One would think that catching the attention of every person involved in a multi-billion dollar industry overnight is impossible â unless youâre two billionaires fighting a group of Web3 bandits on Twitter, or the now famous $SOS token.
In just 72 hours, over the course of the Christmas weekend, those behind the $SOS token were able to wage one of the most successful marketing campaigns in the history of the internet and will be recognized as an important case of Web 3 – whether you believe in Web3 or not.
On December 13th, @9x9x9eth and @The_OpenDAO released a token where every person who has interacted with @opensea, the peer-to-peer marketplace for NFTs, rare digital items, and crypto-collectibles, was eligible to receive an airdrop with a certain amount of these tokens, named $SOS.
Thatâs weird. How did they know if I used @opensea before?
First, let’s provide some background. One of the most appealing aspects (or weirdest/worst, depending on your POV) of blockchain technology is the degree of transparency that it provides. Weâre talking about a fully auditable and valid ledger of transactions. Anyone can join the network and, as a result, view all information on that network. While blockchain tech allows for pseudonyms (see: @gmoneynft, @punk6529), if you know an individualâs wallet address, you can plug it into a block explorer (For example, here is Mark Cubanâs) and see a wide array of information on that wallet.
You can see every transaction itâs ever made, whether sending or receiving. Along with dates and time stamps, it also gives you the ability to send things to their wallet (On that last part, think Venmo – whether you know someone or not, if you have their username, you can send or receive money).
With that knowledge, it’s important to note that while OpenSea is a privately funded company, and most of their dealings happen behind closed doors, each time someone mints, buys, sells, or transfers anything on OpenSea, it gets written into the Blockchain. You can see OS information here. Therefore, @9x9x9eth and @The_OpenDAO were able to see who used OpenSea in the past by looking up all of the wallets that interacted with them before.
Why did they decide to create tokens based on OpenSea versus activity from other transactions across blockchains?
This is one of the most important questions to ask. But first, it’s important to understand the conversations around Centralized vs. Decentralized Organizations and Web 2 vs. Web 3.
This gets a little complicated, but bear with me.
Centralized Organizations are primarily run in a top-down approach (Board, CEO, Executive Team, Employees, Investors). All decisions are made within the organization. If the company grows with users and revenue, those directly involved in the centralized organization reap the benefits.
One of the downsides arising right now is that USERS (anyone with a login) of these platforms believe there should be financial incentives to use these platform.
For example – if you’re an early user of Twitter, there is no way to get “tokens” of Twitter. So, even if you are a power user of Twitter and have brought millions of people to the platform, the only thing you gain is free access to the platform. No money, nada. Depending on what side of the fence youâre on, some argue that is a pretty good deal, and others feel the opposite.
Decentralized Organizations, on the other hand, at least today, is a much flatter organization. DAOs (Decentralized Autonomous Organizations) are internet-native organizations that are collectively owned and managed by their members and do not have a CEO, executive team, or board of directors. The traditional construct of upper management leading everything from financial decisions to priorities and timelines simply does not exist in a decentralized organization.
Sure. Now, what does this have to do with OpenSea?
Let’s tie this all together. As of December 27th, the answer below is speculation.
OpenSea is a centralized company, and even though early users of NFTs have been interacting with the platform with billions of dollars in transaction value, the only people who see the financial upside are those who have invested or have shares of OpenSea (Investors, exec board, etc.). The users of OpenSea can of course use the platform to monetize their own work, such as sales of an NFT, but they do not have any ownership of the platform.
And over the past few weeks, there has been speculation that OpenSea will issue an IPO, which would allow OpenSea investors to make money, versus the users of the platform who feel they have gotten it to where it is now. The mindset is, if users donât use the platform, OpenSea doesnât make money
The speculation caused chaos among OpenSeaâs users, many of whom see an IPO of the platform as a betrayal to its community, instead of becoming more decentralized and offering their own token (ownership) of the company to users of the platform.
Because of this, there is speculation that @9x9x9eth and @The_OpenDAO had an idea to create a new token, $SOS, which would essentially give ownership to users of OpenSea without actually building a partnership with OpenSea (again, this was made possible by the nature of transparency within blockchain technology).
By building a large enough base of people to give the token to, they can now create a vote where the holders of the token vote build a decentralized marketplace to compete with OpenSea, and with this token, it will represent ownership in this new company. With the large numbers of people who are upset that OpenSea is staying decentralized, they could rally the market to support this new token, raise millions of dollars, and in theory, build the new platform they are building.
To break that down even further, if the token were to continue to go up in value, even just by pure speculation, it creates more incentives for developers and various teams to build a competitor to OpenSea, and in return for their efforts, get paid in compensation with $SOS Token. The token can also be used be used for governance of the organization, where tokenholders can vote on the future plans of the org.
Some of those plans could make a condition that when users buy something on the platform, instead of paying the 2.5% in fees that are currently paid to Open Sea, they would pay a certain amount in fees in the form of $SOS. This value would then go back to the market to be distributed among everyone from Discord moderators to engineers and holders of the token. This could be a core reason for people to ditch OpenSea and use a marketplace where they are not financially incentivized to do so. From there, it can get even crazier. We could then see larger institutional money invest into $SOS to really grow the market cap and get exposure to this new organization.
Slow down – have they even built this new platform yet?
Maybe, but nothing has been made public. In fact, it looks like 9x9x9 is committed to making this a DAO in its truest form, and itâs possible that they are waiting for a community vote before moving forward with building anything.
On December 25 at 6:15PM, @9x9x9 wrote in the Discord, âWhy no road map? Answer: Because it is a DAO, we are undergoing set up for the DAO(getting candidates for muti-sig). It is not a company with a roadmap. Decisions are decided by all $SOS holders. (Example: I support staking over 3 years, but community votes for 1 year, which becomes the rule for staking. One day the community can vote for my expulsion as a core contributor if Iâm deemed unfit for the roll. Again, no one owns OpenDAO, other than all $SOS holders)â
Essentially, what 9x9x9 is saying is that even if they had plans to build the next OpenSea, by nature of this being a DAO, the holders of the token (i.e. everyone who ever used OpenSea before and did not sell their $SOS airdropped token) would have to first vote on it. So, for 9x9x9 to say where the $SOS token will take us, wouldnât actually mean anything.
So, they know if I used OpenSea before. How did they decide on the amount of $SOS tokens to give me?
This is actually one of the easiest questions to answer.
The following is from The Open Dao Discord channel: “The distribution is based on the total number of transactions (30% weight) and transaction volume on ETH, DAI & USDC (70% weight) on OpenSea.”
Once you connect your wallet to theopendao.com, you will be able to see the exact breakout of how many tokens you have been allocated.
How many tokens are out there?
There will be 100 trillion total $SOS tokens, and the distribution is as follows:
- 50% airdrop to OpenSea users
- 20% Staking Incentive
- 20% OpenDAO
- 10% LP incentives
- Go to http://theopendao.com
- Connect your MetaMask wallet (As of Dec 27, The Open DAO also supports Coinbase Wallet and WalletConnect)
- Claim your tokens
- Click “Add $SOS”
According to the DAO website, users have until June 30, 2022, to claim their tokens, after which any remaining tokens will be sent to the DAO treasury.
Before I do anything else, I am scared of having my MetaMask tied to the website. How can I ensure my safety?
- When you are on the website, open up your MetaMask Wallet.
- On the top left of your Metamask (Desktop) you will see a green dot that says âConnected.â Click Connect, and from there you will have the option to âDisconnect.â This will shut the site off from having access to your wallet
What should I do with my $SOS Tokens now that I have them?
This is entirely up to you, and there are a few options.
Sell them. You can simply take your winnings and transfer them to another cryptocurrency. This will wipe your hands clean of any volatility that we may see in the future. Go buy your girlfriend or boyfriend something nice.
Another option is to HODL! Diamond hands, baby!
If you believe that more people will buy into this, and want to just gamble on speculation, (given nothing has been voted on) you can wait until the price of $SOS rises, or falls, and sell at whatever price makes you most comfortable.
This is pretty interesting, but how did a made-up token create real value?
This is a WIP, but here is what I have been told so far.
The initial liquidity came from 9x9x9 and their cohortâs own pockets. So, for early sellers of the token, they received money from that initial pool. But because of the limited pool size, the value of $SOS was very low when being swapped for Ethereum.
In one Discord, I spoke to a user who received 500,000,000 $SOS as soon as it became available and immediately transferred it ETH, at a total value of .05, and at the time of writing equaling $200 USD.
As $SOS started to gain traction, hodlers decided to keep the $SOS instead of transferring it to ETH/other tokens, and at the same time, other people wanted to BUY the token. This became simply a case of supply and demand, where people were less willing to sell $SOS at the current price, and buyers were more interested in buying $SOS at a higher price.
Virality ensued, memes were created, and as of 5:30PM EST on December 25th, if those 500,000,000 tokens were held, they would be worth $3,665 USD (current price of $SOS, 0.00000733)
When we were taught about Supply and Demand, this is what our teachers meant.
Where does $SOS go from here?
For this answer, I have first pulled together announcements from @9x9x9 via Discord:
âWe made history TOGETHER! Now as promised, Lets make openDAO the most transparent, but also efficiency DAO in the space. Later today you will able to use $SOS to vote on the next step DAO takes. Like when we start staking? and LP incentive pool! + election for muti-sig wallet signers.”
Back to reality – who knows. In fact, there are endless potential opportunities for $SOS. As we shared earlier, growing demand for a decentralized version of OpenSea could be built, and that platform could use the commission from sales to buy and burn $SOS. Allowing deflation on the token would increase its value and price for long-term holders over time.
Along with governance, the token could be used for other things as well:
- Exclusive Access
- NFT / Web 3 opportunities
Help me tie up some loose ends, why did this catch wildfire and why is this so important?
Itâs first important to hear it from the person who launched the token, 9x9x9, who wrote in Discord,Â
âOne of the reason why $SOS is able to get so much support is because it is the only project that does FAIR FREE DROP based on your past 4-5 years of contribution. Any other airdrop, they have team reserve tokens, they have VC buying their tokens at a discounted price. You all got the $SOS for free! What else could it possibly improve? Were it just simply too good to be true? All contributors, including me, all want a better space and to show that anything is possible and make a difference/history.â
To reiterate, what is interesting is that there was no public or private sale of the token ahead of the launch. It was only claimable via airdrop.
Where are we at right now?
As of December 27th, $SOS currently has 270,000 holders of the $SOS token, which is REMARKABLE. In 72 hours, @9x9x9 has built one of the largest communities built on the blockchain. Check out more stats here.
To reiterate from my opening, the $SOS token/airdrop is one of the most brilliant marketing campaigns in history, and the opportunities are endless.
By taking advantage of the public access of the blockchain, $SOS was able to commandeer the success of OpenSea, without needing their permission, and share it with hundreds of thousands of people for free.
Even if the $SOS token goes nowhere, the significance is mind-boggling, and one we will look back on as something that changed the course of internet history. $SOS is a CLEAR example of showcasing the benefits that people can realize from spending their money and time online. Instead of just being a product of a company, this opens up possibilities of being an owner of every tool/product you use.
For now, we can use this as an opportunity to continue learning. What else could it possibly improve? Was it just simply too good to be true, and end up being another random day in internet history? Time will tell.
Good luck and be smart.
Follow me on Twitter @dylan_hattem.