Proposal: explore active management of auction parameters

To support daily Nouns auction price to be slightly higher than the “theoretical floor price”.

“Theoretical Floor Price” TFP can be calculated by dividing the total treasury by total nouns, also factoring in that every 10th nouns belongs to the core team). For Nouns 101-107 the TFP should be around 14601 ETH / 107 Nouns * 0.9 = 122 ETH.

However Nouns 101-106 have sold for significantly less than TFP.

Opinion on Causes

  1. Daily auctions are too frequent (demand supply issue)
  2. Auction bids congregate around the expiry time, with no incentive to bid early, and expiry time affecting whether Asia vs Western bidders are awake to make bids
  3. Treasury is growing at much faster rate than proposals to deploy the treasury

** Recommendations**
Allow the Nouns DAO core team (or nominated economics committee) to actively manage some parameters:

  1. Auction frequency - adjusted between 1 and 5 days to balance supply and demand
  2. Set “virtual bonus” on early bids which diminishes for later bids. For example, if a bid is made in the first three hours for 100 ETH it gets a +30% virtual bonus. This early bid will be worth 130 ETH and a last second bid would have to surpass that to win the auction. This will encourage gradual bidding competition throughout the auction duration instead of the last 10 minutes, potentially leading to better price discovery.

Additional comments
Regarding treasury deployment I see Nouns DAO, Wonderland TIME, BitDAO as facing the same issues: treasury growing faster than ideas to deploy it.

BitDAO has been exploring the idea of “Autonomous Entities”, maybe this is also worth exploring for Nouns, or some potential collaboration.

Here are some references:

cateatpeanut#9463 on discord