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The Nouns DAO Evangelist
A conversation between Jess Sloss and Jacob Horne, founder of Zora, on the latest episode of Building At The Edges.
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The Nouns DAO Evangelist
Nouns DAOs are having a moment in the spotlight, with Jacob Horne —founder of Zora — as one of the more prominent evangelists. Zora recently launched nouns.build — a Nouns-style DAO launchpad that was roughly a year in the making. At the time of writing, there are 34 DAOs on nouns.build all using the perpetual auction mechanic popularized by Nouns. On the surface, the Nouns style perpetual auction appears as yet another highly-capitalized NFT collection. But in the latest episode of Building At The Edges, Jacob argues that the true value of Nouns is the demonstration of a novel on-chain organization.
In recent crypto history — call it 8 months — ERC20 tokens were considered the DAO token standard. But this summer, we saw the emergence of so-called “NFT DAOs”, or DAOs utilizing NFTs as the base organizing collectible. Jacob views this transition as logical, observing that at a fundamental level we’re able to associate the value of the token to the image rather than the other way around. The value of the token has legibility that allows for visible meme proliferation. Nouns is the most celebrated demonstration of this, with Noggles being one of the more instantly recognizable crypto memes.
In Jacob’s view, a critical differentiator of the Nouns DAO model is the anti-fragility that comes with a distributed contributor base. Many DAOs rely on a localized team to facilitate the day-to-day operations and ongoing value creation of the DAO. He argues that this creates a single point of failure while also disincentivizing new contributors to come and create value for the DAO. In a Nounish ecosystem, with the NFT serving as a single vote on the treasury through a proposal mechanism, the possibility for both value creation and meme proliferation are by default infinitely scalable.
Jacob’s core argument for the Nouns model is the recognition that communities exist, communities want to do things together, and they need a medium to facilitate the latter. He points to Purple DAO as an example of this thesis. Purple DAO emerged to gather supporters of the Farcaster ecosystem, pulling their name from Farcaster’s purple brand color. Critically, Purple DAO is not funded or authorized by the Farcaster team. Even though Purple DAO is not directly affiliated with Farcaster, it’s still a meaningfully capitalized organization of people sharing in the ownership and value of the Farcaster Purple meme.
Jacob surfaces that there are still many things to design around within the Nouns model. UX challenges still exist to ensure that members are able to remain tapped into the DAO’s actions. At the end of all, a persistent truth prevails: regardless of the token mechanism, DAO builders must start by building something people want to be a part of.
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