A little over three weeks ago, on November 18, a group of Discord dwellers scrounged together $47 million to buy a rare copy of the U.S. Constitution at auction. And lost.
But don’t tell that to the token they created.
PEOPLE, which ConstitutionDAO contributors received for donating Ethereum to the bidding effort, hit an all-time high price of $0.17 today, beating its previous record of $0.16 set on November 27.
There’s not much use for the PEOPLE token, as the DAO’s leaders state: “The tokens possess no rights, governance, or utility other than redeeming them for ethereum from the smart contract held in Juicebox at a ratio of 1,000,000:1.”
Had the Constitution bid been successful, PEOPLE tokens would have represented shared ownership of the document. Instead, DAO members can just get refunds on their ETH, minus any transaction fees. Since the project collected over 17,000 donations—many in small amounts—some contributors have opted not to trade in their tokens so they can be destroyed; the current high transaction costs on the Ethereum network just aren’t worth it. Others are holding on, perhaps to repurpose the token for a related cause.
So, PEOPLE, with a maximum supply of over 5 billion, lives on as a speculative digital asset, like so many other tokens before it. And with an unknown number of redemptions slowly driving that supply down, the asset has become deflationary. In other words, the token is becoming increasingly rare, just like intact copies of U.S. founding documents.
PEOPLE is traded on a handful of exchanges, includes Uniswap, Gate.io, and BKEX. But the bulk of transactions are taking place on OKEx, which allows derivatives markets so that traders can bet on the future price of the token.
Coinglass, formerly known as Bybt.com, is keeping track of the market for PEOPLE futures on OKEx. It calculated $8.66 million in liquidations on Thursday, followed by a further $2.18 million Friday—with both bullish and bearish speculators losing out as the price whipsawed from $0.04 to $0.14 to $0.11 to its current $0.17 in under a week.
PEOPLE liquidations in December. Image: Coinglass
ConstitutionDAO became a test case in Web3 crowdfunding. Though it lost the Constitution to hedge fund manager Ken Griffin—who bought the document for $43 million after the DAO decided it couldn’t afford the additional storage and maintenance costs—it has motivated other projects. The FreeRoss DAO, for example, mobilized $12 million in funding to purchase NFTs created by imprisoned Bitcoin darknet operator Ross Ulbricht. It’s hoping to push forward his clemency effort.
But PEOPLE, like Ulbricht, isn’t free. Not as long as you can still trade it.
