“100days” is a community-based participatory art project which uses smart contract technology conceived by crypto artist CryptoZR in 2020. The artist chose 80 active members, who knew each other well, from a single crypto community and posed the question, “What will people do when given a choice between community reputation and profit?”.
Only specifically invited members could participate in this project. 80 Ethereum (ETH) are collected from these 80 members and placed into a smart contract. Only one of the participants can withdraw once (rug pull) from this pool of ETH at any time within the next 100 days, with a cap of 0.8 ETH per day, which will increase linearly daily. Only the first participant who initials the withdrawal will receive the amount of 0.8 Eth multiplied by X number of days. For example: If a participant triggers the withdrawal (A.K.A the Rug Pull) on the 10th day, they will claim 8 ETH from the pool of 80 ETH, gaining 7 ETH in profit. But the remaining 72 ETH in the contract will be refunded equally to the other 79 participants, and everyone will share some losses.
Trust and Money
Trust and money are inextricably linked. Trust is the confidence given to a reliable person. In the monetary system, trust is crucial. For example, if a person has enough “trust” or social credit, he can take out a loan to buy a house or a car. This loan is based on the bank’s confidence in the person’s social credit. The bank is confident that the person is able and willing to repay the loan, which is why it grants the loan to him. The higher the “trust” or social credit of the lender, the more available the loan will be, and the interest rate will be lowered.
The dominant monetary system used in today’s society is the fiat currency system, and the creation of the fiat currency is founded on trust. For example, a person short on funds wishes to purchase a property. He can apply for a loan from a bank based on his income level and his social credit; it shows the bank that he can commit to future installments, thus gaining a new sum of money in the present and paying it to the property seller.
Everyone is seen as a competitor in the capitalistic market, but in the Crypto-currency world, there exists a unique “ Community “ phenomenon. Members of different communities are also given social credit; your social credit will change based on your contribution to the community. But there is a difference between community and bank credit systems: the former is not bonded legally or physically, unlike the banking system, which can take away your house ownership if installments are not met. Betraying your community will only be met with moral condemnation; it cannot enforce any real physical penalties.
Creative progress and experimentation
In the earlier stages of the “100 days” project, the artist has envisioned many different outcomes, most of which reflect the participants’ possible states while participating. It is then realized that this state cannot be predicted, as it is strongly related to the personal experiences of these participants.
The “100 days” smart contract was released on the 22nd of September 2022; when the funding was completed, the project officially launched on the 27th of September. After only 48 hours, one of the participants triggered the withdrawal from the pool of 80ETH and received 1.59 ETH. At the same time, this activates the NFT issuance mechanism in the contract, which minted NFTs titled 2/100 days to the following 79 other participants. The artist was really interested in the motivation behind the participant who triggered the withdrawal.
「100 days」的智能合约最终发布于2022年9月22日，9月27日资金注入完成项目正式启动。仅过了48小时就出现了第一位参与者触发了rug操作，领走了1.59枚ETH，同时触发了合约中的NFT发行机制，为其余79位参与者铸造了命名为2/100 days的NFT。当然「100 days」并不是商业项目，持续的天数不是艺术家要考虑的关键要素。艺术家真正在思考的是，触发rug操作的参与者真正的动机，以及背后的理由。
The artist soon found the answer from the Crypto-community selected for the project: in the dilemma of morality and profit, the participant figured out the right approach, where everyone can get an equal refund at the end of the project. The other participants supported the decision. As to why this is the result of the experiment, we have to go back to the year 2021.
The story behind PUNK173 and DDDD
2021 was the year of NFTs. In a year where excess liquidity was happening everywhere and the record-breaking auction of Beeple’s digital art setting the market ablaze, avatar-based NFTs (A.K.A PFP) represented by Cryptopunks, BAYC, and others quickly gained market traction.
After VISA started purchasing Crypto-Punks in August, an influential crypto community proposed purchasing a Crypto-Punk (PUNK) through crowdfunding. It was then fragmented, and all members that participated in purchasing the PUNK will receive a share of ERC20 Tokens and the right to use and modify this PUNK as their digital avatar. 173 ETH was raised by 173 community members, of which 100 ETH were used to purchase PUNK 173 (PUNK edition 173), and the remaining 73 ETH were credited to a multi-signature wallet as a reserve for other projects. The purchased PUNK was modified and reconstructed by the community.
The original NFT was fragmented on fractional.art, and 1 billion tokens were generated under the name DDDD. 70% of the shares were allocated to the crowd funders, 20% of the shares and the remaining 70 ETH were used to provide liquidity on Uniswap, and 10% were used as a community vault reserve. Within a short period after DDDD was listed on Uniswap, the price increased by more than 10-fold, reaching a peak at 30 times the issue price. At this point, community members started to disagree on whether or not early participants should sell their Tokens, and different questions about human aspects emerged.
There were two main views: some members did not want to sell, hoping that the community could develop a little more; other members supported free market trading, allowing people to sell off their Tokens, and as the Tokens changed hands, new members would be introduced to the community. Eventually, the first point of view won a majority of support from the community, and if any member were to sell, they would be expelled from the community.
One of the members who urged the community not to sell ended up selling their Tokens; some of the members explained that they had recently lost a lot of money and were carrying loans and needed to sell the Tokens to make up for their losses. Others sold their Tokens to buy luxury cars. Every one of the sellers who sold their Tokens thought that they had a reasonable excuse. When people face questions about their own or the community’s interests, everyone has the right to vote. Then again, the market is a spontaneous place, and the final result will not change because of agreements made within the community, it only increases the implementation costs by a bit, and the market will eventually find its equilibrium point.
Some of the community members involved in the project had launched the well-known Defi project YFII in 2020, which fought the famous 120 battle station, where it held on to the $120 price mark in the face of continuous external selling pressure, and the price has since risen 100-fold in a month. The results of DDDD and YFII are two sides of the same coin: as the community faces external solid pressure, morality and profit can be on the same side, and vice versa is true where both are against one another.
The Auction of trust
Returning to the artwork, “100 days” is a reverse dutch auction of community trust, which attempts to figure out the lowest trading value for one’s community credibility. Still, of course, it does not represent the overall value of the community.
There are all kinds of communities in the crypto world, large and small, each with different motivations: code-driven technical communities, market-driven marketing communities, and price-driven speculative communities. If a project’s community membership is large enough, it will cover a wide range of motivations and generate its ideas at different stages of the market. Indeed, both the Bitcoin and Ether communities have experienced a turnover of members to enable newer iterations of the community. Many of the early core members of Ether have since created their own projects, and have made outstanding contributions with their new communities.
Trust in the Crypto World
Trust is an essential part of the financial world. In business transactions, a relationship of mutual trust between two parties can effectively reduce transaction costs. Banks are the links that ensure the trust relationships between buyers and sellers. It can be said that trust is the very foundation of banks. However, historically, because of the cyclical nature of finance, the collapse of banks’ credibility happens once every few years, causing many losses. The latest one was the subprime mortgage crisis in 2008 when Satoshi Nakamoto invented Bitcoin to hedge against the credit money system. The core philosophy of the Bitcoin community is “Don’t trust, verify,” where community members choose not to trust institutions and rely on distributed global nodes and cryptography to verify transactions. Using expensive POW mining was the only way to achieve this level of security.
金融世界中，信用是极为重要的组成部分。在生意往来中，双方互信的关系可以有效降低交易成本，而银行是大量构建买卖双方信用关系的纽带，可以说信用是银行的立命之本。然而在历史上来看，因为金融本身的周期性，银行的信用崩塌每隔一定年份就会发生一次，给人们带来损失。距离当今最近的一次是2008年的次贷危机，同年由中本聪发明了比特币来对冲信用货币体系。比特币社区的核心理念是“Don’t trust, verify”，社区成员选择不相信机构，而依赖于分布式的全球节点和密码学来验证交易。为了实现这种极端情况下的货币安全性，只能借助于昂贵的POW挖矿来实现。
In contrast, the Ethereum community has made compromises to expand its range of applications. Defi and NFT markets have since grown significantly in the last crypto cycle, attracting more ordinary people to the crypto world. With the implementation of the social credit system used in the traditional world, Tokens have become more stable, and the crypto market has since increased in 2020, but the inability to secure social credibility has led to the collapse of 3AC, Celsius, FTX and other prominent crypto institutions.
The Rug Pull-in “100 days” alludes to a common phenomenon in the crypto world: project owners breach promises to suspend project development, divert project development funds for private uses, remove DEX liquidity, or dump Tokens directly into the market. Unlike hard currencies (coins) such as Bitcoin and Ether, the credibility of the project owners is significant to the Tokens ERC20 and NFT. A small number of projects fulfill their promises, making the Token a valuable asset; In contrast, most projects fail or break their stakes; in this sense, there is not a lot of difference in the credibility associated with traditional finance.
It has been more than a year since the rise of the Web3 concept, of which decentralized autonomous organizations (DAOs) are an essential part. However, it is important to note that DAOs are still communities of people, and members make trade-offs between short-term and long-term development when faced with conflicting community philosophies and personal interests, as well as the significant conflicts articulated in “100 days”.
The crypto world is a free realm where people can join or leave a community whenever they wish. It is natural to leave an old community when it is no longer enough for personal growth and development. Although it may cause some loss for a specific community, from the global perspective of the crypto world, these losses can instead be an act of optimization.