The tokenomics behind MurAll
To find out more about MurAll see our first article: What is MurAll?
Some time ago we heard a story about some divers who went down to the wreckage of the Titanic and returned with 6 bottles of wine; those 6 bottles were valued at $1 million each, so do you know what those divers did? They drank one bottle. Then another.
This was shocking to hear: how could they waste something so expensive?! But things became clear after the storyteller explained their reasoning: by drinking those 2 bottles, that meant there were no longer 6 bottles in existence, there were only 4. This meant the remaining bottles were even rarer than before, and their valuation was a lot higher than just $1 million per bottle; the process of removing 2 bottles from “circulation” increased the value of the remaining “circulating” bottles. This is the core mechanism behind the PAINT token that MurAll requires.
Tokenomic #1: PAINT
PAINT is synonymous with real life paint, in that once it’s used it can’t be used again. In the process of “painting” on MurAll, the PAINT spent in the transaction is “burned”, taking that PAINT out of circulation, and reducing the global supply of PAINT. Reducing the supply increases the rarity of the remaining supply, and thus the cost of the remaining supply. We use this mechanism as a way of ensuring that high quality art is drawn to MurAll, as people will think twice about wasting PAINT on drawing something not meaningful as it becomes rarer and in turn more valuable, and will instead sell PAINT to those who will not care about the price of PAINT and instead want to make art on MurAll regardless of the cost.
Possible drawbacks of the PAINT tokenomics
One possible scenario that could play out at the beginning is that due to there being a large supply of PAINT at the beginning artists would not be as incentivised to produce high quality art as PAINT will be cheap and plentiful, resulting in an initial phase of low quality art. In addition, a possible consequence of the deflationary aspect of PAINT is that some people may want to draw solely in order to reduce the global supply of PAINT (i.e. to increase its rarity and therefore its value), thus those people may not produce high quality artwork on MurAll as their intentions are not driven by the desire to paint but are instead driven by greed. This is why we have yet another incentive structure: the process of painting on MurAll mints an NFT of the artwork you produce on MurAll.
Tokenomic #2: MURALL NFTs
As an NFT of your artwork is minted in the process of painting on MurAll it is in the artist’s interest to paint something high quality/meaningful because they can sell the NFT later. Low quality artwork, or artwork without meaning will be a lot harder to sell, if they can sell it at all.
In addition, due to the fixed supply of PAINT and its deflationary nature, this means the amount of NFT’s possible to produce from MurAll is also limited, as NFT’s can only be produced while there is PAINT to use on MurAll; once the global PAINT supply runs out, no more MURALL NFTs can be minted, thus they have this additional rarity attribute to them.
Dual tokenomics working in harmony
We believe these 2 tokenomics working together in tandem will ensure high quality content is painted on MurAll, as artists are incentivised and rewarded for producing high quality art, thus circumventing the need for centralised control/censorship of the artwork produced on MurAll.
MurAll has been our labour of love which we’ve done in our spare time between day jobs, without investment or help, the main reason being that we wanted to keep full control over our vision and not have it corrupted by anyone that we owe equity to: this means we don’t owe any angel investors any equity, and there will be no private sale of PAINT, we have always had the intention of giving away the PAINT to the users who believe in what we’re trying to do. As we stated in our litepaper the total supply of PAINT will be 22,020,096,000 (which is calculated from the 0.5 PAINT fixed cost per pixel to draw on MurAll, with a possible 21,000 entire coverings of the 2048 x 1024 pixel canvas) and the PAINT will be distributed as follows:
- 42.02% going to known artists (we have a list of 8824 addresses collated from Known Origin/Rarible/SuperRare/Async Art, snapshotted 15/11/2020; each address will be able to claim 1,048,576 PAINT — enough for 1 entire coverage of MurAll) totalling 9,252,634,624 PAINT
- 40% to existing NFT holders (we collated a list of 45511 addresses of ERC721 NFT hodlers with both incoming and outgoing ERC721 transactions and thus demonstrate competency with ERC721, snapshotted 18/12/2020; each address will be able to claim 193,537 PAINT) totalling 8,808,062,407 PAINT
- 3% to us 3 founders (1% each, which is 220,200,960.00 PAINT) totalling 660,602,880 PAINT
- 14.98% left over for us to use for running costs/competitions/events/commissions/social stuff, and also to give the few people that have helped us with testing etc a little something as a thank you (we were thinking enough for maybe 2/3 coverages of MurAll) totalling 3,298,820,096 PAINT
Please note that some addresses counted as both artists and NFT holders and thus they were deemed eligible for both claims.
To ensure that MurAll hit the ground running, we targeted wallets of users we believed to be crypto artists or active in the NFT community. Therefore we searched for addresses of verified artists and wallets with both incoming and outgoing ERC-721 token transactions. We believe that this will ensure we cater to an active art community and people who are familiar with ERC-721 tokens and thus will appreciate our project more.
Following these requirements gave us 51,754 addresses that are eligible for the airdrop and ensured that the claimable amount is meaningful and claimants could actually use it to draw on the MurAll canvas, which is what we are trying to achieve.
We believe this is a fair distribution to users who will make the best use of PAINT. Claims can be made on the MurAll website up until 22nd January 2022 (365 days after the inception of the claim contract).
In our next post we will deep dive into the approaches we took and the decisions we made with our smart contracts in order to fit as much data as possible on chain while keeping costs as low as possible.
Read our Litepaper: https://gateway.pinata.cloud/ipfs/QmWr8YDKXGzytBLQiNS4XQnzAziVspemnUHw2ZdqcKdQys
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