Pronounced “Rah rah!” like a cheer, the goal of RARA’s protocol and this Loud Paper is to give a voice to a world of curators.
Introduction
Curation of media on the Internet relies on centralized curation of platform algorithms or permission of the media owner. While this system works well for platforms and those with enough money to have a platform, it ignores the broader society’s role in curation. Centralized curation algorithms define “Who are the curators?” and “What media matters?” Consumers of media are becoming wary of the hidden biases and incentives of these centralized curators and the quality of their media feeds. These biases can be avoided when all relevant data and curation algorithms are publicly available. However, this is not done in practice. In Web3, the curation data is publicly available but curation relies on Web2 algorithms or permission of the NFT owner. In the case of existing curation protocols, NFT ownership or permission is often required. As a result, curation incentives are premised on direct NFT sales and sales commissions by third-parties. These solutions prohibit the curation of NFTs not for sale, curation of NFTs without the owner’s permission, and otherwise curation by objective third parties.
What is needed is an open curation protocol for NFTs with transparent incentives for third parties to add social context to NFTs. Permissionless and composable curation replaces centralized curation. Anyone who cares enough can invest a small amount in a curation. Coupled with expression-based investments, communities will form around curation where social context is paramount.
In this Loud Paper, we propose a solution to centralized curation through a social curation protocol with transparent incentives and expression-based investments backed by NFTs we call “reactions”.
The Social Curation Protocol
RARA is a social curation protocol open to anyone wishing to curate NFTs with others. The objectives of the protocol are:
- Reward discovery and curation of NFTs;
- Enable personal expression through NFT-backed reactions; and
- Create public, composable curation data.
Curation is the act of adding context and, in the case of RARA, social context. Protocol users add social context to NFTs by burning NFT-based reactions on NFTs. The media of the curated NFT and the media of each Reaction create a media graph of society’s most loved NFTs.
Social curation enables anyone to become a curator and contribute to a network of curations. The curation is incentivized by the feedback loop of communities forming around things they like. Rather than paying for promotion, NFT owners and creators get paid for promotion and engagement as they share in the curation rewards (on-chain cash flow) generated by curator activity on their NFTs.
RARA’s protocol couples incentives and a socially curated media graph to create a clear providence of curation through appreciation. NFTs engaged as Reactions or curated by the protocol directly benefit across social and financial value systems. By making curation open to all fans of NFTs, the NFT conversation can move beyond price to impact on society.
How it works
- NFT owners (“Makers”) register NFTs to sell as “Reactions”, non-transferable, consumable tokens generated from the registered NFT’s media to users of Reactions (“Curators”).
- Curators buy and burn Reactions on other NFTs they like in exchange for Curation Tokens of the curated NFT. The types of Reactions an NFT receives add social context to the curated NFT, other NFTs receiving the same Reaction, and the NFT underlying the Reactions. For each Curation Token minted to a Curator, the owner of the NFT curated (“Taker”) receives Curation Tokens, as well.
- As more Reactions are burned, the value of a Curation Token’s claim on bonding curve assets increases. Curators that react early to popular NFTs may be eligible to claim more funds from the bonding curve than they spent on purchasing the Reactions burned - netting a profit for their early curation.
For example, Alice registers her “GM” NFT with the protocol to sell GM Reaction tokens. When Bob buys some GM Reactions, Alice receives a portion of the sale while the remainder is retained by the protocol for curation incentives.
Bob burns GM Reactions on Carol’s “Dope Song” NFT. Carol and Bob receive $RAdopesong Curation Tokens purchased from the bonding curve as an incentive to curate art.
Then, Eve burns “FOMO” Reactions on Carol’s “Dope Song” NFT in return for $RAdopesong Curation Tokens which locks up more funds in the bonding curve for “Dope Song” NFT. The value of Bob’s $RAdopesong tokens are now worth more than the purchase price. Bob can withdraw profits by selling his $RAdopesong Curation Tokens back to the bonding curve, or Bob can continue to hold onto his Curation Tokens in hopes that more Curators will react. Stated differently, Bob is incentivized to hold Curation Tokens as long as he expects “Dope Song” curation continues to trend, or better yet, become the next big thing - attracting more Curators to react. As popularity wanes, Bob’s incentives shift towards realizing the gains on his early purchase.
Register NFT to Create Reactions
Reactions
Reactions turn NFTs into the Web3 equivalent of a like, emoji, or meme. Curators use NFTs as Reactions to add social context to other NFTs. Reactions are consumed by burning the Reaction on an NFT - creating a permanent, portable reputation system for NFTs. As crypto consumables, the NFT owner and Reaction buyer agree to temporary terms of use for Reaction tokens defined by the number of transactions, block time, and smart contracts interactions. For protocol launch, Reactions will be consumed in one transaction per curation.
Reaction Transformations. Prior to the protocol release, RARA will reveal more information about how NFT media is transformed into Reactions.
Registration
Makers create Reactions by registering their NFT’s with the protocol to offer Reactions for sale. Any token conforming to the ERC-721 and ERC-1155 standards* are supported for registration without the need for wrapping, permissions, or allowances.
*Additional non-conforming tokens such as Cryptopunks will be supported at launch.
Using Reactions to Curate NFTs
Curators buy and burn Reactions for expression-based investing in curated NFTs.
Buying Reactions
Minting Reactions. ERC-1155 Reaction tokens are minted when funds are sent to the Reaction Vault. For protocol launch, the price per Reaction token is set at 1 $USDC/each.
Reaction Rewards. A portion of the Reaction sale is made immediately available for withdrawal by the Maker. At registration, Maker may optionally agree to share a portion of the Maker’s cut pursuant to any prior agreements with Creator. Third-parties who refer buyers of Reactions may also earn a referral cut set by the protocol.
Curating NFTs
Burn Reactions & Social Curation. Curators burn Reactions to curate NFTs. The curation is social in nature as multiple parties can curate the same NFT with different Reactions that add social context. For example, a Reaction can signify an NFT is funny or really loved by a specific community such as CryptoPunk Reaction users.
Exhibits & Comments (Optional). When burning a Reaction, Curators may tag a curated NFT into an exhibit or add a comment. Exhibits are the metagame of curation where the best Curators to show off their taste in NFTs with comments providing time-stamped, context on-chain. For example, a comment that “This piece is blowing my mind” weeks or years before others discover its impact can serve as a proof point for rising Curators.
Reaction Rewards for Curated NFTs. The owner of the curated NFT (“Taker”) receives a portion of every Curation Token minted when Curators React to their NFT. When Takers sell their Curation Tokens, they may optionally share a portion of the sale proceeds with the Creator if set at Registration. Third-parties who refer Reactions to Curator Vaults may also earn a referral cut set by the protocol.
Curation Incentives
Curation Token Vault. In exchange for burning Reactions, the Curator receives Curation Tokens equal to the value of the remaining sales proceeds of such Reaction tokens in the Reactions Vault.
Curation Token Pricing. Curation Tokens are ERC-1155 tokens priced by each curated NFT’s Curator Vault’s bonding curve. When Curation Tokens are purchased from the bonding curve, payment tokens ($USDC) are transferred from the Reaction Vault to a curation specific bonding curve (Curator Vault). As Reactions are burned and Curation Tokens are minted, the Curation Token price increases for future buyers (Curators) or sellers. The bonding curve acts as an automated market maker becoming the ultimate buyer or seller of Curation Tokens to the market of Curators.
Sigmoid Bonding Curve. For the protocol launch, a Sigmoid bonding curve will be used. The Sigmoid curve represents the adoption curve of many technologies and how content on the Internet traditionally goes viral - slow at first, a rapid rise, and slow growth onward.
Selling Curation Tokens. Reactors can sell their Curation Tokens and claim a portion of the funds in the Curator Vault. The amount of payment token ($USDC) returned is determined by the number of outstanding Curation Tokens, calculated using the bonding curve.
For the protocol launch, the price of Curation Tokens on the Sigmoid bonding curve is set to level out after 100,000 in $USDC is locked into a curated NFT’s bonding curve. Subsequent burned Reactions serve solely to add social context with proceeds contributing to Maker, Taker, and Referrer Rewards rather than Curators profit.
However, in practice there are many opportunities to enter a bonding curve due to moments of doubt and uncertainty in adoption. The resulting price chart of a Curation Token will not be a smooth line upward and to the right and more of a price chart similar to Uniswap’s Unisocks ($SOCKS).
The decision on whether to hold or sell Curation Tokens depends on one’s ability to predict the actions of current holders of Curation Tokens and future Curators reacting If you believe that a piece of content will attract more Reactions, then it is more profitable for you to hold. If you believe that a piece of NFT has peaked and will not attract more investment, then it is more profitable to sell your Curation Tokens. In aggregate, the decisions of individual Curators create a credible signal about the consensus of the community.
Withdrawing Rewards
The protocol Rewards are funds available for withdrawal resulting from buying reactions and curation activity. The following users may have protocol earnings available:
- Maker - owner of NFT registered as a Reaction
- Maker Creator - the creator of a Maker’s NFT
- Taker Creator - the creator of a Taker’s NFT
- Sale Referrer - application building a transaction for buying of Reaction
- Spend Referrer - application building a transaction for burning a Reaction and curating NFTs
Protocol Governance
As of publication, Governance of RARA’s protocol will include contract upgrades and modifying parameters and cuts.
Governance Roadmap
Phase 1 (Protocol Launch): Multi-signature wallet
Phase 2: Deploy $RARA governance token
Phase 3: Governance through $RARA DAO
Network Deployments & Upgrades
Network Support. The protocol will be deployed to Polygon at launch with an additional bridge contract on Ethereum to register and curate NFTs on L1. Additional networks will be supported on a case-by-case basis.
Protocol Upgrades. The protocol may be upgraded to address bugs or security concerns. Additional protocol upgrades may be approved upon request of the RARA community.
Glossary
”Curator” means a user who burns Reactions to invest in Curation Tokens.
“Curator Vault” means the contract that manages minting and burning of Curation Tokens and the funds associated with the related bonding curve.
”Maker” means the owner of an NFT registered to sell Reactions.
“Reaction” means non-transferrable, consumable tokens generated by Maker NFT’s media that are used to react and curate third-party NFTs.
“Referrer” means any application building a transaction for buying or burning a Reaction who wishes to receive sales commission.
“Reaction Vault” means the contract verifying ownership of NFTs registered for reactions, minting and burning Reactions, and managing Reaction Rewards.
“Registration” means the process of Maker or Taker proving ownership for Maker or Taker Rewards.
“Rewards” means the funds set aside for NFT creators, owners, and other ecosystem participants to be rewarded from fan curation activity.
Stay up to date with RARA’s protocol and app release by signing up for email updates at RARA.social and following @rara_social on Twitter.
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