A Getting Started Guide to Collector DAOs

Collector DAO is a type of DAO that collects, sells, and issues NFTs. As NFTs have grown in popularity and adoption, they have become a large part of the crypto investment landscape. The main goal for Collector DAOs is, as the name suggests, to acquire NFTs from chosen collections or artists.

This article will be split into two main parts. The first part will be dedicated to existing collectors to understand their mission and value. In the second part, the process of creating your own collector DAO will be described.

The connection between NFTs and DAOs is a connection between two of the most popular phenomena in crypto. A DAO is a form of social organization in the digital space that helps to distribute crypto assets and NFTs are digital assets that have a large demand in the crypto community. Moreover, NFTs embody values and transfer them from real life to the digital space.

Many conservative economists think that NFTs have no value, but that’s very short-sighted. NFTs mirror the demand to have something in digital space that reflects the values that are important to people and are a very handy tool for the creative economy that allows creators to easily monetize their work or famous memes, as well as make money from trading them. Any painting, audio recording, video or other digital art can be easily tokenized in the form of an NFT. And a DAO allows you to share ownership of that NFT among a wide audience of its members.

There are several Collector DAOs founded in recent months that were highlighted in Coopahtroopa’s report. Some of these DAOs, like BAYC and Bright Moments, were also included in Coopahtroopa’s list of Social DAOs. This happens because of the mass adoption of NFTs, encouraging some Collector DAOs to become Social DAOs since they have a large community and measurable social impact. Let’s take a look at four Collector DAO cases:

Bored Ape Yacht Club is one of the most popular projects in the field of NFTs. Over the last few months, the brand made headlines in top crypto media and has as a basis a collection of 10,000 apes in the form of NFTs. In September of 2021, 101 NFTs created by BAYC were sold in a Sotheby’s auction for $24.4 million. The project was launched in April of 2021 and the initial price of 1 ape was extremely low — only 0.08 ETH. BAYC’s success gave inevitable impetus to copycat collections of animal-based NFTs. Although BAYC is not simply an NFT collection, it’s a DAO that has a channel in Discord where BAYC’s community operates. DAO members and BAYC holders get additional rewards in the form of NFTs, some of which have already been distributed. The MAYC collection contains 20,000 NFTs of mutant apes and also a collection of 10,000 dogs. BAYC DAO membership is available for both mutant and BAYC holders (but not holders of the dogs collection), totaling 30,000 possible members. The main channels of monetization of this membership are still selling NFTs on marketplaces and the ability to get drops.

Bright Moments DAO also stands out in Coopahtroopa’s report as a Social DAO crossover. According to comments made by its representatives, the Bright Moments should unite artists, developers, and NFT/DAO specialists. This DAO has its own gallery on Venice Beach in Los Angeles. The governance of the DAO belongs to holders of BRT token. Each of the 40 founding members got 25,000 BRT, meaning 1,000,000 BRT belongs to DAO founders. The remaining 9,000,000 BRT will be spent as rewards for NFT creators and other DAO members for their activities. This DAO has celebrities as members, including such household names as Snoop Dogg and Paris Hilton, and the gallery in LA has Seth Goldstein and Louie Ryan as founders. The vision behind this DAO is to create a system of offline galleries that will exhibit NFTs and to give rewards for DAO members and useful social activities connected with digital art.

Another case of a successful Collector DAO is Flamingo DAO. The idea of this project is to give its members the ability to easily act in the field of NFT investments. According to the info on Flamingo’s website, DAO members can fractionalize their NFT holdings: “purchased NFTs can be lent, held, displayed in a digital art gallery, or used as collateral in other DeFi platforms”. The membership in this DAO is available to US-accredited investors and the total number of members is limited to 100. Applicants must buy from 100,000 to 900,000 Flamingo Units; a block of 100,000 Flamingo Units grants 1% voting power. The current total amount of Flamingo purchased is worth 7,920 ETH.

Pleasr DAO began during the DeFi summer and was founded by Uniswap community members to buy an NFT of the Uniswap V3 promotion video. The NFT was created by artist @pplpleasr1. The DAO has about 74 members and works like a combination of an NFT investment fund and a production studio. It is famous as the owner of Wu Tang Clan’s album “Once Upon A Time In Shaolin” and the Doge Meme NFT, and boasts famous and successful members in the field of IT and crypto, such as Alex Svanevik (Nansen), Leighton Cusack (PoolTogether), Andrew Kang (Mechanism Capital), Tarun Chitra (Gauntlet Network), Leo Cheng (Cream Finance) and Calvin Liu (Compound).

The above cases are, of course, not the only Collector DAOs. There are other popular projects in this area, including Squiggle DAO, Fingerprints DAO, Whale, Museo, herstoryDAO, BeetsDAO, JennyDAO, MeebitsDAO and Gremlins.

Nevertheless, by observing these DAOs you can get an idea of what Collector DAOs do and how they work. According to the number of participants, they can be divided into two types by size: some are small organizations that have dozens of participants, while others, like BAYC and Bright Moments DAO, have thousands of participants.

The success of each of the Collector DAOs is very much tied to a community and media exposure, the latter being more extensive with a larger community. It is a large community, appeal to famous brands, and the participation of celebrities ensured the success of the above projects. In one way or another, the work of these organizations combines elements of investment funds, which distribute the profits received among their members, and production studios.

In terms of the business solutions that XDAO presents to its users, we recommend considering the creation of a Collector DAO, especially if your business is in the creative economy and you already have media coverage, a strong community, or both. Existing regulation in this area already allows for legal distribution of revenue from creators’ activities through DAOs.

Create a Collector DAO

XDAO allows you to create a DAO with unlimited participants and investors. Once you are ready with the collector idea, for example, collecting all the cute doodle NFTs, you can go to https://xdao.app/, choose the blockchain where your DAO will buy NFTs (XDAO currently supports Ethereum, Polygon, BSC and 7 other blockchains) and create a DAO.

To raise funds for your Collector DAO, create an LP token that people will buy in order to have a share. All money from the purchase of LP tokens will be accumulated in the DAO and used later to get desirable NFT.

Once your DAO has enough money to buy NFTs, go to Opensea, Rarible, Looks Rare, Super Rare, Fandefi, or any other NFT platform, connect to your DAO via XDAO Connect and buy your NFTs!

After your proposal is successfully passed and your NFT is obtained, all LP holders will have a right to this NFT equal to their share in the DAO.

If you want to sell this NFT, you will need to take absolutely the same actions as for purchasing it. And when the NFT is sold, a DAO as well as all the LP holders would also have a profit from it!

First published here