We do a market place with bids done entirely in unbacked/distressed assets. When bidding, any bidder that wins burns 100% of their bid, whereas every bidder that places a bid immediately burns 10% of their bid.
This is to lower total exposure/cost to reback assets eventually.
If a floor ape was sold in this way, and there were only 200 bids ending in a fair value sale, this could burn almost 1 million 1USDC.
There are also commitments from many validators, influencers, and projects to support the intitiative, providing NFTs of value, including custom 1/1s made uniquely for inclusion on such a marketplace.
Also, the Byte Masons have committed to deploying this project in extremely quick fashion, asking nothing more from Harmony than some promotion of the good faith efforts. The Byte Masons will charge no fees, and will burn all distressed assets in an automated manner.
As someone who lost six figures in the bridge hack, the idea of burning 10% of my funds to bet on a chance to pay full price for an ape picture I never wanted in the first place… Hell no.
If you really think your commitments can gather art worth $100m to reimburse folks that lost money, then please go ahead, sell it on Ethereum and repeg the bridge.
If its on Ethereum, it doesn’t get the same multiplier effect. The whole point is to lower the amount of assets needed to be fully rebacked on the ETH side.
So if you follow the math shown, an NFT worth 100k usd (a blue ape) would allow for the burning of almost 1 Million 1USDC, because of the multiplier effect.
If the 100m were equally distributed amongst wallets in a way that they could afford a BAYC, we’d have less than 1000 that could pay fair value. But wealth distribution is never fair, so we’re left at best with a couple of dozen. And out of these, not all might be interested.
Good luck racking up 200 fair bids on several high value NFTs with only a handful of potential buyers. There’s a good chance some people might get lucky at a discount, while others burn some cash and the overwhelming majority can’t even afford to participate.
Most likely you’d end up burning less than the apes would be worth, pissing off auction losers & the masses who are outpriced.
Honestly, if Harmony commits valuable assets to this instead of a real reimbursement… I’d be beyond pissed.
But it doesn’t function in any way like what you described…
It’s not reimbursing people. It is strictly structured around burning of distressed assets. People would essentially be aiming to pick NFTs of value up on discounts.
It’s a gamble for individual people. It has nothing to do with splitting assets between wallets. Are you in the Twitter space being ran by Tim, by any chance? I can explain it verbally if that works better for you.
My point is there are maybe 50 people who have enough 1USDC assets to pay fair value for a BAYC. Out of these only a few would be interested in an ape.
If one dude bids $100k (which is below fair value) it immediately disqualifies all but the top holders. Maybe there’s 2 or 3 more who would be interested to outbid that. You’ll never rack up enough bids to burn anything substantial.
You’d be selling 9 apes for a discount between a few whales.
This has to be part of the plan. Let’s get rid of these unpegged coins. This is creative and it can bring new people into the chain by putting up the Bored Apes!
I like the basic auction idea. The way I see it you have everything you need to put it into place. You have artists that are committing art and a dev team that can do it. Seem like you can start anytime.
But your example calculation with the bored apes is entirely unrealistic. Not because of the math, but because only a tiny group of people can afford it. All you’re gonna do is donate an ape at a massive discount to a lucky bidder. There is only a handful that can participate in the upper echelons.
Auction house with donated affordable assets → sounds great, go ahead
Auction house with 9x $170k NFTs and a target group that can fit in a minivan → donation to whoever gets lucky
Putting the apes to work sounds great, sell them on ETH and fund reimbursement
This idea is very good. It will create a giant first step in harmony releasing some financial burden. Possibly making the cost to bring back the 100 mil dollars much much much lower. Way lower.
It will demonstrate the Harmony leaderships’ ability to make better decisions. And also the ability to be humble and sacrifice assets they have to help the community and chain.
This will build momentum for others to come in and also contribute to the rejuvenation of harmony.
It will demonstrate to the leadership at harmony that listening to your community can pay off big time. Especially those who are very immersed and connected in the space and can greatly help the chain. And could have been utilized much more. Aka FLU.
Please utilize this very well put together plan to kick start harmony back to life.
Would that prevent people from trying to outbid each other and extending the auction? Extended auction = more assets burned, right?
A single BAYC could burn close to 1 million 1USDC? It’s not a solve-all solution, like you state, but even half that amount would be a welcomed help.
Would there be diminishing returns on each additional BAYC if they were also put up for auction? A bidder “fatigue”, in essence. This is where marketing assistance from Harmony would be mandatory to increase the pool of bidders. I presume targeting the BAYC/Yuga ecosystem, as well as some large crypto/NFT media outlets and “influencers”? How else would you propose this be marketed?
Also, what are your thoughts on doing a lottery as well? It would operate like any other lottery. Tickets could be purchased in 1USDC. All 1USDC used to purchase tickets would be burned. Where an auction may only be attainable for larger wallets, perhaps a lottery would attract smaller wallets; more wallets.
I don’t have any analysis to support the idea of a lottery (everything in your document after “Introduction” was over my head).
I agree with initiatives like this. It’s low investment (at Flu’s expense, thanks mate) and by doing this, you enable those affected by the hack to make a choice with their own assets.
Do they believe in the repeg and 1USDC will get back to $1? If not, then use your depegged assets and bid for something worth something.
We definitely should consider this as one (of many) initiatives to recover Harmony. There’s no one fix to solve them all, but each initiative helps chip away at the $100 million mountain.
I cant understand why someone would be opposed to this. This may not be the sole repeg solution, but its reducing the burden for the remaining repeg solutions. The apes are beyond useless for the chain at this point - its like having a sports car and being homeless at the same time. Even if you dont get 200 bids, who cares- your likely to get close to floor value from the apes regardless and the % from the bids is just a bonus.
Only issues I see are that depegged token liquidity may be a barrier to participation for outside capital and that we may see front running on the remaining LPs when its decided to go this way.
