Scale and reduce fraud with native tokens
Enter the Co:Create agreement for newly formed Web3 company GessoLabs. Following a $25 million seed round at a16z Encryption (Andreessen Horowitz’s Web3 venture capital fund), GessoLabs announced their first effort: a protocol instance they believe will help unlock the potential of NFT projects to grow into broader, More active project community.
The factory method protocol (essentially a set of rules that allow data to be shared on the blockchain) NFT creators provide a template from defining four components: NFT minting mechanism, native utility and governance token, DAO (decentralized autonomous organizations) and treasuries. In fact, this allows everyone in charge of NFT projects to create their own encrypted tokens and related ecosystems, decentralized management agencies, etc.
GessoLabs co-founder and CEO Tara Fung now explains in an interview with NFT: “Now you have a fungible token — the local utility and governance token NFT is doing well and there will be demand.” NFT sales lead to demand for the native token, making it a stronger incentive mechanism within its own ecosystem.”
It's a compelling concept. NFT projects combined with native tokens and the infrastructure required for community governance can encourage industry growth and development in unprecedented ways, on a scale wider than any single NFT project (or even BAYC's all-implemented projects).
Chris Dixon, general partner at a16zcrypto, said of the protocol in a statement: “We are just beginning to realize the ability to actively participate in the NFT community. The Co:Create protocol puts creators on the right path to design and implement the most successful NFT community. Challenging components."
NFT creators seem interested in scaling. When designing the protocol and evaluating interest in the project, the GessoLabs team noticed that the founders clearly wanted to help build more sustainable and profitable projects.
"I've talked about a lot of NFT projects," Fung said. “People from Web3 native projects to every brand of the web. They said, ‘We have a vision of the future, we need the roads to where we are going, but we don’t want to build all the roads ourselves. "Providing the infrastructure could be a game-changer.
The open-source protocol also allows creators to control their NFT royalty payouts. Instead of paying in tokens like ETH, NFT sales send these royalties to a DEX (decentralized exchange) and replace them with the project's original token. They are then distributed to more participants, namely creators and project DAOs and buyers.
This particular aspect of the protocol might even help reduce pull scams in the NFT world. Rug pulling is a common scam in which when prices hit a cap, cryptocurrency developers divert funds into the ecosystem and disappear, leaving rather disgruntled investors with potentially little legal recourse.
"This model requires that the NFT project really believes in their long-term investment," Fung pointed out optimistically. “If you want to pull the rug, [you don’t want to] collect royalties on your own native tokens, [you want to] hold them in ETH, cash out, and sail off into the sunset. What I like about the design of the protocol is that it allows high-quality The items of the project are optional to enter, while the carpet-style ones are optional to exit."
How do NFTs balance project success and exclusivity?
But what about exclusivity and scarcity? Wouldn't a community protocol specifically aimed at expanding NFTs like this make the project less attractive and valuable?
While it does introduce more human NFTs it doesn't necessarily mean a drop in value. It can actually increase it. Just like we did in BAYC and ApeCoin as we can see, the expansion of the universe and this new token created a NFT more demand in the community, Otherdeeds secondary sale (Original purchase only $APE achieve more A few days after the multi-Otherside launch, more than 200,000 ETH ($568 million).
This is great news for NFT project creators, but for those who find themselves overpriced by well-known projects, buying popular NFTs is simply not an option. Otherdeeds’ initial drop was only available to those with tens of thousands of dollars in liquid cryptocurrency. Likewise, if you want to own a boring ape, you'll need to pay at least $88 ETH, which equates to nearly $21,000.
The more decentralized advantage of introducing internally linked tokens with NFTs is that it removes financial barriers. A single $APE of ApeCoin currently costs just over $8 and any token holder can access BAYC worlds even in some cases. For example, the coin is equivalent to the right of ApeCoinDAO to vote on community proposals in the governing body.
The basic premise behind this example is similar to what a protocol like Co:Create aims to do, albeit on a larger scale and in a more diverse way, but spread across many projects. This makes it more relevant to the wider NFT ecosystem; people can decide whether they want to test specific NFT projects and their communities in a low-financial-risk way before participating in project governance to play a bigger role in the community by purchasing NFTs or through their DAOs .
“The goal here is not to reduce the exclusivity of NFTs,” Fung explained. "They can still be the most exclusive membership level in the community. But when you're just NFT it does limit the contributors and participants in the community, but you can't identify or incentivize them to create value for NFT holders. Some people may want to be NFT Holders may become part of the community, but they can’t get there. Nobody in the NFT community is saying that NFTs should only be for the wealthy.”
Just as specific NFT token holders of this project will have the same say in its governance through its DAO GessoLabs protocol NFT projects will have a say in governance at Co:Create at a scale that will be welcomed and successful by the project . The total value of these projects will also be reflected in Co:Create's own native token ($CO).
The GessoLabs protocol is scheduled to launch in the fall and is designed to support a small number of NFT projects early on, before expanding significantly in the future. It's unlikely they'll be the only family of Web3 companies aiming to capitalize on the industry's continued expansion.
It will be very interesting to see how the NFT world develops next year, but it will likely only grow and diversify as the once little-known blockchain-based technology continues to find its way to mainstream. This is a future that Fung and many others are eager to see and help create.
"One of the things that appeals to me about NFTs is that they're not just digital versions of collectibles," she said. "They can do more and be smarter, unlocking goods, services and benefits. NFT largely means 'digital images.' But they can be anything unique."
In the end, it is this uniqueness that still defines NFTs, despite their somewhat erratic evolution. Gharegozlou Life is irreplaceable, and the digital world is just starting to catch up to this reality.