DAO Raises $7M to Acquire and Fractionalize NFT Collections
JennyDAO wants to make rare non-fungibles more accessible for backers big and small.
Multicoin Capital and YouTube megastar Mr. Beast are preparing to make fractionalized non-fungible token (NFT) bets through JennyDAO, a new decentralized autonomous organization with $7 million to splash on crypto collectibles.
The DAO, launched earlier this week, now plans to begin acquiring rare NFTs for fractionalization through Unicly, another newcomer to Ethereum’s busy digital collectibles space. Other NFT DAOs are already on the scene, having made flashy purchases in January in the run-up to NFT mania.
JennyDAO’s fractionalization approach aims to put a distributed spin on the gilded halls of high-end NFT ownership. Pricey non-fungibles are, by their nature, inherently singular, and the most sought-after pieces can go for millions of dollars. But by fractionalizing a collection of valuable NFTs JennyDAO says it can make rare internet art more “accessible.”
“You could have a bunch of small NFTs but together within the collection it's worth a lot more,” project lead Jae Chung told CoinDesk. “Therefore people will be interested in getting exposure to the collection,” he added, comparing it to an exchange-traded fund (ETF).
Chung said anyone with the project’s uJENNY governance token will get a say in the collection’s shape. Thirty-six percent of uJENNY’s 10 million token supply will go to the DAO’s launch community.
“We want to increase accessibility and basically whatever amazing collection we make, the value and upside of it is shared by the supporters,” he said.
Those supporters include a number of notable crypto VCs, Chung said: 0xb1, IOSG Ventures, Moonrock Capital, Morningstar Ventures, Spartan Group, 3Commas, Vendetta Capital, Hillrise Ventures and Building Blocks. Each VC chipped into JennyDAO’s $7 million launch pool.
JennyDAO plans to keep its NFT collection in smart contracts on Unicly, an Ethereum-based protocol that specializes in fractionalized NFTs. Works will be added into Jenny’s Unicly vault based on simple majority votes, according to a blog post. Proceeds of a full liquidation would be divided up among governance token-holders, the white paper said.
“Fractionalization protocols allow access to liquidity of a patron/curator holding a collection, and reward retail collectors for recognizing the value of a collection and getting exposure to a fraction of it,” Multicoin partner Mable Jiang said in a Telegram message.
“JennyDAO, in this case, is a realization of the idea of ‘patronage as an asset class,’” she added.
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