Social
Note: Data in this section last updated May 28th, 2022
What are Social NFTs?
Social NFTs grant owners access to exclusive communities, experiences or goods.
While we are still in the earliest stages of development, several potential use-cases for social NFTs are emerging. Some of the more popular proposals include:
Social Clubs (e.g. Country clubs, private members clubs, community organizations)
Charities (e.g. Education, health, environmental)
Investment Clubs (e.g. VC / PE / Hedge Funds, NFT collectors groups)
Artist’s Guilds (Film studios, publishers, news organizations, records labels, game developers)
Worker Collectives (e.g. digital unions, talent agencies, consulting firms)
Although the use-cases of social NFTs are broad, most tend to share three important criteria. They are: 1) organized around a single purpose, 2) share a treasury raised from early NFT sales and 3) often structured as DAOs.
The total market capitalization of Social NFTs is ~$200M (or ~1% of the NFT market) but they are poised to grow as a replacement for both in-person social organizations and online, “Web2”, social networks.
What are the Benefits of Social NFTs?
Social clubs are obviously not a new phenomenon. For most of history, we’ve been joining guilds, salons, country clubs, exclusive houses, etc… to gain a host of benefits such as networking, knowledge sharing, status, etc…
Social NFTs are unique in that they allow members to form organizations that retain the advantages of traditional clubs while adding several new features. Because these organizations are often structured as DAOs (LINK TO DAO ARTICLE), they enable:
Democratic decision-making: Unlike many legacy organizations, Social DAOs have a flat structure with little to no management hierarchy. Each NFT holder has a vote, allowing the organization to leverage the collective wisdom of the group
Direct economic incentives: Social DAOs have the ability to create their own native currency. As such, they can directly compensate members who help with sales & marketing, recruiting, operations, financial management, development, community management, etc…
Liquidity: Many traditional clubs restrict the transfer or sale of membership. Even when permitted, it’s generally difficult to find willing buyers or agree upon a fair price. Social NFTs, on the other hand, are extremely liquid – they are generally traded on a variety of platforms such as OpenSea and Looksrare, and prices are updated in real-time.
Transparency: Every vote made and every dollar spent by a social DAO is permanently recorded on an immutable blockchain, making it easy to budget, track spending, detect fraud, audit member contributions and measure performance.
Efficiency: Although distributed organizations have their challenges, the ability for real-time communication and the automation of processes make DAOs extremely fast. In addition, the elimination of traditional management structures can greatly reduce overhead.
How do Social NFTs work?
To understand how Social NFTs work, let’s look at one of the hot new projects in the space – LinksDAO.
LinksDAO is a decentralized autonomous organization that plans to create a modern version of the country club by selling NFTs to crowdfund the purchase of a Top 100 golf course.
The DAO was founded in 2021 by Mike Dudas (founder, 6th Man Ventures), Jim Daily (president, Teads) and Chris Maddern (co-founder, Button). It raised over $10M in 48 hours through the initial sale of 6,363 “leisure membership” and 2,727 “global membership” NFTs that offer holders rights to purchase membership to the club, governance rights in the DAO and access to golf outings, discounts on tee times, exclusive merchandise, etc….
LinksDAO NFTs
Purchasing and running a golf course is no small feat, so the company has outlined a detailed roadmap:
Early 2022: Proceeds from the initial offering will be used to build the DAO and organize the community. This includes hiring a Chief DAO officer, location scouts, product & engineering support, marketing personnel and legal, compliance and accounting teams
Mid 2022: The community will identify potential clubs, vote on which one they’d like to acquire and use funds from the treasury to acquire a golf course
Late 2022 – Early 2023: The first LinksDAO club location will open
2023 & Beyond: The community will continue to expand to additional locations, creating a global “country club”
LinksDAO boasts a passionate community – it has over 15K Discord members and has hosted real world events such as a members-only tournament at SXSW. What makes the project especially interesting is that it’s expanding the crypto ecosystem by introducing NFTs to the general public (i.e. “normies”). It has a very clear and understandable value proposition – membership to a golf club – and, as such, roughly one-third of the participants in the initial sale were first time NFT buyers.
On May 25th, 2022, LinksDAO announced a partnership with Callaway.
Who are the Key Players in the Social NFT ecosystem?
In addition to LinksDAO, other social NFTs include Metahero Universe Planet Tokens, Hyperbearsclub, HeadDAO, Crypto Packaged Goods, City DAO Citizenship and IreneDAO.
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