Introduction

In May 2022, when Optimism Foundation announced their approach to governance, many were naturally focused on Airdrop #1 without paying too much attention to the rest of the elements and potential ‘plays’. One such play - Citizens House and Citizenship NFT - is still flying low under the radar.

In this article, we explain what we know about it, why you should be paying more attention to it, and finally how to get it.

Optimism airdrop plays

1 - What do we know about Optimism Citizenship NFT?\ 2 - Who is likely to get one?\ 3 - Why should you want one and how to get it?

What do we know about Optimism Citizenship NFT?

First, recap: Optimism Governance is split into 2 houses. Token House is governed by $OP holders and it was initiated via Airdrop 1. Citizens' House is governed by NFTs but they aren't distributed yet. Houses will keep each other in check and govern some different & overlapping areas.

From Optimism Foundation

Introduction of Citizens' House is a governance innovation and is aimed to include 'contributors' and 'good citizens' that don't necessarily view $OP's price as singular aim of the project. Naturally, we're as excited about this as @VitalikButerin

Summary of what we know:

• NFT is going to be soul-bound (i.e non-transferrable, can’t be bought and sold)

• NFT’s function in Citizens' House: cover public goods funding decisions with 1 NFT = 1 vote

• Distribution:

  • Not for sale

  • To be partially distributed by projects on Optimism (so Optimism Foundation gives to Projects, and Projects hand them out to their communities). Some projects to get their NFTs sooner than others.

  • Supply grows over time and distribution happens during phased stages ('iterative experiments').

  • Wen? Phase 1 later this year (2022)

Source: www.youtube.com/watch?v=t3mPfYR2fbk

Who is likely to get one?

So if the NFTs are to be handed over by projects on Optimism during Phase 1, how will the projects decide on distribution?

This is of course to be confirmed, but we think that NFTs are more likely to go to active contributors (e.g. Discord contributors, Github, governance participants, etc) and less likely to just users of their apps. Smaller communities may still resort to reviewing app usage, depending on how many NFTs they get. But we still think that active contributors are likely to get it first and foremost, since this would be in the spirit of idea behind the Citizenship House - involve those that actively participate in the life and development of projects on Optimism.

This is all an experiment 🧪, so we'll see multiple phases where:

1. Small number of projects get NFTs first

2. They hand them out to their communities

3. Voting happens

4. Foundation reviews this phase and makes necessary changes

5. Next phase begins with more projects and more NFTs

Note that these are just the initial thoughts of the Foundation and things may change, with the exception to it being SBT, not for sale and it being separate from $OP holders and the Token House:

Which projects are likely to get it first?

So who'll be included in the earlier phases? Our bet is on projects native to Optimism, plus those with higher TVL/importance. Foundation showed preference towards them during the Stimpack Governance Fund allocation, so we think it might be the same here.

List of projects native to Optimism:

Why should you want one and how to get it?

All clear so far? Let’s dive into the whys and hows.

Why should you want one?

Hang on a second. If it can’t be sold, why try to get one? There are actually few reasons that we can think of.

• First, think back to the nature of the Citizens' House. Given the 1 vote per 1 wallet and the distribution mechanism, each NFT holder can essentially be viewed as a Congress Senator. NFT holders to decide who gets 20% of $OP token allocation (+revenue from sequencer in future) as retro public goods funding. In this context, NFT holders will be making important decisions, just as politicians decide on government budget allocation.

• Second, as Web3 expands and matures with more people joining in, the trend of moving away from rewarding every user with Airdrops to targeting those with a ‘good’ Web3 reputation is likely to continue. Simply compare $UNI airdrop to everyone who interacted with their contract back in 2020 to $OP airdrop with multipliers for those who had evidence of wider participation in the ecosystem in 2022.

• Overall, NFT holders are likely to have a certain standing within Optimism community and beyond. Your profile will accrue reputation that can translate into Web3 points (e.g. in DegenScore-like apps). This can in turn unlock WLs and other perks.

Even if there's no rewards, this is a perfect chance to get involved in an interesting experiment. There's a level playing field now for those who can't afford big bags of $OP to make impact on voting. This could be your ultimate #ImBroke move, anon.

How to get it?

Here’s your to-do list to prep yourself for the Citizenship NFT:

1. Choose a OP-native project you like from the above list

2. Start contributing in Discord/Github/both

3. Use these apps and participate in governance (where applicable)

Tactically, higher TVL/importance and smaller community may be your best bet to stand out as contributor as such projects might not have as many contributors competing for attention in Discord (Pika? Quix?). However, of course a better way is to pick one that ultimately aligns with your interests and has a community that you vibe with.

Importance - Community Size matrix to aid with decision on which project to contribute to

Closing thoughts

Naturally, there are couple of concerns that may need to be addressed with regards to the Citizens' House.

First, will bribes be an issue, especially given the smaller initial supply that is easier to manipulate? If politicians get bribed in real life, what’s stopping projects bribing NFT holders to vote a certain way and secure funding this way? Similar phenomenon is happening with Curve and Convex bribes, but the NFT holders are likely to be significantly smaller than CRV and CVX holders initially - making vote bribing potentially more of an issue here.

Second, if native apps get bigger allocation, then Synthetix ecosystem is likely to get significant supply in comparison to other projects. Might they end up running the show?

The iterative nature of the process is a good mechanism, as we hope that our concerns get addressed with time or they won't be an issue at all. In the end, bicameral system looks like a step in the right direction as it resembles well-functioning democracies in real life.