National Treasure 3: *Attempting* to Buy the Constitution

Hey there! Welcome to the IGIN newsletter. I'm glad you made it. Since this is our first time here, let me give you a little bit of an idea of what to expect from this newsletter before we dive in.

There is a lot of things going down on the internet on a daily basis. The natural inclination for many of these trends is to just brush them off, but a few of these have caught my eye — namely, web3 and the creator economy (which I'm betting will have a lot of overlap in the next few years). 

However, there's a language barrier right now. You have to be ~in the know~ to truly understand a lot of the things going on in the space... and that's where I come in. This newsletter will not only let you know what's going on, but it'll tell you why it matters.

The internet isn't going away anytime soon, and I'm pretty confident web3 and the creator economy are going to be a HUGE part of the internet going forward. So join me in learning what it's all about. Hopefully each time you read this newsletter, you'll leave with the satisfaction of getting to say  "ohhhh, I get it now".

"$41 million going once... going twice... SOLD to the...ConstitutionDAO?"

I had planned to use that as my opening line for this letter, but sadly, that's not how things played out.

(I was pretty confident that I knew what would be the outcome of the Sotheby's auction that went down last Thursday evening. Unfortunately, it didn't quite work out that way. Regardless, I think this still makes a great story and is a great intro into a lot of things going on in today's internet. So read on...)

If you browsed the internet last week, you may have heard the news that an original copy of the US constitution went up for auction. The event, which was due to be a rather boring multi-million dollar exchange from one rich person's private collection to another's, has transformed into a wild week that will surely go down in internet history.

So let's talk about it:

• An intro to web3. The future of the internet.

• DAOs explained. What even is a DAO?

• The Story of ConstitutionDAO. One week to buy a 234 year old document

• A big win. This is significant. For a lot of reasons.

An intro to web3.

We're going to build this story from the ground up, and to truly understand the phenomena that is ConstitutionDAO, first let me give you some background on internet history. To date, there have been two fully-fledged eras of the internet — Web1.0 and Web2.0.

You can think of Web1.0 as the era of read-only internet (aka. users consuming content). Although there are still plenty of websites we use today that fall under this model, the majority of us are most comfortable with Web2.0; this is the era of users producing content. Think of a news site where you read content as web1, and a social media site where you and other users generate content as web2.

Over the last few years, a new generation of the web has been gaining traction...yep, you guessed it — web3.

Now, I'll be the first to admit: web3 is complicated. It's still very new. And yes, it involves crypto.

But wait. Don't get scared off. I too used to hear "blockchain" and "bitcoin" and would run the other way, but I must admit — I have fallen down the rabbit hole, and ~I get it now~ (aka. IGIN, as in the name of this newsletter). I promise this stuff is really cool so stick with me here.

Web3 is all about decentralization. What does that mean? Let's think about this through the context of traditional finance. For example, when you open up a checking account with a bank, you give up some of your money's freedom. You may be allowed to tell the bank what to do with your money (paying off a credit card balance or moving money into other accounts), but the bank, as the centralized organization, is the only one with the power to actually move your money. Not ideal.

To solve this, web3 turns to cryptocurrency and, more importantly, the blockchain. Think of this as the ultimate inventory tracker. Rather than leaving a transaction up to the discretion of a centralized bank to confirm, in web3, every transaction is written into the record of the blockchain. If you send money to a wallet in web3, every computer on the chain can confirm that transaction. That's the power of ~decentralization~.

That's a very simplified explanation, and if you're new to the space, I wouldn't be surprised if that wasn't enough to convince you of the power of this huge innovation. But, hey. This is just an intro. There are a ton of ways people have begun utilizing this technology already, and we are only in the infancy of web3. I'll dive deeper into some interesting use cases in future letters.

But for now, let's dive into one such example...

DAOs Explained

Decentralized Autonomous Organizations — DAOs. 

There's our buzzword again: decentralized. So what does it mean this time? 

This is actually a pretty tough to one explain. The most oft-used comparison is that a DAO is like a company, except rather than being controlled by a CEO, it is self-governed by its participants. 

Because of this system, all of the incentive lies with the participants. It's like the classic saying... "Teamwork makes the dream work". Every DAO has its own culture and focus, but the overarching theme is to create value for its members through participation. By creating value for the DAO, members are also creating value for themselves. This value might lie in financial rewards, social connections, or even the satisfaction of joining together to attempt to purchase a historical document worth +$40 million...

The Story of ConstitutionDAO

Let's set the scene. 

The year is 1787. The US Constitution has just been written. 500 copies printed. Congress sent them out all over the country to help shape the world we know today. Powerful stuff.

Now fast forward to last-last Thursday. A handful of web3-savy people discovered that one of these original copies of the constitution was going on sale at Sotheby's. Not only is this one of only thirteen surviving copies, it's also one of the two privately-owned copies in the world. Even with it expecting to sell for between $15-$20M, they decided to buy it themselves, in true Nicholas Cage fashion.

Hence, ConstitutionDAO was born. 

The goal was simple enough — raise enough money to purchase the CONSTITUTION!

Everything else about this project would be quite the opposite of "simple enough". The team of core contributors had a 7-day window from ideation to auction to try to make this happen. Here's just a few of the things that needed to get done.

• Formation: The team had to deal with the complicated legal formation of the group (which was supported by another group, Syndicate DAO).

• Sotheby's: They had to make sure the auction house would be willing and prepared to accept a bid from the DAO, along with ensuring they would accept the funding of the DAO in Ethereum (2nd largest cryptocurrency by market cap).

• Museums: The team had to find a world-class establishment to house, display, and preserve the document for the public to access after the auction.

• Press+Donations: The only way for this to work would be to bring in some $MONEY$. So they had to get the word out. More coverage = More money raised.

So they got to work...

And the numbers kept growing. I joined the Discord server on Monday when I first caught wind of this. Three days out from the auction, there was <5000 people in the server and less than $4 million of the $20 million goal raised. 

By Thursday ,the day of the auction, there were over 20,000 people in the Discord server, over $46 million had been raised, and the energy level was electric. 

This project held a lot of meaning for many — the idea of returning the constitution to the care of the very people who it was written for. 

So when the time came for the auction to begin, I, along with the rest of the internet, held my breath to see if history would be made. 

A bidding war started instantly, and within a minute, the price had already soared to $30 million, double the initial price estimate. The tension was at an all time high... especially because we weren't sure which of the two parties in the bidding war represented the DAO. 

After 10 nerve-racking minutes, the constitution sold for over $41 MILLION!

And we thought we had won...

So we began to celebrate. 

But the bad news came shortly after. The auction had gone above the max price the ConstitutionDAO could afford. An anonymous bidder had won, and the magic of the past week slowly began to vanish.

But I don't think this is truly the end of ConstitutionDAO's story...

A big win.

So if this whole thing was unsuccessful, why are we going to call this a win?

Well, simply because the whole world was watching.

This could truly be a turning point for web3. Let's remind ourselves why we did this in the first place.

Even without actually winning the auction, this project has proved the power of web3 to many of the people who don't understand it yet. It showed that web3 can be a force for good. Every time something like this hits the news, a whole slew of new people get onboarded into the web3 ecosystem, and an even bigger crowd gets exposure to its ideas.

For much of the population, cryptocurrency and decentralization feels confusing, foreign, and scary. However, in a lot of ways, this movement is similar to the principles of the US constitution itself. Beginning with the famous line, "We the people", its goal was to bring upon a new era in which we, the general public, have the power and freedom to do great things for ourselves.  Web3 wants to give us that power in today's internet-driven world.

And that is why I'm calling this a win. I'm excited to see what ConstitituionDAO pivots to going forward. I'll let you know if we decide to try to buy something crazy again... let me know if you have any ideas.

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-Levi