SIP | Shut up and take my $RARE

Title: Shut up and take my $RARE

  • Author: Kyle Olney, Director of Product @ SuperRare Labs
  • Status: Implemented
  • Type: Governance
  • Implementer: SuperRare Labs
  • Sponsor(s): @ntomaino @VanArman
  • Link to Temperature Check Poll: Discord
  • Created Date: 02/04/22

Summary: Upgrade SuperRare network payment methods to include $RARE, DAI, and USDC

Abstract: With the launch of Spaces, SuperRare’s new “Bazaar” marketplace contract will include native support for arbitrary payment in any token adhering to the ERC-20 standard. This SIP proposes to update the master token registry of acceptable payment instruments on SuperRare network to include our native curation token, as well as two industry-leading stable-coins.

Motivation: Many artists and collectors who received $RARE tokens following the #RAREDrop in August '21 have requested the ability to either i.) accept payment for their artwork in $RARE, or ii.) make payments to acquire artworks using $RARE. Creating more utility for the $RARE token inside the SuperRare ecosystem is clearly in the best interests of the network, and would further support the goal of distributing governance tokens into the hands of a wider number of engaged/contributing community members - including those who have joined as Artists since last summer.

Specification: Utilizing the ERC-20 support functions of the new Spaces/Bazaar marketplace contract, the SuperRare Governance Council will update the payment methods registry to facilitate settlement of trades in $RARE, DAI, USDC, WETH and ETH. While the new smart contract supports this functionality natively, the visual design + front-end updates necessary to support this change in the application interface will need to be prioritized and scheduled by SuperRare Labs following successful passage of this SIP.

Benefits: Accepting payment in $RARE benefits the network in multiple ways by: i.) increasing utility of the $RARE token, ii.) distributing governance tokens to artists who are currently active participants in the network, iii.) allowing artists to be paid in stable-coins which are significantly less volatile than native cryptocurrency assets, iv.) organically diversifying revenue streams that feed into the community treasury, and v.) expanding the potential market reach for SuperRare by allowing holders of non-ETH crypto assets to transact more frictionlessly on the platform.

Drawbacks: The primary drawbacks to accepting $RARE / DAI / USDC are related to the cost of implementation from a design and engineering perspective. Interfaces will need to be redesigned to accommodate multiple payment methods, an increased number of front-end artifacts and APIs will be required, administration and accounting overhead for the community treasury will be marginally increased, and supporting the pricing of artworks in multiple currency instruments at a stable exchange rate may require the integration of an oracle / third-party pricing API which would be chosen at the discretion of SuperRare Labs.

Accepting USDC in particular would introduce counter-party risk, as this token is technically a “permissioned” asset maintained by a centralized, US-regulated counter-party (though it is still arguably among the highest quality non-bearer stable-coins in the industry). DAI on the other hand, is a permissionless stable-coin that carries no counter-party risks beyond the possibility of a normal smart contract exploit being discovered.

Outcomes: Once fully implemented, transactions on SuperRare will be able to be completed using $RARE, DAI, USDC, and WETH in addition to ETH. The community treasury will also begin holding multiple reserve assets on its balance sheet.

9 Likes

It might be nice for artists to have royalties paid in a stable coin to prevent surprise volatility in the market. But if the art is purchased with a particular coin will the royalty be in that coin that was used to purchase.

QQ about the system: is it primarily set on eth, ie are the prices in additional currencies updating with their relative value compared to the chosen eth price, or maybe the seller can set the main currency and its value? Just to be sure that we won’t have to set a price in dollars and can set it in eth still.

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Since artist royalties are paid out as part of the sale transaction– there is only whatever currency is a part of the sale already to really work with.

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I think they’d be separate. No underlying base currency or conversions.

So when picking a list price- you’d have to set the currency you’re listing it in. Same for auctions– when configuring the auction– you would set it up to only take bids in that desired currency.

2 Likes

By default, the royalties paid on will match the underlying currency of the transaction in question. E.g. If an artist decides to list a piece for $RARE, the royalties would be paid in $RARE. If the collector then decided to sell again on the secondary market for DAI, then the royalty payment would be made in DAI.

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In the implementation we’re proposing here, the artist can choose whichever base currency to list in and that price will remain static.

We’re also exploring ways to accomplish floating pegs but that’s much more work and will require further technical investigation.

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expanding payment options is a must! I know there has been talks for years about adding options for stablecoins and I love adding RARE into the ecosystem.

These can be really huge growth options for the platform and the RARE token.

3 Likes

I think this is a great idea that benefits collectors and artists and would like like to sponsor this proposal.

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Agreed with Nick – wonderful idea to add stablecoin options for those of us who hate to part with our precious ETH. At the same supporting a payment mechanism like Dai is a great sign to the Maker community, who greenlit RARE as a potential collateral type a few months ago. (disclosure – I worked for Maker before the Foundation dissolved).

Interesting, thank you!

I too like this idea - and am willing to sponsor alongside Nick.

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the only additional currency I think it might make sense in supporting from the get go would be WETH

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Hey All,

Noting for posterity that this SIP has been updated based on our conversation during recent townhalls to also include WETH as another payment method AND to clarify that the SR Governance Council will be responsible for executing the on-chain update to the payment methods registry rather than SR Labs.

We expect this one to be going up for a formal snapshot vote very soon!

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I’d also like to sponsor this proposal. Looks ready to go and I will post to snapshot.

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Love this, Always happy to accept other payment methods for Artwork. Especially $RARE.

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