NFTs
So We Didn’t Buy The Constitution
November 18, 2021
An internet movement started last week to buy one of the only remaining original copies of the United States Constitution reached a roaring climax on Thursday night and then descended into chaos and confusion as almost no one seemed to know what the outcome was, how auctions work, who was bidding on the movement’s behalf, or anything at all.
Several news outlets reported that the Decentralized Autonomous Organization, aka DAO (pronounced “Dow”), representing the internet movement, had won, including the crypto-focused outlet Coindesk. The DAO raised approximately $47 million via ethereum contributions in a matter of just days from a total of more than 17,437 people who joined in (yours truly included). Knowing that, most people were lured into believing that the winning bid of $43.2 million had to have been the DAO. Unfortunately, the contributors seemed largely unaware of the hefty fees charged on top by Sotheby’s, the 8.875% sales tax, and more. I wrote about this two days prior.
This snafu seems to have been expected by those skeptical of an internet movement. Having actually stood outside of Sotheby’s earlier in the day in full George Washington-esque garb, I was asked by someone seemingly connected to a bidder if the DAO was aware of the added fees. I told them what I knew, but I couldn’t speak in the affirmative for the other 17,436 people.
Having also crossed paths with Julian Weisser, however, a Core team member and nice fellow, it was clear that he was extremely knowledgeable about all the details involved. Weisser was also the first team member to officially announce the loss on the discord.
“@everyone – We did not win the bid for the copy of the U.S. constitution.
While this wasn’t the outcome we hoped for, we still made history tonight with ConstitutionDAO. This is the largest crowdfund for a physical object that we are aware of—crypto or fiat. We are so incredibly grateful to have done this together with you all and are still in shock that we even got this far.
Sotheby’s has never worked with a DAO community before. We broke records for the most money crowdfunded in less than 72 hours. We have educated an entire cohort of people around the world – from museum curators and art directors to our grandmothers asking us what eth is when they read about us in the news – about the possibilities of web3. And, on the flip side, many of you have learned about what it means to steward an asset like the U.S. constitution across museums and collections, or watched an art auction for the first time.
We had 17,437 donors, with a median donation size of $206.26. A significant percentage of these donations came from wallets that were initialized for the first time.
You will be able to get a refund of your pro rata amount (effectively minus gas fees) through Juicebox. Please expect more details from us about this tomorrow – our team has not slept in the past week, and we are giving people the night to get some rest before we’re back at it tomorrow AM.
Every one of you were a part of this. We want to also thank our partners in this work: Alameda Research, Endoament, FTX US, Juicebox, Morning Brew, and SyndicateDAO”
Once the results finally started to kick in, feelings were mixed. Discord members were torn between feeling completely bamboozled or excited to use a DAO to make some other kind of meaningful purchase. The leadership behind the organization’s official twitter account signed off for the night early after working around the clock for about a week to even put the entire thing together.
gn everyone we’ll be back tomorrow
thanks for all your love and support. can’t wait to shape the next leg of this journey with you all 🙂 🌙 📜 https://t.co/Vhtiglpntg
— ConstitutionDAO (📜, 📜) (@ConstitutionDAO) November 19, 2021
By any measure, the dollars involved were astounding. This particular copy of the Constitution last sold in 1988 for the price of $165,000. Sotheby’s pegged the current value at $15 – $20 million. With $47 million in hand, winning seemed a strong possibility. The one major problem, however, is that with the blockchain being a public ledger, the rival bidder already knew the DAO’s best bid.
Overall, it was a rather strange experience, no doubt made more unusual by my throwing down eth and then donning a costume on the Upper East Side of Manhattan to the bewilderment of many locals.
Was this ultimately a loss for crypto or still a win? Only time will tell…
Buying the Constitution at $20 Mil? More Like $25 Mil
November 16, 2021
While crypto fans rally to hit a $20 million fundraising target in order to make a competitive bid for a copy of the United States Constitution on Thursday, lurking in the background is another cost, the auction house fees.
Known as the “Buyer’s Premium,” Sotheby’s charges 25% on the first $400k, 20% on the next $3.6M and $13.9% on the amount over $4 million, according to the auction terms.
That would mean that a $20 million winning bid would generate $3,044,000 in Buyer’s Premium Fees. And that’s before an additional 1% overhead premium equivalent to $200,000, bringing the house fees to $3,244,000.
Oh, and that’s not inclusive of the upfront sales tax of $1,775,000 (8.875% of the sales price).
All combined, the fees and taxes to take the $20 million haul off the premises, before transport, preservation, and security is: $4,819,000.
That means that the ConstitutionDAO would really need at least $25 million in its coffers in order to place a legitimate $20 million bid.
On Tuesday at 5pm EST, approximately 48 hours before auction time, the DAO had only raised 1,382 ETH, equal to about $5.87M. Sotheby’s starts the bidding at 6:30pm on Thursday at its location in NYC.
Time will tell if it is able to muster up the rest in time.
Crypto Fans Want to Buy The Constitution of the United States and They Might Actually Succeed
November 15, 2021
It’s the ultimate NFT, the Constitution of the United States. On November 18th, Sotheby’s will auction off one of the only thirteen surviving copies of the United States Constitution, an opportunity the public hasn’t had since 1988.
But a private collector hoping to pocket the national treasure will have some competition, the crypto mob on twitter. On November 11th, at least two individuals launched @ConstitutionDAO, a twitter account dedicated to crowdfunding crypto with the intent of raising enough money to be the winning bid.
The buyer would technically be a DAO, a Decentralized Autonomous Organization, a community-led entity with no central authority that is governed by a smart contract.
It’s predicted that if the DAO can raise significant cash before the auction that Sotheby’s will allow it to place legitimate bids. Sotheby’s put the estimated winning bid price at $15 million – $20 million.
It might not be out of reach, the DAO raised nearly $2 million in just the few hours since it began crowdfunding the money through a platform called juicebox.
If the DAO wins, theoretically “ownership” of the constitution would be fractionalized into shares based upon each member’s contribution. With a DAO, no one need even disclose who they are. Only a crypto address is required.
We have coordinated a DAO to acquire The Constitution of the United States.
I give you: @ConstitutionDAO
Ping me if interested in being a part of a monumental moment. https://t.co/VHkCTrq4fa
— Austin Cain (📜,📜) (@j_austincain) November 12, 2021
Members contributing to the pool of funds have the option of including a public message.
“To secure the blessings of liberty”
“Another first generation immigrant hoping to be the proud owner of the US constitution.”
“American Dream!!!”
“cant wait to explain this at Thanksgiving”
“in satoshi we trust”
The official website of the ConstitutionDAO is here.
For the sake of following the success or failure of this project accurately, deBanked contributed a very small amount to the DAO so that it could participate in the possible ownership and community of the Constitution. Weird, I know.
