It soared 365 times in 9 days. What does CultDAO attract its "believers" with?
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Scene from the movie "V for Vendetta"
The bell rang, the detonating handle fell, and the train loaded with explosives roared towards the Parliament Building carrying V's body, and then the Parliament Building turned into gorgeous fireworks accompanied by Tchaikovsky's "1812 Overture". Under the mask, as if reborn.
This is a classic clip from the movie "V for Vendetta", and it is also the accompanying video in the first tweet posted by CultDAO's official Twitter on January 20.
Then CultDAO went step by step, raising funds on unicrypt, and looking for an audit from SolidProof. Although the token was unknown for nearly 2 months after its launch, it finally ushered in an explosion at the end of March, with a 365-fold increase in 9 days. The huge wealth effect, mysterious project owner, KOL as "guardian", ideological blessing and other factors are mixed together, making it quickly become a hot topic in major communities.
「Made by the different. For the different.」
CultDAO has brought a new narrative, making the tweet look more and more like a call to the old world.
What is CultDAO? Is it "The DAO" 2.0?
From the perspective of business logic, CultDAO is a decentralized venture capital fund: the community votes on proposals, and community members participate in the investment as investors in a decentralized crowdfunding manner, and then return the return on investment to CultDAO tokens in the form of dividends pledgers.
But CultDAO is not just an ordinary VC DAO.
More than ten years ago, the subprime mortgage crisis and the European debt crisis swept the world. More and more governments chose to respond to the crisis with monetary expansion, which led to inflation and competitive currency depreciation becoming a normal state. This is what Bitcoin and devaluation The historical opportunity for the rise of centralized finance. Later, people used DAO to put the idea of decentralized Crypto into practice: PeopleDAO bid for a copy of the U.S. Constitution, and AssangeDAO ran to save Assange, and OlympusDAO created a myth of wealth through the (3,3) model. . But the new era requires a new narrative, and "The DAO" 1.0, which only takes one thing as its program, needs to be upgraded urgently.
The war has caused the ideological trend of cryptocurrency to sprout. CultDAO has brought the decentralized ideology to the fore with its provocative manifesto, decentralized proposals and voting models, private key destruction, and contracts that can never be changed. Ultimate, the first shot of "The DAO" 2.0 was fired.
How does CultDAO work?
To put it simply, making profit through investment is the main business of CultDAO. All part of the handling fees for CULT token transactions will be filled into the treasury as the investment fund of CultDAO. The funds in the treasury will automatically invest in the proposals voted by the community, and part of the investment income will be returned to the pledgers of CULT tokens . The strong deflation brought about by mass destruction and the ve model are also important means to support its currency price, and they combine to ensure the current normal operation of CultDAO.
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CultDAO's economic model
The following are the main functions of each subsystem:
Tax system:Every transaction (including staking/unstaking) that interacts with CULT tokens will generate a 0.4% tax, which will be collected to the treasury. In fact, the treasury of CultDAO is an investment fund pool. Unlike other venture capital DAOs, the source of funds in the fund pool is not the direct investment of investors, but the generation of CULT tokens traded in the secondary market. handling fee. As long as people continue to trade in the market, taxes and fees will continue to be filled into the treasury.
Pledge system:Using the ve model, the supply and demand can be affected by staking and locking the liquidity token CULT. Token holders are incentivized to lock CULT tokens for a long time, and then convert them into dCULT tokens with protocol governance capabilities. dCULT tokens serve as proof of pledged equity, and its holders can obtain pledge rewards and return on investment. When these CULT tokens are locked, they are taken out of the market for a long period of time, reducing selling pressure.
Proposal System:The top 50 dCULT token holdings are called Guardians. They can make proposals for investment projects. The proposal must specify the overall token supply of the project and the amount of tokens that will be returned to CULT DAO in the future (ie dividends), project white paper, audit results, destruction and distribution plan, and attach the project's official social channel and contract address. People whose holdings are lower than the top 50 are called voters (The Many), and they can vote on proposals. If the proposal is passed, the funds will be automatically sent to the address of the invested project if the amount of treasury funds is sufficient. At the same time, guardians only have the right to propose, and voters only have the right to vote.
Investment system:When the amount of funds in the treasury reaches 15.5ETH, it will automatically invest in the proposals that have passed the vote. Each time, 13ETH will be sent directly to the wallet of the invested project. Under the pre-negotiated rules, the tokens of the invested project will be unlocked regularly, and the tokens obtained from this part of the investment will be sold and exchanged for CULT Tokens, 50% of the proceeds will be used as dividend rewards for dCULT stakers.
Destruction system:Every time the treasury invests in a proposal, it will automatically destroy CULT tokens worth 2.5ETH. 50% of the proceeds from selling the tokens of the invested project will also be directly sent to the black hole wallet for destruction.
What does CultDAO attract its "believer"?
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CultDAO Homepage
"The purpose of CULT is to empower and fund those who build and contribute to our decentralized future." OpenCultDAO's homepage, This sentence is impressive. At the same time, the background music is the 7-minute speech Fight For Liberty (fighting for freedom) in the movie "The Great Dictator"fragment, this part of the speech is also recognized as the most exciting speech in Chaplin's life. When the movie was released in 1940, when Nazism was rampant, Chaplin was still fearless against power. This spirit guided CultDAO to maximize the idea of decentralization:
1. Proposals and investments are made in the form of DAO. Guardians and voters perform their duties to ensure that the rights are in the hands of the majority.
2. The project to be invested is required to oppose centralization, promote the cause of decentralization, and directly benefit a noble cause.
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Screenshots from the CultDAO community
The highly provocative "CultDAO Manifesto" promotes the idea of decentralization. When someone in the community asks who is in charge, someone will answer "No one and everyone". Even the founders cannot interfere with the operation of the community. The leader of the community is everyone. 100% decentralization is a new narrative brought by CultDAO.
The mysterious founder and the involvement of KOL
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SolidProof Team Shocked by Foundership
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"Clues" that are difficult to distinguish between true and false
In addition, according to CultDAO, Mr O'Modulus has invited the founders of some well-known Web3 projects to serve as guardians. Currently, the following are publicly available:@TrustlessState(Founder of Bankless),@dominicVEMP(CEO of vEmpire DDAO),@auryn_macmillan(GnosisDAO)、@hackapreneur(Justin Wu)、@only_rares(CPO of Ethereum Towers),@deepcryptodive、@META_DREAMER、@abv_avg_joeimage description
Guardian Invitation List
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CultDAO's Positive Flywheel
Ideally, guardians and voters in CultDAO work together to bring high returns on reasonable investments. High returns will attract more funds to enter the market to buy CULT tokens and pledge them as dCULT to obtain pledge rewards and investment rewards. This process will increase the currency price of CULT tokens while reducing circulation. When CULT tokens are traded, there will be more fees to enrich the treasury, which in turn will bring more investment. Investment will destroy a large number of CULT tokens, which will further bring strong deflation. Token deflation will directly benefit token holders and can promote transactions in the secondary market.
Whether CultDAO's investment can achieve high returns is the key to start the positive flywheel.
What are the problems with CultDAO?
Unbeatable
Ideally, guardians and voters will exercise their proposal and voting rights in a responsible manner to the community and abide by the principles of decentralization. The reality is that everyone is a stakeholder, and the investment income of CultDAO is closely related to everyone's decision. In other words, everyone's investment decision may be biased in order to better suit their own interests, which will lead to the final investment decision running counter to the original vision of decentralization.
Investing is a professional thing, and high-return investment decisions are often anti-market consensus at the beginning. CultDAO’s proposal voting mechanism uses a decentralized method to delegate power to more people. On the surface, the entire community brainstorms and makes decisions on investment plans. In fact, the lack of a “dictator” who makes the final decision may lead to Investment results have become extremely mediocre.
Potential bribery and monopoly risks
Whales can influence investment decisions by bribing guardians/voters, or launch a "sybil attack" to pledge CULT tokens in multiple wallets to vote, making CultDAO's investment decisions more in line with their own interests. Theoretically, as long as the whales are large enough, they can control proposals and votes by themselves or in collusion with multiple people, and then monopolize all investment decisions. In addition, voters need to pay gas fees to participate in voting, which further discourages the enthusiasm of ordinary retail investors to participate in voting as voters.
Limited scope of investment
Excellent projects/entrepreneurs can usually find excellent venture capital. CultDAO has a very controversial ideology, which may discourage many excellent projects. At the same time, all projects invested by CultDAO require currency issuance, and each investment of 13 ETH is far from enough for many projects. If CultDAO can only invest in some small and micro entrepreneurial projects without a high return on investment to turn the positive flywheel, it will only be able to sell its only ideology in the end, becoming a meme coin and gradually disappearing.
Inefficient voting process for proposals
The cause of the dispute between CultDAO and PandaDAO is that PandaDAO, with the help of a guardian, initiated a proposal to participate in PandaDAO's fundraising within CultDAO, and the voting period lasted for 7 days. Unexpectedly, after the proposal was launched, the popularity of CultDAO itself was diverted to PandaDAO, causing the fundraising of PandaDAO to hit the soft top in a short period of time, and the fundraising will be automatically closed the next day. live” and cannot participate in fundraising. Then this incident continued to ferment, triggering FUD in the two communities, and finally broke up unhappy.
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Is CultDAO the next cryptocurrency revolution?
CultDAO, which was born just over two months ago, has made a strong mark in the cryptocurrency world with its advanced ideas. Fans call themselves "believers," while dissidents call them "evil religions." If it is used as a social experiment, CultDAO undoubtedly provides a good sample. The merits and demerits are still inconclusive, and time will slowly test it.
Tchaikovsky's "1812 Overture" was played again, and people took off their masks. This time, are you a guardian or a voter?
