What exactly is an SOS token? Let's find out

On Christmas Eve came the good news for all NFT enthusiasts. Anyone who has ever bought an NFT on OpenSea can download a token called SOS

What exactly is an SOS token? Let's find out

Photo Credits: Pixabay

On Christmas Eve came the good news for all NFT enthusiasts. Anyone who has ever bought an NFT on OpenSea can download a token called SOS, and the amount of SOS that individuals received is determined by how much money they spent on NPTs in the OpenSea market.

By Sunday, about 240,000 people had downloaded their tokens, and their value had jumped by 1167 percent.

The token was not launched by the popular NFT market, but by OpenDAO, an independent decentralized autonomous organization.

Although the crypto space is saturated with airdrops and meme tokens, the SOS exploded. On Christmas Day, it was the biggest winner at CoinMarketCap. Most went with mostly symbolic amounts of up to $100, but those who spent larger sums on NFTs this year were also rewarded with 5 or even 6-figure sums.

According to St. Stephen's, the token had risen to a market capitalization of $321 million. Discord server has about 50,000 members, and 120,000 people follow OpenDAO on Twitter. SOS's market capitalization has since fallen to about $250 million, at the time of writing, a 26 percent decrease from the highest level.

How to download SOS?

The number of SOS tokens users can download depends on how much they used OpenSea, the most popular market for NFTs. The more they traded on the platform, the more SOS tokens they could get.

OpenDAO calculates how many SOS tokens it will give you based on your transactions before December 23. All OpenSea transactions processed after this date will not be counted.

When downloading each airdrop, users must pay a transaction fee on the Ethereum blockchain. The fee, denominated in ether, will depend on how congested the Ethereum network is.

A few days after the airdrop, major crypto exchange offices, such as OKEx, Huobi Global, and Gate.io scrolled through the token. Token also trades on decentralized exchange offices such as Uniswap and Sushiswap.

A pseudonymous programmer called 9x9x9 created OpenDAO. The encoder, who also builds a DAO called 721DAO.

SOS tokenomics

OpenDAO's website claims that there will be a total of 100 trillion SOS tokens. Half of it was distributed by airdrop. A further 20% will be issued as a takeover incentive, and another 10% will boost liquidity providers.

The final 20 percent is earmarked for the OpenDAO Treasury. The OpenDAO protocol will compensate OpenSea fraud victims, support NFT communities and artists, and provide money to developers.

There is no development plan for the project yet, as with most newly established DAOs, it all depends on the community.

Popularity of tokens

The popularity of SOS clearly shows what the user's expectations are for OpenSea to launch the token. Popular crypto projects such as Uniswap, Compound, and Aave have distributed control tokens to people who have used their platform, and many crypto users expect the same from OpenSea.

OpenSea is a company, not a protocol, and there is no reason to decentralize in the same way as protocols like Uniswap and Compound. However, OpenSea's community clearly wants an OpenSea token.

The company's newly appointed CFO Brian Roberts faced negative reactions earlier this month when he indirectly hinted at plans for an IPO.

Selling capital on the stock exchange would distribute ownership of OpenSea to wealthy shareholders, not community members. OpenSea said afterward that their "intentions were misinterpreted."

Independent DAOs like OpenDAO could use governance mechanisms to achieve similar things to OpenSea's token, such as allowing the community to determine which projects the DAO needs to fund.