Internet Token($INT)

A Perpetual Autonomous Decentralized Lottery

Internet Token Protocol was launched by some Anon on Friday March 22nd on Base chain with all the backend needed for the protocol to run perpetually and then renounced the contracts to the DAO with a proper governance built in for DAO to take over.

It is mindblowing how detailed and thought out everything was, everything about the protocol is as inline comments in one of the contracts which the community calls as their bible. There is no website, there are no socials and there is no team anymore. Everything about the protocol is to be found here https://basescan.org/address/0xdFd0bbFC8c188E923Bfb4fA5132C725d7D9c1988#code

There have already been some tweets about the core part of the protocol which is the lottery which is straightforward and it already has been a resounding success with a huge prize collected and created a stir in the ecosystem. There are three main tokens in the ecosystem.

There are three main tokens in the ecosystem.

• INT (The main protocol token)

• TKT (Ticket NFT)

• IFT (Infinity Series NFT)

INT

INT is the main protocol token, it symbolizes the ownership of the protocol. INT holders control the DAO, Treasury and all the various functions in the contract which they can tweak, upgrade and potentially decide where the protocol goes and expand.

INT supply (1 billion)

• 20% was initiated in LP

• 50% is with the DAO

• 10% is reserved for (GMX bond redemption)

• 20% IFT NFTs (More about this later)

LOTTERY

The core protocol function is to run a perpetual autonomous decentralized lottery where it works by itself with no intervention or action to be taken by anyone. The LP is set up as uni V3 Pools in uniswap with 1% buy and 1% sell fee. Each week a new lottery opens. Any buys generating $5 fees($500 worth of INT) get a ticket NFT(TKT) to be eligible for that week’s lottery draw. The fees are cumulative, which means you can buy small amounts over time and the time when your buy fees reach $5 you get a ticket. Each ticket is only valid for that week. 

At the end of the week a draw is made where there are two sets of winners from the TKT holders of that week. 

• 1 Main Prize. 

• 100 IFT NFTs for 100 TKT holders (This number halvens after every 5 weeks)

Protocol collects ETH from buys and INT from sells.

Main prize is 80% of ETH fees generated by the protocol + 20% of the INT fees.

20% of ETH fees which are left go to the Treasury. 80% of INT fees are burned.

As you can see it is a very interesting mechanism setup where speculation on INT, Lottery creates the prize, which creates more attention and bigger activity and bigger prize and cycle continues. INT is burned through the process, making INT a deflationary token and the protocol a revenue generating machine from day 1. It has already been a major success in the first week

Main prize worth over 100K and Treasury generating 22K and burning 2.24m INT(1.12% of circulating). 

Each week the draw is done automatically by the contracts and the prizes are airdropped to the respective TKT holders without any manual intervention and the next lottery epoch starts automatically. 

Liquidity is quite deep in this protocol. Currently there is $4.2m worth of liquidity with a market cap of $5.8m.

This is actually a great thing because it creates a deep stable ground for all trading activity for all parties involved. Lottery gamblers, Token Speculators, Investors etc. As the whole protocol is dependent on the trading fees and activity, deep and stable liquidity is important.Another pretty cool thing, even if the protocol gains more attention and say INT price goes up a lot it doesn’t affect the actual lottery gamblers cost to get a ticket. The cost to buy a ticket is still $5 ($10 if they don’t want to hold INT) This wouldn’t change no matter what price INT is trading at. In my opinion this is a very important innovation to decouple the lottery users from the price fluctuations of the INT token itself and keep the lottery accessible for everyone perpetually. 

IFT - Infinity Collection NFT

Now let us talk about something very exciting and very novel innovation in my opinion and which is what makes this pretty unique and incredible. Still barely scratching the surface of possibilities based on some cool discussions so far within the community. 

Here is description of IFT straight from the source

So as you can see each IFT is a tokenized NFT version of the protocol which has the power of 100K INT tokens. Each IFT can also be delegated and have the voting power of 100K INT in DAO governance. 

They can be minted by sending 100K tokens to the NFT distributor and the distributor would mint an IFT and then save the INT in a unique vault for you. You can pick any number you like for your IFT which is not already used or reserved. Each IFT can also be burned any time and you can get 100K tokens back but here is the catch: the unique number for that IFT is now burned forever and lost and can never be reused. 

So hence the infinity name but also at any time theoretically only 10,000 IFT can be in active state which includes the entire INT supply (of course practically not possible and will be a much lower number)

IFT Collections

The first 2000 IFT are booked by the protocol to distribute as additional prizes each week for 126 weeks starting with 100 each week and halving after every 5 weeks. This guarantees that these unique and rare IFT are distributed across the community and users and in turn making INT distribution decentralized.

What makes these IFT rare is their unique number and limited supply. No one else can mint this collection, you have to win them through a lottery and as each week goes their supply is crunching. If any of the lottery winners decide they don’t want to keep the IFT and go and redeem it for INT, that number gets burned and makes the rest in the series even more rare.

The other option for these IFT is to be traded like any other NFT on NFT platforms so they retain and keep their rarity and the value associated with their rarity. The beauty of these IFT unlike any other NFT in the market is they have a floor value which is 100K INT.

Current market value for these IFT is ~$2900(0.8 ETH). Imagine these getting listed next week in Opensea or any other platform with 1 ETH as base floor and with only 100 in starting supply in this collection, this would immediately put them as one of the top NFTs on Base with actual value associated with them and rarity preserved, anytime anyone redeems any one of them they are burned forever. 

There have been some discussions already where DAO could do an official commission with some professional NFT artists or partner with existing popular NFT communities to create art for these series. We can call them “Lucky Hands”(TBD). DAO has 50% INT in their treasury to be used for exactly things like this. DAO treasury is also growing each week, so DAO can slowly afford to make some bold moves in this space. 

Another idea which has been floated around is to do another collection for early adopters/investors of INT, “OG Diamond hands”(TBD). This collection can start from (2000 to 2222) and is also commissioned from DAO. The difference here is that these are not distributed through lottery winnings but rather voluntarily minted by early investors by tokenizing their INT and memorializing their OG status and giving them again the rarity status. 

What additional tangible value can we attribute to these rare NFTs? 

On top of already base value they have from the INT they represent and the rarity they bring in each collection, some additional ideas DAO can consider in future are 

• Say in future if there is some kind of rev share for INT, especially with their growing treasury, then IFT collections can be given additional boost based on how early they were and possibly even how rare they are. So early IFTs can have significant structural advantages built over in rev share compared to free floating INT or later coming collections. 

• There could also be other types of exclusive advantages built for collections which we haven’t thought out yet, which come from partner collaborations and partner benefits. Imagine we launch a special collection in the future in partnership with a special partner and there are some benefits coming from the partner tokens/NFTs etc which are exclusively reserved for the IFTs from that specific collection which again have their rarity and benefits preserved and any burns of those NFTs make the rest reap them. 

• As IFTs become more popular and start sucking the free floating INT a lot of trading could be happening directly through IFT, so DAO can also setup in NFT platforms to receive royalities which could be directed to the Treasury as additional source of significant income

• External NFT Lotteries. The code base already has core logic to distribute not only the main lottery prize but also NFTs as prizes. This code can be expanded where real world prizes can be tokenized and distributed as NFT to winners. Like for example: Dinner with a celebrity!

• As the main lottery becomes so big, it becomes a very interesting space for other protocols and communities to introduce their products and ideas to the INT lottery user base. This comes as a partnership and advertising collaboration for INT holders and the lottery winners. We could even do INT governance as a way to decide who gets to partner in a specific window creating a powerful use case and value for INT token. Maybe bribes?(Butterfly are you listening?)

These are all just a fraction of the ideas which the community has come up with some exciting discussions on the possibilities for this new novel idea which has never been tried in crypto. 

How to mint IFT?

If you read the bible you would have spotted it. In my opinion this is the holy grail of the bible. Right now it is a bit technical to mint custom IFT which is not being given as prizes where you have to directly call contracts to do it as there is no UI built yet. What is the saying - Early bird gets the worm?

// NftDistributor
// - Distribute weekly IFTs
// - Mint IFTs using INT
// - Redeem IFTs for INT
// https://basescan.org/address/0x2beC23ca7d5f75604907E8310bE82deA0100E5e2#code

// IFTs can be minted by using the NftDistributor.mint function
// STEPS
// 1. Invoke INT.approve(NftDistributor, amount), where amount is 1/10,000
// of the max INT supply, 10,000,000 INT: 10000000000000000000000000
// 2. Invoke NftDistributor.mint

// IFTs can be redeemed using the NftDistributor.burn function
// STEPS
// 1. Invoke NftDistributor.burn(IFT ID)

Note: Only do the above if you have some experience with how to directly interact with contracts in the explorer.

DAO - The dirty word 

Let us be honest, It is extremely hard to operate as a DAO, where you can truly get many people into consensus to run anything and often end up being in NAME only and they quickly turn out to be toxic.

I think a lot of it is also because a lot of crypto projects start with a team and there is team allocation, seed investors, token, token vesting and then later public investors and then community comes in. This is really hard to navigate through and become a functional DAO as there is always inherent expectations setup from the community with the “Team” and hence the never ending “Wen” questions. Maybe this is why it has been very hard to bootstrap a DAO this way?

Whoever this anon for the protocol has thought through this and have decided to remove themselves from the equation is the right way to kick off a fully autonomous perpetual lottery and DAO experiment. If you remove the forever burden of the founder then you remove that initial conditions problem for folks to come together and actually see that they are the ones who have to do the work to take it forward, there is not going to some person already there to solve their problems. This opens up immense amount of creativity to come from various sources.

Of course we are not starting from scratch, most of the important and core things are already set up but also given enough room and space for us to innovate and take it forward and all the tools have been provided along with the core product to take control. 

This is also why a lot of things and settings in the protocol are set up for longterm and not short and quick ponzi ways. For example taxes and burns are sensible not to pump things up quickly. IFT emissions are also set up for a very long term so they get distributed to community members and new lottery users diversified not just leaving it all for early snipers and investors. The ideas like halvening initial IFT distribution is an ode to the great satoshi himself.

A very exciting and bold experiment!