July 2, 2022

EIP NFTs: How To Retroactively Fund Contributors To The Ethereum Ecosystem

4 min read

Introducing the EIP NFTs. Just authors of settled Ethereum Improvement Proposals can mint these brand-new NFTs that represent their contributions to Ethereum as a whole. This is a way to, not just recognize, but retroactively fund the work of the designers and thinkers that make the Ethereum ecosystem what it is. How will the marketplace worth these EIP NFTs? That’s what the experiment is about.

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Prior to we get into EIP NFTs, what’s an Ethereum Improvement Proposal? According to the task’s paperwork:

” Ethereum Improvement Proposals (EIPs) are requirements defining prospective new functions or processes for Ethereum. EIPs consist of technical specs for the proposed changes and serve as the “source of fact” for the neighborhood. Network upgrades and application standards for Ethereum are discussed and developed through the EIP procedure.”

4/ Each NFT that gets minted executes #ERC 2981 which indicates that royalties will be paid in perpetuity to the minting address (i.e. EIP author).

The art work is heavily inspired by @Uniswap v3 LP NFTS by @crypt0glitter. You can see the collection here: https://t.co/ba5hBSH7n0

—– blainemalone (@blainemalone) November 17, 2021

Retroactive Public Goods And The Results Oracle

Before we get to EIP NFTs, we have to check out the Retroactive Public Goods concept. As with whatever in the Ethereum community, this comes from the mind of Vitalik Buterin. “The core concept behind the idea of retroactive public goods financing is basic: it’s simpler to settle on what worked than what will be useful,” Vitalik explains in the post that poses the idea. The Optimism PBC company broadens on it:

” So … what would occur if suddenly, exits did exist for public items jobs? An exit figured out by how much public good has been developed by the task rather than quarterly revenue. Would we see more energetic investment and innovation on innovation that optimizes neighborhood benefit? Would we see more nonprofits prospering rather than making it through?”

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< img src=" https://s.w.org/images/core/emoji/13.1.0/72x72/1f389.png "alt="" class =" wp-smiley" style=" height: 1em; max-height: 1em;"/ > EIP Authors can now declare their EIP NFTs representing their contributions.https:// t.co/ zMgKr3eWVC

—– aka laboratories (@aka_labs_) November 17, 2021

How to answer those rhetorical concerns? The post provides a solution, once again in Vitalik’s own words.

” A DAO, which we can call “the Results Oracle”, funds public good jobs. Long term, the results oracle can be moneyed by protocol costs (eg. if executed by an L2 job, sequencer auctions are one prospect). But unlike other public items funding DAOs, the Results Oracle funds tasks retroactively, rewarding jobs that it acknowledges as having already supplied value.”

ETH rate chart for 11/24/2021 on FTX|Source: ETH/USD on TradingView.com
What Are The EIP NFTs, then?

Individuals behind the AKA Labs took the Retroactive Public Goods principle and stripped it of problems. They established a very first implementation that does not require to raise funds or to create a DAO. Let’s read their explanation.

” Acknowledging the truth that constructing a totally practical “results oracle” would be a large undertaking. This task dips its toes in and attempts to shine a light on the space.

The enjoyable part of this experiment is observing how the marketplace decides to value each EIP NFT. We fully encourage EIP authors to mint their NFT/NFTs and participate in the experiment.”

To mint EIP NFTs “users need to show that they’ve authored/co-authored an EIP.” So far, nine of them exist, however they haven’t produced any financial activity. This is where the Ethereum community comes into play. The process of evaluation starts with them. By making offers and moneying the retroactive acknowledgment themselves, they will define just how much each of the NFTs is worth. Will the most crucial propositions get a greater valuation? Or will the community value them all similarly?

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It’s worth noting that “each NFT that gets minted executes #ERC 2981 which indicates that royalties will be paid in all time to the minting address.” The minting goes through the EIP’s author address, AKA laboratories do not get a cut. The task is a not-for-profit, much like the jobs they’re attempting to assist prosper.

Will the EIP NFTs experiment succeed or fall by the wayside? That’s for the Ethereum community to decide.

Included Image: Screenshot from the EIP NFTs Open Sea page|Charts by TradingView