An Introduction to $PUNKS
One of our goals at Pixel Vault is to help the company engage in more efficient discussions with NFT collectors. One area that we will focus on are common questions from the Discord and Twitter, which we will seek to explain in a clear and concise manner. Today we will be discussing the $PUNKS token, it’s treasury, and why its current circulation is extremely limited.
The $PUNKS Token
The $PUNKS tokens represent the 16 CryptoPunks NFTs that inspired the Punks Comic main characters. These 16 CryptoPunks were fractionalized so that the community could own a piece of NFT history. These CryptoPunks have been bundled, secured, and are now represented by 100 million ERC-20 fungible $PUNKS tokens via fractional.art. Additional details on the NFTs in the vault can be found at fractional.art (https://fractional.art/vaults/punks).
The $PUNKS tokens have never been available for sale. Instead, they are distributed as follows:
- Distributed on-chain to owners of PUNKS Comic, Issue #1 (50 million) through the staking mechanism for PUNKS Comic #1 and PUNKS Comic #1 SE holders.
- Distributed to the Pixel Vault Founder’s DAO (25 million)
- Distributed to Pixel Vault, Inc., the creator of Punks Comic (25 million).
- Note, an additional 184,535 $PUNKS were transferred to Pixel Vault, Inc. as part of the Company staking its assets.
Owners of PUNKS Comic, Issue #1 earn their share of $PUNKS by staking their NFT in one of the two smart contracts created for this purpose (see above links). Owners will earn their allotted 50 million $PUNKS tokens based on the number of comics they have staked. The $PUNKS tokens are distributed proportionately with all other owners who have staked their comics. It is noted that once an owner stakes their comic, such comic will no longer be tradable on the secondary market while in the staking contract.
The $PUNKS Treasury
The $PUNKS Treasury is for the community. Pixel Vault, Inc. is working alongside the community in building out the DAO mechanics so that $PUNKS token holders may make proposals on how to manage the treasury and provide the DAO with governance mechanics.
Today, the treasury has 1,480 ETH ($4.6 million) and was primarily funded through the following two projects and will be directed at the direction of the $PUNKS community:
- 30% of proceeds from the sale of MintPass #1 (232 ETH)
- 21% of proceeds from the Adidas collaboration (1,244 ETH) of which 100% of these proceeds went to the $PUNKS Treasury.
- Additional details on the project split can be found here (https://twitter.com/economist/status/1473329777947942912?s=20)
$PUNKS Circulation
Of the total $PUNKS supply, 49% remains locked in the staking contracts. This includes the main staking contract (48.2%), with the remainder held in a staking contract reserved for the special edition of PUNKS Comic, Issue #1 (0.8%). (https://twitter.com/pixelvault_/status/1455294915567570950?s=20).
Pixel Vault, Inc. holds 25.2% of the $PUNKS tokens and the Company has committed that it will not trade or otherwise sell those tokens except in limited circumstances outside of capital raising purposes (i.e., for future distribution to service providers).
The Founders’ DAO holds 25% of the $PUNKS tokens and will be able to vote on what to do with those $PUNKS tokens shortly. Pixel Vault, Inc. is working closely with the Founders DAO community to establish a voting mechanic in the next 30 to 60 days.
It is important for the collectors to understand that the publicly-available $PUNKS circulation is extremely limited at 775,037 or 0.8% of total tokens. The majority (0.7%) are held by collectors and the balance (0.1%) have been staked by community members in a liquidity pool.
Additionally, Pixel Vault, Inc. counsel has advised that due to the current regulatory regime the Company should not establish a liquidity pool for the trading of the $PUNKS token. Nonetheless, due to the open nature of blockchain technology, Pixel Vault, Inc. cannot prevent the establishment of any liquidity pool for the trading of $PUNKS, but encourages all ecosystem participants to consult with counsel to ensure compliance with applicable laws and regulations.
We hope that you found the above explanation useful. Please reach out to us or the community via Twitter/Discord with any questions.
