The NFT community of the renowned Ethereum collection, Nouns, witnessed a rift. Consequently, a proposed fork from the project was finalized. Moreover, over half of all Nouns NFT holders chose to depart, pulling out a staggering $27.3 million in ETH from the project’s coffers.
Out of the 846 Nouns NFTs, 472 owners, nearly 56% of the collection, joined the fork. Additionally, they transferred a whopping 16,757 ETH from the Nouns DAO treasury to a fresh DAO organization. Hence, as a result of this fork, the original NFTs of these owners will revert to the DAO treasury.
Besides, each holder will receive a new NFT, mirroring the original artwork, for the new DAO. This new DAO will offer holders the option to “ragequit”, allowing them to claim their share of the treasury, which is 35.5 ETH per NFT. However, they would have to relinquish their profile picture permanently.
The decision to fork underscores a growing disillusionment with the current Nouns DAO format. Since its inception in 2021, the project has seen millions in ETH being utilized to back various Noun-centric ventures.
Significantly, these ventures aimed to amplify the brand’s presence, encompassing initiatives like a 2023 Rose Parade float, vinyl toys, 3D-printed clothing, a comic series, an esports team, and more. Moreover, in a notable move, Bud Light acquired a Nouns NFT, subsequently featuring “Noun glasses” in its 2022 Super Bowl ad.
However, the NFT market has declined since its peak in late 2021 and early 2022. Data from NFT Price Floor indicates that the price floor for Nouns has plummeted from a high of $267,000 in ETH in December 2021 to roughly $57,740 today.
Consequently, while the Nouns brand may have expanded through DAO-funded projects and marketing drives, its market value has dwindled. Some members, facing a harsh bear market, seem keen to cash out and salvage some returns rather than stay with the community.
An anonymous NFT holder, Hindsight, commented on the fork, emphasizing the lack of acknowledgment and discussion about the reasons behind the split and potential solutions.
The fork became feasible due to a Nouns protocol upgrade earlier this year. It permitted NFT holders to suggest a fork, allowing them to retrieve a portion of the treasury collectively. If at least 20% of tokens, through their holders, agreed, the fork would be executed after a waiting period.
Despite the split, the Nouns DAO retains 13,310 ETH, valued at nearly $21.7 million. NFT holders can still vote on proposals and allocate funds to nurture and bolster the brand. Seneca, a pseudonymous “Nounder” of Nouns, opined that the remaining members should intensify their efforts and utilize the treasury, emphasizing its importance in the Nouns game.