How a Failed Bid to Buy the US Constitution Turned Into a Meme Coin
Photo by Alexi Rosenfeld/Getty Images. Pictured: US Constitution
You've surely heard about Doge and Shibu Inu, digital coins that started as a complete joke and now have risen to more than $20 billion each in market cap.
But did you hear about ConstitutionDAO?
And I'm not talking about the failed fundraising project to buy the Constitution at Sothebys. I'm talking about the refund, which turned into a meme coin in itself.
You see, when Constitution DAO — DAO standing for 'Decentralized Autonomous Organization' — lost its bid to buy one of 13 remaining copies of the Constitution, those who donated were supposed to ask for refunds of coin $PEOPLE, which gave them rights to say what they wanted to do with The Constitution had they won. But since high gas fees associated with moving Ethereum seriously compromised what those refunds were going to be, a group organized to not accept the refunds.
In the last 24 hours the trading volume of $PEOPLE, which again was expressly used as a failed vehicle to buy The Constitution, is $95 million.
This is as those who ran the project claimed (at least publicly) that it was all over.
"Having lost the auction and following the core team's choice to wind down, we would like to remind you that the tokens possess no rights, governance or utility," the statement reads on its website. "It is also an option to keep your $PEOPLE tokens and do with them as you please — it is clear that there are parts of the community who wish to incorporate them in future projects. ConstitutionDAO cannot and will not endorse any future plans for the token."
As part of the plan, the group said on its discord that it would create a new token for future projects. This had the effect of making the coin nearly worthless, but not to worry: Creating a meme coin is now commonplace!
People started buying up the coin and ascribing value to it, even as the creators said it had no value. Within no time, ConstitutionDAO was pressured to shelve its plans to create a new token, and those who had DONATED TO BUY THE CONSTITUTION BECAUSE THEY COULDN'T INVEST IN IT BECAUSE IT WASN'T REGULATED BY THE SEC BUT THEN LOST THE CONSTITUTION BECAUSE THEY DIDN'T RAISE ENOUGH MONEY TO DO ANYTHING BUT TO BUY IT, had now created a coin of a value more than five times the cost of The Constitution on the heels of nothing.
All this is seen by those who are holding on to the coin as a natural response these days that has no consequences. But it does. It compromises the credibility of the idea behind raising money as a group through crypto and in some way compromises crypto itself, which is very much based on momentum and not news of any sort.
Weeks ago, ConstitutionDAO pat itself on the back for making "history" for being the underbidder on what was the $43 million bid to buy The Constitution. And while Decentralized Autonomous Organizations seem to be on the rise, this project calls into question whether they can ever be effective if the community overrules the organizers on what the purpose of the vehicle even is and whether organizations that own assets for sale would ever take them seriously.
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