Nfts
What is $NAMES? The Name Token Idea Explained
My favorite NFT project? Names.
It’s a decentralized collective, a grassroots brand, a software movement, and an open public art series all rolled into one. They are also a big supporter of public goods and privacy efforts in crypto. Long story short, this is a tribe I love and have long planned to join.
However, to join today, the going rate for a name is currently around 5-6 ETH, and that’s a nice amount of gwei to pay in one go.
That’s why I’m excited about the possibility of $NOUNS, an ERC-20 token envisioned by the Nouns community that you could stack over time until you’re ready to trade it for a full NFT and your place in the DAO.
It’s up in the air right now, but let’s break down what we know so far about the $NOUNS interim token.
via names.wtf
What is the $NOUNS token?
First introduced in March 2024 by the Verbs development team within Nouns DAO, $NOUNS is a proposed fungible token designed to make ownership of Nouns more accessible and to grow the Nouns brand.
The token would be created and backed by NFT Nouns, allowing more people to gain direct stakes in the Nouns ecosystem without first purchasing a full NFT Noun.
The big idea? Fostering wider participation around Nouns, which in turn would lead to more supporters of Nounish and Nounish projects, and thus the DAO flywheel going round in circles.
How would $NOUNS work?
If approved by the collective, $NAMES would be adapted to the particularities of the names. The Verbs team planned the main pillars as follows:
- 🪙 Strike and Redemption: Any Noun can deposit their Noun NFT into the fungible token contract and receive one million $NOUNS tokens. Conversely, anyone holding 1 million $NOUNS can exchange them for a Noun NFT by sending the tokens and Noun ID to the contract.
- 🔁 ERC-20 compatibility: The $NOUNS token will have standard ERC-20 functionality, including transfers and balance readings. The token ticker is NOUNS and it has 18 decimal places.
- ✅ DAO governance: The token contract, initially assigned to the Verbs multi-sig account, can be upgraded by Nouns to allow future improvements and additions of functionality.
- 🍴 Integration of the fork mechanism: The $NOUNS token will be integrated into the DAO novel Fork mechanismensuring that $NOUNS in the treasury are treated the same as NFT names in any future fork.
- 🌉 Bridging and deployment: Initially deployed on the Ethereum mainnet, $NOUNS can be connected to L2 networks such as Optimism, Base and Zora for wider accessibility.
What are the use cases for $NOUNS?
Above all, the names themselves can use $NOUNS to encourage engagement around its ecosystem. Consider $NOUNS distributions to reward onchain proposal creators, participants rounds.wtf, protocol interface developers, Farcaster Client Buildersetc.
For people who are big fans of Nouns like me, there is also a savings utility, as you can regularly accumulate $NOUNS tokens to save for a full Noun NFT exchange. In other words, gradually join the collective on your own schedule without having to pay the full price up front.
Finally, there is a speculative aspect. Investors who want exposure to name value without owning an NFT could purchase and trade $NOUNS, provide liquidity, and earn fees on decentralized exchanges like Uniswap, etc.
Will $NOUNS be launched soon?
Currently, the $NOUNS token is in governance limbo, as a recent audit proposal the planned implementation was rejected in Nouns DAO.
Reasons cited by “against” voters included doubts about pursuing a token that may ultimately not be necessary, the hostile crypto regulatory environment, a desire for more study and community discussions on token specifications, and more.
However, this does not mean that $NOUNS is at a dead end. Further research and more regulatory tailwinds could put it on track for a launch sometime next year if governance heats up around it.
Ultimately, there is clearly considerable interest around a fungible token within the collective. Nouns DAO recently approved funding for 14 ETH for the development of $⌐◧-◧an alternative ERC-20 fractional token concept that would offer direct voting power and associated fractional NFTs.
“I’m FOR competing versions of what fungible names could look like,” noted the Nounder Seneca. “At a reasonable cost, it makes sense to support [another] well-intentioned effort to explore the form factor.
That said, over time, $NOUNS and $⌐◧-◧, along with other Nounish tokens, could co-exist side by side in the Nouns ecosystem. The skeptics within the DAO are the main obstacle here at the moment – and that’s a good thing, there’s no need to rush the work like this – but, of course, the skeptics won’t. will not necessarily prove to be an eternal obstacle.
Concerns may eventually be allayed, but only time will tell how the course and pace of such a thaw will unfold. In the meantime, be sure to keep an eye out governance and resources like Letter of names to follow all the updates around a Nouns token. Personally, I follow the developments and debates here with great interest!