AIP-320: The Sweep: For Accelerating Web3 Gaming Adoption

Final AIPs Rejected AIPs
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Proposal Name: The Sweep: For Accelerating Web3 Gaming Adoption

Proposal Category: Core: Ecosystem Fund Allocation

Abstract

It costs $9 million to sweep 100 Bored Apes and 200 Mutants. I propose we buy them, hold them in the treasury, and allow game companies to submit proposals requesting them in addition to or in lieu of Apecoin for game prizes and rewards.

Author Description

I’m an engineer by trade and I trade digital collectibles as a hobby. I’ve been a member of the Apecoin DAO since its inception and a member of the Bored Ape Yacht Club since May 2021. I’ve spent 6 years as a product design engineer and I hold 4 design patents.

Motivation

The intent is to ultimately increase the demand for Apecoin. People need incentives to buy Apecoin and participate in the ecosystem. My idea is to create an Apecoin DAO holding of Bored Ape NFTs. These NFTs can be requested through AIP proposals as an option for prizes in Apecoin games for example. They would have to be approved for grants in future AIP proposals as a community. This way, we are not limited to granting NFTs to existing games at the time of this AIP submission.

The Apecoin DAO also gains $9 million worth of assets that are not Apecoin. This means we would now have $9 million in assets to grant through AIPs that do not require the sale of Apecoin to execute. That is significant and helps to offset the effect of the initial swap to ETH for the NFT purchase over time.

Rationale

One of the biggest guiding principles of the APE community is to drive culture forward into the metaverse. Bored Apes have stood at the forefront of driving culture forward in Web3. I think a DAO holding of Bored Apes allows us to offer an asset, through grants, that will motivate participation in the Apecoin ecosystem. 300 Apes as prizes creates a significant incentive to purchase Apecoin and compete in Web3 games.

Benefit to ApeCoin Ecosystem

I’d love it if we were in an environment in which there were multiple play-to-earn games with significant prize pools creating Apecoin demand for their mints (assuming powered by Apecoin / Apecoin only mints). I find it hard to think of a better use for $9 million dollars in DAO funds than incentivising new entrants to buy Apecoin to compete for valuable prizes (Ape NFTs).

$9 million dollars was arrived upon after calculating the rough cost to purchase 100 Bored Apes and 200 Mutants. The cost of these NFTs is highly volatile so this AIP specifies a dollar amount to spend rather than a number of NFTs to purchase. The number of Bored Apes and Mutants is proportional to their maximum supply, and large enough to create attractive prize pools in the Apecoin ecosystem.

Specifications

The $9 Million USD in Apecoin will be transferred to a DAO controlled wallet with the same specifications as the treasury. The funds will be use to purchase the cheapest Bored Ape and Mutant Ape NFTs available to the open market utilizing the following guidance:

  • $6.18 million allocated to sweeping Bored Apes until funds are exhausted.
  • $3.82 million allocated to sweeping Mutant Apes until funds are exhausted.

The NFTs will be purchased using an aggregated NFT marketplace (i.e. Blur). Any unused funds are to be returned to the DAO treasury. These NFTs will be held by the DAO until requested by future AIPs.

Steps to Implement

  • Create an Apecoin DAO controlled wallet
  • Fund the wallet with $9 Million USD in Apecoin and enough ETH for a Uniswap transaction (0.01 ETH conservatively)
  • Swap the Apecoin to ETH on Uniswap
  • Utilize an aggregated NFT marketplace to purchase $6.18 million dollars worth of the cheapest Bored Ape NFTs available on the market
  • Utilize an aggregated NFT marketplace to purchase $3.82 million dollars worth of the cheapest Bored Ape NFTs available on the market
  • Return all unused funds to the Apecoin DAO

Timeline

  • Allow 1 week for the creation and funding of the DAO controlled wallet after the passage of this AIP
  • Allow 24 hours after the creation of the wallet to purchase the NFTs
  • Allow 24 hours after the purchase of the NFTs to return the funds to the DAO

Overall Cost

$9 million USD

5 Likes
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I don’t see this question of sweeping BAYC/MAYC prices very well, and also how would you do that without selling the Treasury $ape?
The entire value of DAO is in $ape.

6 Likes
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There’s been different versions of this before which have comments like what you will receive. This is an obvious wealth transfer from the DAO to BAYC/MAYC holders. There’s literally no benefit to the DAO.

6 Likes
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The intent is to ultimately increase the demand for Apecoin. People need incentives to buy Apecoin and participate in the ecosystem. My idea is to create a DAO holding of Bored Ape NFTs. These NFTs can be requested through AIP proposals as an option for prizes in Apecoin games for example. They’d have to be approved in future proposals of course as a community.

How do we pass any AIP grant without using our Apecoin? If there are better ways to spend our treasury let’s get them passed together! I’m not sure why this doesn’t benefit the DAO while other AIP grants do. Plus, Bored Apes are some of the largest supporters of Apecoin and the DAO.

1 Like
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The intent is to ultimately increase the demand for Apecoin.

How does this increase demand for apecoin?

My idea is to create a DAO holding of Bored Ape NFTs. These NFTs can be requested through AIP proposals as an option for prizes in Apecoin games for example. They’d have to be approved in future proposals of course as a community.

As it stands, anyone can request the funds to buy BAYC/MAYC for their AIP. We don’t really need to pre-buy it.

How do we pass any AIP grant without using our Apecoin?

We definitely have to use APE for AIPs, there’s no way around it. The issue is, are we using it for the benefit of the DAO.

To put it another way, there are way more APE holders than BAYC/MAYC owners. The DAO buying these NFTs, especially the 100s you’ve requested does nothing for the APE holders. We lost value of APE just to get some NFTs and helped prop up the floor price of BAYC/MAYC. That’s what I meant by “literally no benefit to the DAO”. If someone wants to use the NFTs for an AIP, within that AIP they can request funds to purchase it.

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I don’t think that’s the best use of funds. It would basically be exit liquidity for flippers and allow a select few to make a profit. I don’t think it furthers the DAO.
I think Machi had suggested sweeping to donate to museums. I would argue many holders would be happy to loan their NFTs for initiatives like that.
But just buying a bunch of apes and mutants would only benefit flippers and short term profit seekers in my opinion.

4 Likes
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I think the question of how this will create Apecoin demand is a fair one. I’m trying to articulate it in my previous messages but I agree it’s non obvious. Similar to the demand Wreck League mint is creating, I’d love it if we were in an environment in which there were multiple play to earn games with significant prize pools creating Apecoin demand for their mints (assuming powered by Apecoin / Apecoin only mints). I find it hard to think about a better use for $9 million dollars in DAO funds than incentivising new entrants to buy Apecoin to compete for valuable prizes (Ape NFTs). And yes, as a Bored Ape I’d prefer we buy Apes. My incentives there are obvious, but I also own a bunch of Apecoin and would benefit more from Apecoin pumping long term than my Ape.

As a thought experiment, do you think demand for Apecoin would be higher or lower heading into this Wreck League mint if their first tournament was giving away 10 Bored Apes in prizes? How about 100 Apes? Just using that project as an example for arguments sake.

Our treasury is in Apecoin. We have to be creative in any AIP regarding how we spend Apecoin to increase demand for Apecoin. It also seems like we can’t create profitable initiatives to take in income (not at all sure about that). We also obviously can’t simply write an AIP to sweep Apecoin with our Apecoin, we have to grant and spend it.

I very much do appreciate the feedback you all are providing, especially the constructive.

1 Like
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Something worth mentioning. Yes, the treasury would lose $9 million worth of Apecoin, but we also gain $9 million worth of assets that are not Apecoin. This means we would now have $9 million in assets to grant through AIPs that do not require the sale of Apecoin to execute. That is significant and helps to offset the effect of the initial purchase over time.

1 Like
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hi what would be the point of sweeping away the monkeys or mutant creating a false hype using DAO money. I don’t think the monkeys need that, we’re just in a bear market at the moment.

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Thanks for the question. I wrote a couple of replies going into a bit more detail on the rationale. Feel free to give them a look and let me know what you think. What I will say is we can’t blame the underperformance of Apecoin on the bear market. We have to acknowledge the lack of proportional demand vs Ethereum and Bitcoin for example. Remember, Bitcoin is up 40% on the year, not down. I think offering 300 Apes as prizes in Apecoin only games will drive demand for Apecoin as players buy to compete. Curious if you disagree.

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Hi @whosprof,

Your topic will be moving to the AIP Draft phase in less than 24 hours. Are you content with the feedback received or do you wish to extend community discussion for another 7 days?

If we do not hear from you within 48 hours after your topic closes, your topic will be moved straight to the AIP Draft process.

We look forward to hearing from you.

-@Facilitators

2 Likes
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This topic was automatically closed after 7 days. New replies are no longer allowed.

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Hi ApeCoin DAO Community,

@whosprof has completed editing their AIP Idea to be their AIP Draft.

Follow this Topic as further updates will be posted here in the comments.

Kind Regards,

-@Facilitators

1 Like
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Hi ApeCoin DAO Community,

Our team has reviewed and discussed @whosprof’s AIP Draft and have sent a list of initial questions. We await answers.

Follow this Topic as further updates will be posted here in the comments.

Kind Regards,

-@Facilitators

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Hi ApeCoin DAO Community,

@whosprof has responded to our questions and they are in our review once again.

Follow this Topic as further updates will be posted here in the comments.

Kind Regards,

-@Facilitators

2 Likes
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Hi ApeCoin DAO Community,

@whosprof has responded to our questions and has provided consent to share them in this forum for the community.

1. The ApeCoin DAO has, up to this point, never taken direct custody of any non-ApeCoin assets or added NFTs to its balance sheet. When you mention the “[Creation of] an ApeCoin DAO controlled wallet” to purchase and hold the NFTs, who would create, control, and operate this (multi-sig?) wallet?

Ideally, the creation, control, and operation of the wallet would be exactly the same as our Treasury when approved AIPs request funds. I’m not positive how our treasury is setup and who manages the wallet, but I imagine we would use the same individuals and processes to manage this new wallet. If it’s possible to simply use the same treasury wallet for managing the Ape NFTs that would be even easier, but I imagine there may be a reason why we would want to segregate the assets. Looking for feedback here on what would be easiest.

2. How would the multi-sig signers be chosen?

I would recommend we simply use the same people and processes we use for managing the DAO treasury unless there’s a reason we can’t. I am not looking to involve a new third party for managing this wallet.

3. Is there a legal entity representing the multi-sig that would be ready and capable of obtaining legal title to the grant amount?

Again, could we use the same entity as the one that manages Treasury?

4. Given the large size of the requested grant, would you be open to receiving the grant in increments over a period of, for example, 500k APE tranches over 12 months?

I think the DAO would be able to buy the most NFTs for its dollar if done all at once. So I would prefer if the funds are allocated to the wallet purchasing the NFTs all at once. Ideally, the DAO would now hold NFTs valued at more than $9 Million available for grants after the sweep. The beauty is granting these Ape NFTs in the future instead of Apecoin would no longer require the DAO to sell or lose Apecoin to fulfil an NFT grant.

5. Would you be open to only receiving a subsequent tranche once the majority of a prior tranche has been spent?

Again, when it comes to purchasing the NFTs in bulk, I believe it would be in the DAOs best interest to purchase them all at once through a sweep. Not doing so risks sellers delisting and relisting at higher prices, making it more expensive to acquire the NFTs over time.

6. Do you provide consent to share these questions and answers with the community in this forum?

I consent to sharing the questions and answers.

A DAR package is being worked on and upon completion this AIP will move into Administrative Review. Follow this Topic as further updates will be posted here in the comments.

Kind Regards,

-@Facilitators

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Hi ApeCoin DAO Community,

We have no further questions for @whosprof. This AIP is now under Administrative Review.

Follow this Topic as further updates will be posted here in the comments.

Kind Regards,

-@Facilitators

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Hey @Chris.Admin,

What’s your answer to that:
3. Is there a legal entity representing the multi-sig that would be ready and capable of obtaining legal title to the grant amount?

Again, could we use the same entity as the one that manages Treasury?

-Mr. Hype :fire:

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Hi @MisterHype,

Your proposal is under Administrative Review, so if there are any issues with your response from the Foundation, we will be sure to let you know.

-Chris

1 Like