Case Study: Research & Investment DAO GCR (Global Coin Research)
Hello and welcome to MadeMeThink! Once a week I send out this newsletter with curated content, events and examples that have sparked my interest. It's a review of my last 7-days in Web3, NFTs and the Metaverse. Want to follow my thoughts on a daily basis? Then connect with me via Linkedin and Twitter. This article is also available in German.
To me, GCR (Global Coin Research) is an interesting case-study of a token-gated community. GCR sees itself as a research & investment DAO. As with most Web3 projects, its own Discord presence is at the center of the action1. The GCR Discord is also one of the few I visit regularly. On the one hand, there are weekly calls with relevant Web3 startups and other interesting content (e.g. the On-Chain Investigations Talk or Community Meetups) available via the GCR Discord. On the other hand, their "GCR-Weekly" Discord channel, which curates the most important news of the last week, has become an important source of information for me. It has become impossible to follow all the happenings in the Web3, NFT and Metaverse world, so such pre-selected aggregations of the most important news are helpful.2
Much of the content on GCR (e.g. the GCR-Weekly or other educational events) is free and available to all community members. Others require you to hold GCR tokens. GCR has different member levels built in (see below). The number of GCR tokens held determines what membership someone gets and consequently what content & benefits they receive in return. That means the token is a kind of a key and the number of held tokens determines which gates of a community are closed or opened (=Token-Gated Community). Personally, I am strongly interested in the research perspective and less in investments, which is why I "only" have the Gold Membership myself.
Originally, when I joined GCR, the highest Membership level required 400 $GCR tokens (bought my 400 $GCR in Dec 21 at about 1.55 Euro). Then a few weeks ago the membership levels were raised, the Gold level now requires 700 GCR and the new "Gold-Pro" membership 2,000 GCR tokens (= 7,540 euros; 1 $GRC = 3.77 euros on 3/28/22; see Coingecko). That means I had to buy an additional 300 $GCR at about 3.4 euros to continue being a Gold member. It is not unusual for Web3 communities to raise the entry barriers for their membership levels. But as a member of the community it can be annoying, because new tokens have to be bought to keep the same status. GCR has therefore given a discount of 50 dollar cents off the market price of the GCR token for subsequent purchases, which I think is a reasonable move. Still, there were users expressing their displeasure on Discord. So why even consider increasing membership levels? On the one hand, it's probably because different willingness to pay can be skimmed off. On the other hand, the smaller number of Gold Pro members can now be offered a better service. And last but not least, this should probably also increase the demand for the GCR token and positively influence its price development.
GCR tokens can be purchased on decentralized exchanges or earned through various activities. GCR uses their own token to trigger desired behavior in the community. Examples include:
- You share your crypto story and background with the GCR community = +10 GCR tokens as a reward.
- You participate in events or calls and are active there = +10 GCR tokens (for selected users) as a reward.
- You make a video and explain what GCR is = +200 GCR tokens (for the selected video) as a reward.
There are many different (desired) actions on the part of GCR that they reward with the issuance of their own GCR token. With Layer3 there is even a dedicated player to manage such "bounties" from Web3 communities. Written large on Layer3's website: "Earn Crypto by doing sh*t" and less attention-grabbing, but all the more important, below it says "Contribute to communities and earn in ownership". For completing the respective bounties, in other words for performing certain tasks, the user is usually rewarded with the Web3 community's own token. And this token represents a piece of the respective Web3 community. If the demand for the respective tokens increases, their value will of course increase and the owners will profit from it. Of course, the whole story goes also the other way around. Many Web3 projects are in the deep red with their own token…
Often with a token comes voting rights on important decisions of the Web3 project. The GCR token makes it possible, for example, to have a say in selected decisions. A tool called Snapshot is used for this purpose. The last vote, for example, was about determining how much carry there should be on investments. The entire voting process is transparent and traceable (see Snapshot). This is also typical for Web3 communities. What surprised me about the voting was that each wallet had an equal vote. Often in such votes, the respective vote is weighted with the number of tokens someone holds in their wallet, but this is currently not the case with GCR.
How the tokens of a Web3 project are distributed after their creation and what they are used for is usually described in a white paper or in the tokenomics. The tokenomics consequently describe the most important framework of the token. In the description of GCR tokenomics, we see, for example, that there are 10 million GCR tokens in total. 20% of them have been directly received by the extended team, and another 10% are held back for future team members. 70% of the GCR tokens are paid into the community treasury. What is done with them is determined by the community via the voting rights described above. To put the size of the community wallet in perspective, GCR currently has a market cap of €34 million.
Okay, that's it for today and maybe for this week. Although, after not sending out a newsletter in CW10 and CW11, I feel it's my duty to catch up and deliver something else ;) Maybe this week I'll report from the Metaverse Fashion Week on Decentraland, which I visited... stay tuned!
Disclaimer: The thoughts published in this publication are my personal opinions and should not be viewed as investment advice. I am not a financial expert. My specialty is entrepreneurship, innovation & marketing. Readers should always do their own research. I own various cryptocurrencies and NFTs, however in many cases it is for the sake of researching the field and gaining a deeper understanding of Web3, NFTs and the Metaverse and not for investment purposes.