available
Platinum Bond - 5000 $DOWN x $0.04 - $200 | 25 Available
Diamond Bond - 7500 $DOWN x $0.0365 - $275 | 10 Available
As the exact details of the revenue allocation, vesting schedules, etc. are decided on and finalized by the initial core contributors of the $DOWN DAO, an announcement will be posted for transparency with no less than 7 days before the start of the sale.
♦️ COLLECTING THIS POST AS AN NFT DIRECTLY SUPPORTS THE $DOWN DAO ♦️