[FIP - 4XX] Fund the development of the Fraximalist NFT project

[Westwood]

Authors:

@Westwood

Preamble:

The Fraximalist NFT Collection is designed to be more than just digital art; it’s a unifying force within the Frax ecosystem, giving the community something to rally around and fostering a shared identity. This collection embodies the innovation, culture, and spirit that define Frax, while also supporting the financial structure that makes the protocol strong. By integrating this collection with the broader Frax ecosystem, we aim to enhance community engagement and provide lasting value to all participants.

Overview:

The Fraximalist NFT Collection is a unique series of NFTs designed to embody the ethos of the Frax movement. This collection will feature a range of artistic styles across different seasons, with each NFT serving as both a collectible and a functional asset within the Frax ecosystem.

As the first fully-fledged PFP NFT collection on Fraxtal, the Fraximalist NFT Collection carries additional historical and cultural value. This pioneering project not only represents a milestone for the Frax ecosystem but also contributes to the evolving narrative of Frax, embedding itself in the legacy of financial innovation within the protocol.

Key Features:

1. Dynamic and Evolving Supply:

• The initial minting process will run for one week, during which collectors can mint NFTs with various traits.
• Each season will have a predetermined maximum supply.
• After the minting week, the art will be revealed, and the total supply for that season will be finalized. However, the overall supply of Fraximalist NFTs is not fixed as there will be additional seasons with new mints.
• The supply of Fraximalist NFTs is designed to be deflationary within each season, with no further minting beyond the allotted period for each season.

2. Refundable NFTs:

• To add an extra layer of security and trust for collectors, NFTs will be refundable for 95% of their initial purchase price. This partial refund mechanism is designed to maintain fairness and integrity in the distribution of NFTs. It also prevents users from exploiting the system by repeatedly refunding and minting to obtain a “better roll.”

3. Evolving Artistic Themes Across Seasons:

• Pixel Art: The first season features pixel art NFTs, capturing the nostalgia of early digital art and resonating with modern NFT collectors.
• Anime Style: The second season introduces an anime-inspired aesthetic, broadening the appeal to diverse collector tastes.
• Realistic Art: The third season will present NFTs with a realistic art style, adding depth and variety to the collection.
• Future Seasons: Subsequent seasons will explore other art styles, to be determined based on community feedback.
• Reason for Seasons: The seasonal approach is designed to offer variety for different users and collectors, accommodating a wide range of tastes and preferences. By offering different artistic styles in each season, the Fraximalist NFT Collection remains inclusive and appealing to a broader audience within the Frax community.

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Traits & Homage to DeFi:

The Fraximalist NFT Collection will feature a wide variety of traits across categories like headgear, clothing, accessories, and backgrounds, providing significant customization for each NFT. In total, the collection will include over 100 unique traits.

These traits are designed to pay homage to Frax and other major DeFi projects, such as Curve Finance, Ra, and more. Each trait reflects key elements from these projects, celebrating the broader DeFi ecosystem and its innovators. Subsequent seasons will include new traits as the Fraxtal ecosystem grows.

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Financial Mechanics:

1. Mint Cost:

• The mint cost is currently undecided, with a proposed amount of 1,000 FRAX per NFT. This pricing is intended to keep the threshold high, ensuring that the NFTs maintain a high-status value. However, this is subject to debate and will be adjusted based on community feedback.

2. FRAX Utilization:

• All FRAX from the NFT sales will be deposited into sFRAX, providing a stable yield-bearing investment that supports the Frax ecosystem.
• Profits generated from the sFRAX investments will be utilized to purchase FXS, further enhancing the value proposition for both NFT holders and the broader Frax community.
• The 5% of FRAX held back from refunds will be held in a community owned treasury that can fund future endeavors.
• This mechanism creates a demand sink for FRAX, adding more utility to the stablecoin and supporting its use case within the ecosystem.
• The strategic reinvestment of profits into FXS generates passive buy pressure, further driving the value of FXS and benefiting the entire Frax ecosystem.

What Frax Gets:

1. Bootstrapped Community:

• The Fraximalist NFT Collection will bring together both NFT and Frax enthusiasts, creating a bootstrapped, active community that rallies around a shared product and identity within the ecosystem (think The Llamas NFT and Curve)

2. New Demand Sink for FRAX:

• With FRAX being the primary currency for minting these NFTs, the collection creates a consistent demand sink for FRAX, adding utility to the stablecoin and ensuring ongoing circulation within the ecosystem.

3. Constant FXS Buy Pressure:

• Profits from NFT sales will be reinvested into FXS purchases, creating regular buy pressure on FXS and supporting its price. This mechanism ensures ongoing support for FXS holders and aligns with the broader financial goals of the Frax protocol.

4. NFT Demand on Fraxtal:

• As the first major NFT collection on Fraxtal, the Fraximalist series will drive significant attention and demand for NFTs on the Fraxtal chain. This project helps establish Fraxtal as a go-to platform for future NFT projects and Frax-related products, increasing network activity.

5. Incubator for Fraxtal-Related Products:

• The NFT treasury, funded by sales and refunds, could serve as a future incubator for Fraxtal-related products. These could be developed or funded by the community through the treasury, creating a self-sustaining loop of innovation within the ecosystem.

Additional NFT Perks:

1. Airdrops from Fraxtal Partners:

• Fraximalist NFT holders could be eligible to receive airdrops from Fraxtal’s partners, offering exclusive tokens, project access, or rewards, increasing the tangible value of holding these NFTs.

2. Special Discord Role:

• Holding a Fraximalist NFT will grant users a special role in the Frax Discord, providing them with access to exclusive channels, early governance discussions, and community events, fostering deeper engagement with the protocol.

3. FXTL Point Bonus:

• Fraximalist NFT holders could earn bonus FXTL points within the Frax ecosystem, enhancing their yield or increasing their participation in governance through an additional FXTL allocation.

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Decentralization & Smart Contracts

The Fraximalist NFT Collection is underpinned by a decentralized infrastructure, ensuring that all transactions, minting, and refund processes occur transparently and without third-party interference. The smart contracts for this collection will be written and deployed by Tibout Shaik, a renowned developer with a strong track record in the world of decentralized art and NFTs.

Tibout Shaik, who is well-known for his contributions to various projects on 256Art, has a history of developing robust, secure, and innovative smart contract solutions in the blockchain space. His experience with high-profile NFT projects ensures that the Fraximalist collection will operate seamlessly, maintaining security and trust within the ecosystem.

This ensures that only you control the funds from your NFT mints, and no one can rug you. The smart contract’s design guarantees that collectors retain full control of their minted NFTs and refunds. The only tokens that the team will be able to control are the 5% fee and the interest earned on sFRAX. By leveraging this decentralized structure, Frax ensures that all minting, refunds, and interactions are trustless and governed by immutable code.

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Long-Term Vision:

1. Multiple Seasons:

• If the first mint is successful, we plan to expand the Fraximalist NFT Collection into multiple seasons. Each new season will bring fresh designs, themes, and opportunities for collectors to engage with the Frax ecosystem.

2. Fraximalist NFTs as a Gateway:

• These NFTs are not just collectibles—they are gateways to Frax’s deeper ecosystem. As part of a larger strategy, they will evolve to integrate more utilities and governance roles, solidifying their place within Frax’s long-term vision.

3. Development of Frax-Focused Projects:

• The treasury generated by the collection will act as a fund for developing Frax-focused initiatives. Whether it’s new NFT products, dApps, or governance tools, the collection will support Fraxtal’s long-term innovation.

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Estimated Launch Date:

If approved, the Fraximalist NFT Collection is expected to launch in November. This timeline allows the development team to complete smart contract work, finalize artwork, and implement all necessary infrastructure for a successful launch. Any adjustments or delays will be communicated to the community in advance.

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Conclusion:

The Fraximalist NFT Collection is designed to benefit Frax at every level, from fostering community engagement to creating demand for FRAX and generating long-term buy pressure on FXS. Through a dynamic, evolving series of NFTs, Frax can expand its ecosystem, attract new users, and develop new products that sustain the protocol’s growth.

By backing the Fraximalist NFTs, the community supports the development of a sustainable ecosystem with a solid foundation for future innovation. With this proposal, we invite you to participate in shaping the next chapter of the Frax ecosystem.

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Soft Poll:

Thanks to feedback from @MichaelHenry I have included a poll to gauge interest in this proposal.

Would you buy an NFT of this project for 1000 FRAX (950 refundable)

• Yes
• No

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Voting:

For: Approve the allocation of up to $10,000 from the Frax Treasury to cover the development and launch costs of the Fraximalist NFT Collection, including smart contract development, front-end design, and back-end infrastructure. The team will only request the necessary amount from this allocation based on actual costs incurred.

Against: Do not approve the allocation of funds from the Frax Treasury for the development and launch of the Fraximalist NFT Collection.

[Sharkysnakefish]

While I support you doing this project in your free time, I do not thing Frax should fund it. We are already sacrificing development budget to save money, so I can not see any reason as to why this project is more important than the fundaments of the protocol.

You do not state who will run the treasury and how the money will be managed. I think Frax should have a position in that if we end up funding your project.

I think doing Frax bills as NFTs would be a better idea. I really like the mechanic you invented that will boost the underlying and the value of Frax. I just feel that the NFTs in and of themselves are not that relevant to Frax or feels like “Frax” to me. They are cool, yes. But also kind of generic. Having Frax bills would be closer aligned with the project, and if Frax had full ownership of such a project it would be something I could support. Although only after we can afford it. If you want to push forward with your idea, I recommend you ask the community and do some community research. Especially relevant since you ask the same community to fund it.

I also find it troubling that you are using your position as a Head of Community Development to push personal projects to get funded by Frax. You should be more aware of role conflicts, and try to stay neutral.

[0xlide]

Thank you @Westwood for great proposal.

Could you answer five questions to me.

1. How is the maximum supply for each season calculated?
2. How was the 95% refund rate figure calculated?
3. Who are the key members of the team?
4. Major NFT marketplaces like Blur, OpenSea, and Zora do not support Fraxtal. This is expected to be a significant barrier to attracting existing NFT collectors. Do you have any specific solutions or plans (e.g. collaboration with nft marketplaces)?
5. Is there a presale for specific token holders?

[Westwood]

Thanks for the feedback. The intention behind this project is not to detract from protocol fundamentals but to offer an innovative and community-driven way to add utility and engagement with Frax through NFTs. I’d like to address your concerns.

• Budget and Development Priorities: I completely agree that Frax’s core development should take precedence, especially in times when we are tightening our budget. If the community feels that funding should be allocated elsewhere, I will respect that decision. If there’s a consensus that this project is not a priority for Frax funding at this time, we can explore alternative methods of funding, such as third-party partnerships or community-driven contributions. Another option is asking for the funding as a loan that will be repaid with project profits. The amount I’m asking for is 1 day of Fraxlend revenues.

• Treasury and Fund Management: The treasury will start off as a community run multisig which will have trusted community key holders. The developer, myself, Sam, and any large/synonymous holders of the NFTs will be on the multisig. Large decisions will be made through snapshot with soft consensus made through the community discord.

• Conflict of Interest: I hear your concern about potential conflicts of interest. While I’ve been transparent about the nature of this project as something that I’m passionate about, I want to be clear that my primary role as Head of Community Development is to represent the community’s best interests. The intention for this project was actually included in my original Head of Community Development proposal. My intention is to add value, not detract from the larger mission of Frax.

I feel as though you have never been a part of an NFT community before. Having personally been involved with NFTs since 2021, I understand the power of community building they can provide. By also adding novel financial mechanics I believe this project has the potential to do something unique for the Frax community. I take offense to the idea that this is a “personal project” when my only intention is to provide more value to our community.

[Westwood]

1. Max max supply is predetermined by me based on opinion of market demand and ability to generate images. The final supply if the maximum isn’t reached is determined after the 1 week mint period.
2. I came to the 95% based on my own opinion. 90% seemed greedy and unnecessary while 99% didn’t seem like enough of a deterrent and doesn’t give the project much to work with. Like I said, these numbers are open for debate.
3. The details of the developer are in the proposal. It is me and him working on this.
4. We are in the process of finding a secondary marketplace to support Fraxtal. Its a bit of a catch 22 because there aren’t any NFT projects on Fraxtal so there is no incentive for marketplaces to launch.
5. No. I am trying to underestimate demand for this product due to the realities of the current economic situation.

[Sharkysnakefish]

Thank you for taking the time to write such a good and collected answer.

You write well, and give good reasons. I think due to the nature of the project that we should fund it on the terms that we will get free use of the code, or better the code becomes open source so other projects can easily implement a system that benefits to grow Frax.

I still would want you to revisit the idea, and see how well it resonates with the community. I think we can do better in reaching the core community and doing something more novel.

To comment, I have been part of several NFT communities and even started a project myself. Just the generic stuff was never any interesting for me. Ironically that was also what I created on a new blockchain, but made me realize the stupidity of it so I stopped.

[MichaelHenry]

Not an NFT guy historically but it seems like there’s an easy solution to this problem: Create a poll or get signatures from 10 people that they’ll buy the NFT and hold it. Then structure it as a loan. Win-win that way. Don’t understand the hate behind the treasury management, seems very straightforward that it can only be used for the benefit of Frax Finance as a whole. IMO, it’s probably more beneficial to never do buybacka and treat the money as POL that’s self-managed in a more high-risk and higher velocity manner than the main treasury is comfortable doing.

Conflict of interest claims feel unfair here because it doesn’t sound like you directly profit off of the deal. NFTs have been shown to create some vibrant and active communities, so this seems well within the realm of “Community Development”.

[Westwood]

While I’d love to accept your compliment about “writing well” I would be remiss if I didn’t acknowledge the help of AI to formulate my chaotic mind. My points are genuine however.

The most constructive feedback I’ve received so far is the payment structure and the art.

If the community doesn’t like the idea of giving the money as a grant I would be open to a loan structure instead.

As for people not liking the art I’m not sure how to assuage those concerns other than by saying that my intention is to have the final product look as good as possible. There are many traits and more characters that havent been revealed. The point of doing multiple seasons and art styles is to appeal to the broadest audience possible.

I think that for such a small investment in the grand scheme of things, this would be quite beneficial to the growth of the Frax ecosystem. I hope others can see that as well and put some faith in my ability to execute this vision.

[Sharkysnakefish]

I have no problem giving the grant as presented, as long as Frax gets the rights to use and distribute the code produced from the project. If not, it would be better to structure it as a loan imo, but also as MichaelHenry says, getting 10 people to buy to fund it is also a way that makes sense. I agree that is is a small investment in the grand scheme of things, but having the code base means we can build upon it in the future which would be a even bigger ecosystem boost long term.

Hope you will add that to the proposal. Then I will support it in full.

[Westwood]

The codebase would be open source. The only things “proprietary” would be the project website and NFT hosting infrastructure.

[C2tP-C2tP]

Don’t see why this should be funded by Frax itself. Should push for a community driven backing.

Edit: Frax team itself would obviously be up for lending a hand to people building on fraxtal. Just talking about initial funding.

[Westwood]

Thanks for the feedback. With you weighing in that tips the scale on my decision to pull out from this proposal and fund the project through external means. Unfortunately (or fortunately) this means it will become a “personal project” more than fully aligned with Frax. This discussion has given me even more great ideas on how to build this project and I’m very excited to continue building and improving on that. Look out for more details in the coming months.

[C2tP-C2tP]

I don’t see how that changes if it’s “fully aligned with Frax”. If it’s a Frax community project then it should be aligned?
All I’m saying is it probably doesn’t need to come from Frax treasury.

I personally would be up for donating some to help get the ball rolling once plans are finalized etc.

[Westwood]

I just meant that since the funding would be coming from frax itself that it would be “more official” than externally owned. Since the protocol is no longer taking the risk it just changes the dynamic a bit. It’s fine. You’re probably right that the risk should come from outside. I’ve already re-tooled the business plan. I think it will ultimately turn out better this way.

Before, the incentive structure was built in a way that all decisions would be subservient to the protocol since they’d be footing the bill. Now that they aren’t it’s a bit more “for profit” than purely serving the protocol.

[0xlide]

This is my feedback regarding this project. I wish for the project’s success.

1. I think the refund rate should be calculated in proportion to the holding period of the NFT, rather than being a constant value.
2. I’m not very excited about the art theme. At least the example images shown are not cool. It feels like a rehash of The Llama, and the human version example is very creepy. I recommend reconsidering the art theme and commissioning works from top-tier artists. My idea is generative art with fractals as the theme.
3. Conducting a presale for specific token holders is essential for the success of this project. If NFT sales are conducted only through a public sale, there’s a possibility that NFT traders with bots will mint in large quantities, potentially preventing veFXS holders and Frax core contributors from minting.
4. Creating an NFT collection using Frax’s name and receiving funding from Frax Finance will have a significant impact on the Frax brand. Please launch with overwhelming impact and the highest quality as an NFT project.

[Westwood]

1. Refund Rate:
   I opted for a flat refund rate so that the project can immediately utilize the exit tax and put the funds to productive use. A variable refund would introduce delays in accessing those funds and add unnecessary technical complexity, so a flat rate is the more efficient choice in this case.

2. Art Theme:
   I appreciate your feedback on the art, and I want to emphasize that the examples you’ve seen are just a small fraction of the broader style we’re capable of. The final outputs will be highly varied depending on trait selection, and each season will be designed to appeal to different segments of the community. While I know art is subjective, the real focus of the project is its financial underpinnings and alignment with the community’s goals. That said, I’m always open to constructive feedback and will do my best to ensure that the final product is of the highest quality. I will definitely ask for advice from some community members once the art is closer to final.

3. Presale for Token Holders:
   I completely agree that a presale for Fraximalists and core contributors is essential. This will help ensure that the NFTs are fairly distributed to the Frax community and prevent bots from dominating the public sale. It’s important that loyal community members have the first opportunity to participate.

4. Impact on Frax Brand:
   Since we’re no longer receiving direct funding from the protocol, the potential impact on the Frax brand is somewhat mitigated. However, we are still leveraging Frax branding and referencing other protocols, so we’ll be mindful of any potential PR or copyright issues and communicate with the necessary partners where applicable. Ensuring the project aligns with Frax’s values remains a priority, and we’ll take the necessary precautions to avoid any complications.

[feb5335]

Please don’t line your own pockets