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1/
A couple days ago, I found myself having an argument with a friend of mine who stated that he thought #Sorare cards, due to its values being represented in $ETH and $ETH rallying as its been, were getting 'extremely expensive'.
A couple days ago, I found myself having an argument with a friend of mine who stated that he thought #Sorare cards, due to its values being represented in $ETH and $ETH rallying as its been, were getting 'extremely expensive'.
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I told him that he was focusing on the trees and not seeing the forest. That what #Sorare currently offers as a product is just the tip of the iceberg on what's to come.
I told him that he was focusing on the trees and not seeing the forest. That what #Sorare currently offers as a product is just the tip of the iceberg on what's to come.
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Here's a small thought-experiment of a product similar to Football Index built on top of the scarcity/ownership properties of a #Sorare card.
Very long thread incoming.
Here's a small thought-experiment of a product similar to Football Index built on top of the scarcity/ownership properties of a #Sorare card.
Very long thread incoming.
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There are 3 types of scarcity for #Sorare cards:
- Rare cards (Red background): max 100 cards per player per year.
- Super Rare cards (Blue background): max 10 cards per player per year.
- Unique cards (Black background): max 1 card per player per year.
There are 3 types of scarcity for #Sorare cards:
- Rare cards (Red background): max 100 cards per player per year.
- Super Rare cards (Blue background): max 10 cards per player per year.
- Unique cards (Black background): max 1 card per player per year.
5/
The max amount of cards per player/year does not have to necessarily be hit every year. There might be years that a CR7 Rare card hits 70/100 possible and there might be years that it hits the max. It will depend on how many cards are being rewarded and auctioned by #Sorare.
The max amount of cards per player/year does not have to necessarily be hit every year. There might be years that a CR7 Rare card hits 70/100 possible and there might be years that it hits the max. It will depend on how many cards are being rewarded and auctioned by #Sorare.
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Now, Football Index is a different kind of product from #Sorare. Honestly, I have yet to meet any Portuguese person that has experimented with the product, but from all I've seen around Twitter it seems to be popular for years now in the UK and a few other countries.
Now, Football Index is a different kind of product from #Sorare. Honestly, I have yet to meet any Portuguese person that has experimented with the product, but from all I've seen around Twitter it seems to be popular for years now in the UK and a few other countries.
7/
FI's concept is quite interesting. It rewards users with dividends based on goals, assists, man of the match, media appearances and couple other real life events, but for the users to be exposed to these dividends they must own shares of players.
FI's concept is quite interesting. It rewards users with dividends based on goals, assists, man of the match, media appearances and couple other real life events, but for the users to be exposed to these dividends they must own shares of players.
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The amount of issuance of shares is decided by the company behind Football Index. These shares are traded in markets that work the same way other markets do: you can buy shares from others, sell shares to others and at this point there are even order books.
The amount of issuance of shares is decided by the company behind Football Index. These shares are traded in markets that work the same way other markets do: you can buy shares from others, sell shares to others and at this point there are even order books.
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Some of these order books have higher liquidity than others. The liquidity per player share OB depends obviously on the player's popularity, recent performance or future potential. All these factors contribute to determine supply and demand for a given player's shares.
Some of these order books have higher liquidity than others. The liquidity per player share OB depends obviously on the player's popularity, recent performance or future potential. All these factors contribute to determine supply and demand for a given player's shares.
10/
As far as I know, you can't leverage long or short a given player's share price, you do have to actually acquire those shares from the company or from other participants and keep them in order to be exposed to dividends. Again, the company decides how many shares are issued.
As far as I know, you can't leverage long or short a given player's share price, you do have to actually acquire those shares from the company or from other participants and keep them in order to be exposed to dividends. Again, the company decides how many shares are issued.
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So, FI decides:
- how many shares per player per year are issued.
- how much of dividends per action per share is paid.
- shares are basically entries on a centralized database owned by the company.
Database entries belong to the company, so you don't really own any share.
So, FI decides:
- how many shares per player per year are issued.
- how much of dividends per action per share is paid.
- shares are basically entries on a centralized database owned by the company.
Database entries belong to the company, so you don't really own any share.
12/
Buying a share there doesn't make you owner of one in the sense that you can't transfer it anywhere else and be exposed to different dynamics, products and features. Precisely the opposite of what happens with owning a #Sorare card.
Buying a share there doesn't make you owner of one in the sense that you can't transfer it anywhere else and be exposed to different dynamics, products and features. Precisely the opposite of what happens with owning a #Sorare card.
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How could a product built on top of the ownership of a #Sorare card work with the goal to emulate/improve FI ?
It would need a few key components in order to emulate it and a few others in order for the community to have a better say in how the product should iterate.
How could a product built on top of the ownership of a #Sorare card work with the goal to emulate/improve FI ?
It would need a few key components in order to emulate it and a few others in order for the community to have a better say in how the product should iterate.
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I present to you, my initial draft of an #Ethereum-based Football Index, bootstrapped from #Sorare card ownership, driven by community governance, and with a few other key features that aren't possible on a centralized silo'ed product.
I present to you, my initial draft of an #Ethereum-based Football Index, bootstrapped from #Sorare card ownership, driven by community governance, and with a few other key features that aren't possible on a centralized silo'ed product.
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The user/manager would enter the website and connect its wallet (Metamask or any other) to it. In the wallet, the user contains the #NFTs representing each #Sorare card one owns.
The user/manager would enter the website and connect its wallet (Metamask or any other) to it. In the wallet, the user contains the #NFTs representing each #Sorare card one owns.
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As soon as the connection is established, the user would have access to a menu in which all cards one owns are loaded, and below each card there would be a button to claim shares for that card and scarcity.
As soon as the connection is established, the user would have access to a menu in which all cards one owns are loaded, and below each card there would be a button to claim shares for that card and scarcity.
17/
The amount of shares able to be claimed could be initially defined per the following numbers per each card scarcity:
- 1000 shares per Rare card.
- 100 shares per Super Rare card.
- 10 shares per Unique card.
These initial numbers serve the purpose of illustration only.
The amount of shares able to be claimed could be initially defined per the following numbers per each card scarcity:
- 1000 shares per Rare card.
- 100 shares per Super Rare card.
- 10 shares per Unique card.
These initial numbers serve the purpose of illustration only.
18/
These shares could be divisible up to, say, 3 decimals figures. Each of these shares would contain properties of ERC-20 tokens, and hence would be divisible.
You could buy 0.015 shares of a Mbappe Unique (if for sale) from somebody else and be exposed to its dividends.
These shares could be divisible up to, say, 3 decimals figures. Each of these shares would contain properties of ERC-20 tokens, and hence would be divisible.
You could buy 0.015 shares of a Mbappe Unique (if for sale) from somebody else and be exposed to its dividends.
19/
The math on the dividends is tricky but could be modeled, although in order to keep the scarcity type of shares in the platform valuable, the following rules should apply:
- A Rare share would pay y for a goal.
- A Super Rare share, x * 10 per goal.
- A Unique, x * 100.
The math on the dividends is tricky but could be modeled, although in order to keep the scarcity type of shares in the platform valuable, the following rules should apply:
- A Rare share would pay y for a goal.
- A Super Rare share, x * 10 per goal.
- A Unique, x * 100.
20/
Given data availability, there could be dividends for goals, assists and MVP, but also for passing accuracy, duels, tackles, interceptions, clean sheets and everything else that players do in the game.
Given data availability, there could be dividends for goals, assists and MVP, but also for passing accuracy, duels, tackles, interceptions, clean sheets and everything else that players do in the game.
21/
Inside the platform, the manager should be able to navigate the markets for each player, and for each player there would be markets for the 3 different types of scarcity. The manager should be able to buy some player's shares from others and to sell one's shares to others.
Inside the platform, the manager should be able to navigate the markets for each player, and for each player there would be markets for the 3 different types of scarcity. The manager should be able to buy some player's shares from others and to sell one's shares to others.
22/
This would keep the price discovery of each player and to each share scarcity in a free market context.
If you got here, you're probably thinking: 'Cool stuff, but you're basically describing FI on the blockchain. Is there something else?'
Yeah, there is. Keep going.
This would keep the price discovery of each player and to each share scarcity in a free market context.
If you got here, you're probably thinking: 'Cool stuff, but you're basically describing FI on the blockchain. Is there something else?'
Yeah, there is. Keep going.
23/
Every time a manager would produce activity in the platform -- to redeem shares, to buy/sell shares -- a number of <PLATFORM_NAME> governance tokens would be issued to that manager, following some model of decreased emission curve and up to a max total supply.
Every time a manager would produce activity in the platform -- to redeem shares, to buy/sell shares -- a number of <PLATFORM_NAME> governance tokens would be issued to that manager, following some model of decreased emission curve and up to a max total supply.
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These governance tokens would be used in order to vote on decisions related with everything that happens in the platform, similar to how most #DeFi products out there such as $COMP, $SUSHI, $UNI, $BAO are doing.
These governance tokens would be used in order to vote on decisions related with everything that happens in the platform, similar to how most #DeFi products out there such as $COMP, $SUSHI, $UNI, $BAO are doing.
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These governance tokens, being ERC-20s, could be traded on a DEX LP for ETH/DAI/USDT and others, depending on the liquidity pools available or created. If none available, anyone can create one, it's a free market, you don't need to ask permission to anyone.
These governance tokens, being ERC-20s, could be traded on a DEX LP for ETH/DAI/USDT and others, depending on the liquidity pools available or created. If none available, anyone can create one, it's a free market, you don't need to ask permission to anyone.
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Could whales generate more of these governance tokens than others ?
I guess they could, up to a point, but given that every action in the platform issues these tokens, I guess that initial distribution would be quite decent. Needs proper model and testing.
Could whales generate more of these governance tokens than others ?
I guess they could, up to a point, but given that every action in the platform issues these tokens, I guess that initial distribution would be quite decent. Needs proper model and testing.
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But can't they buy those governance tokens from others in order to be able to influence decisions further ?
Yes, they could, since there would be LP pools, but it'd be up to the smaller guys to sell them their tokens or not and at what price.
But can't they buy those governance tokens from others in order to be able to influence decisions further ?
Yes, they could, since there would be LP pools, but it'd be up to the smaller guys to sell them their tokens or not and at what price.
28/
"I see, so this is Football Index on-chain, with a governance token and built on top of #Sorare card ownership."
Sure, but there's more. What about a loaning/lending market of shares that could allow anyone to long/short a player's share and scarcity price ?
"I see, so this is Football Index on-chain, with a governance token and built on top of #Sorare card ownership."
Sure, but there's more. What about a loaning/lending market of shares that could allow anyone to long/short a player's share and scarcity price ?
29/
The baseline would be this: lend your shares and receive a market defined rate for them, or post ETH as collateral and loan shares from others.
The baseline would be this: lend your shares and receive a market defined rate for them, or post ETH as collateral and loan shares from others.
30/
The rates would be defined by the free market for each player-scarcity share, and would likely be heavily correlated to the #Sorare card market prices. There would probably be a ton of arbitrage opportunities back and forth.
The rates would be defined by the free market for each player-scarcity share, and would likely be heavily correlated to the #Sorare card market prices. There would probably be a ton of arbitrage opportunities back and forth.
31/
When a manager lends a share (or a part of a share), the manager that loaned it pays with the market hourly/daily rate and is exposed to the dividends that share generates.
When a manager lends a share (or a part of a share), the manager that loaned it pays with the market hourly/daily rate and is exposed to the dividends that share generates.
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A note on market buy/sell orders: the settlement would have to happen on-chain and gas fees would have to be paid by the buyer. The other option would be using an L2 (ZK-rollups or Optimistic-rollups or other) so that the gas prices would be orders of magnitude lower.
A note on market buy/sell orders: the settlement would have to happen on-chain and gas fees would have to be paid by the buyer. The other option would be using an L2 (ZK-rollups or Optimistic-rollups or other) so that the gas prices would be orders of magnitude lower.
33/
Long draft already. So, in this thought-experiment you could:
- redeem shares from players based on the scarcity of the #Sorare cards you own.
- buy/sell those shares.
- get governance tokens to get a say on how the platform works and improves.
- loan/lend your shares.
Long draft already. So, in this thought-experiment you could:
- redeem shares from players based on the scarcity of the #Sorare cards you own.
- buy/sell those shares.
- get governance tokens to get a say on how the platform works and improves.
- loan/lend your shares.
34/
How would the platform make money ?
There's a trillion ways to do it from taking fees from all activity. There's also ways to take some advantage of future issuance of shares. There's also ways to develop a community fund and a dev fund.
How would the platform make money ?
There's a trillion ways to do it from taking fees from all activity. There's also ways to take some advantage of future issuance of shares. There's also ways to develop a community fund and a dev fund.
35/
I really don't know how this idea will be received, but I wanted to put it out there. Maybe someone will take on this draft and improve it towards something closer to a functional idea. I'm obviously open to discuss it further, so let me know what you think.
I really don't know how this idea will be received, but I wanted to put it out there. Maybe someone will take on this draft and improve it towards something closer to a functional idea. I'm obviously open to discuss it further, so let me know what you think.
