Why did the old coin r/datadao in the AI track make a comeback?

Author: Siwei Guai Guai, BlockBeats

Having spent a long time in the crypto space, I am no stranger to a project showing such a trend.

We have seen too many projects rise to fame only to decline, with both the community and the token price falling into complete silence.

Time in the crypto world is precious; every day brings new opportunities, and we know there is no need to stubbornly cling to a single project.

However, some projects attract a solid group of loyal supporters due to their unique qualities. Even after the speculators have dispersed, they continue to passionately build, trying to bring the project back into the public eye.

r/datadao is such a project.

The Glory and Fall of the First Data DAO

As the first data DAO, r/datadao was originally intended to combat the unreasonable ownership and disposal rights of user data by traditional Web2 platforms.

Reddit sells the content posted by users on its platform to AI companies for $60 million each year, but not a cent of that money reaches the users.

In the face of such immense injustice, r/datadao was born on April 4. It called on users to export their data from the Reddit platform and upload it to the community database, voting together to decide to lease the data to AI companies for profit sharing. Users could also earn governance tokens $RDAT based on their data contributions.

Subsequently, it was revealed that the driving force behind r/datadao was Vana, a crypto AI startup that raised $20 million from VCs like Paradigm and Polychain. Many big names in the crypto space rallied behind this project. The project team created a massive buzz, causing $RDAT to skyrocket from an opening price of $0.01 to a peak of $0.62 in just a few days.

The astonishing wealth effect led to the first batch of 20 million circulating $RDAT being completely claimed on April 8. The official announcement stated that there would be more batches, but did not disclose the total supply of $RDAT. Ultimately, the issue arose from this very point.

On April 11, r/datadao finally announced the second phase plan, delivering a heavy blow to all $RDAT holders.

The project team stated in the document: "Similar to Ethereum, $RDAT has no fixed supply. When new users contribute their Reddit data to the community-owned database, new $RDAT will be issued."

But they forgot one thing: while Ethereum does not have a fixed supply, the EIP-1559 and PoS upgrades created long-term deflationary potential for ETH. What about their $RDAT? It was just a useless governance token, which now turned into an infinitely inflationary "air token."

It seems the project team also realized that this approach was inappropriate and introduced a staking and referral reward mechanism. Participants in the first phase could earn more $RDAT by staking and referring others to participate, so their shares would not be diluted due to the increase in total token supply. But holding $RDAT only allowed one to earn more $RDAT; isn't this just a blatant Ponzi scheme?

Retail investors who had come to their senses chose to "cut losses for eternal governance," and $RDAT began its endless decline.

When the Decline Suddenly Stopped

I thought the story ended there. Occasionally, I would see r/datadao's official Twitter announce some progress on the staking mechanism, treating it as a bit of entertainment.

Three months passed quietly, and I suddenly noticed that $RDAT had stopped falling, even experiencing frequent "dead cat bounces."

Upon carefully reviewing the official Twitter, I discovered that r/datadao had quietly accomplished something significant: on July 7, r/datadao officially disabled token minting and relinquished contract ownership.

This means that $RDAT will no longer undergo any further issuance. The initial 20 million from the first phase, plus the 10 million issued in the second phase, constitute the total supply of $RDAT at 30 million. The reason for the endless decline of $RDAT has thus vanished.

In addition, another resolution was approved by the community—to collaborate with ORA to deploy a decentralized AI model and complete an IMO (Initial Model Offering) for this purpose.

First, regarding this decentralized AI model, it is much more reliable than other simple and crude money-making projects in the crypto space that merely wrap GPT. A former Google engineer developed this model for r/datadao. Prior to this, he wrote a detailed "Summary Analysis Report on Using Reddit Datasets for AI Model Development," exploring how to utilize r/datadao's dataset to develop an AI model capable of generating content in the typical style of Reddit, and pointing out the commercial application potential of deploying such a model in social media management, content creation, and user engagement strategies.

As for the IMO, it is not much different from a traditional ICO; it is about raising funds for the development of an open-source AI model. The IMO issues ERC-20 tokens (more specifically, ERC-7641 Intrinsic RevShare Tokens) to represent ownership of the AI model. Anyone who purchases these tokens becomes one of the owners of the AI model, and token holders can share the revenue generated when the AI model is used on-chain.

According to the tokenomics document, the new token $RDML has a total supply of 1 billion, with 50% allocated for this public sale of the IMO, aiming to raise $5 million at a price of $0.01 per token. The raised $ETH funds, along with a reserved 150 million $RDML, will be deposited into the r/datadao treasury. This means that through this IMO, the r/datadao treasury will suddenly gain $6.5 million in funds. The use of these funds is quite broad and can certainly include repurchasing $RDAT. And what is the current fully diluted market cap of $RDAT? Only around $1.5 million.

r/datadao hypothetically decides to use all $6.5 million to repurchase $RDAT; theoretically, it could buy back all circulating $RDAT at the current market price of $0.05 at a 4.33 times rate. (This is an extreme assumption; r/datadao cannot use all the funds, and $RDAT is not fully circulating in the market.)

Originally a token that was even less valuable than a meme, it has transformed into a value token with a well-funded community treasury and a stable source of income through this dazzling series of operations.

To Create Human Happiness, It All Depends on Us

I am curious how a project that was originally on the verge of collapse suddenly came back to life. After delving deeper, I gained a profound understanding of the lyrics from "The Internationale": "No savior from on high delivers; no faith have we in prince or peer. Our own right hand the chains must shatter; chains of hatred, greed, and fear."

It turns out that the r/datadao community has not been idle; on June 22, they elected a three-person group to serve as community leaders responsible for drafting proposals and leading the DAO. Among the elected, Agung Triyono (agungtriyonode) claims to be a listed partner of several CEXs and can liaise with CEXs to handle listing processes. Parslowed (lowparslow) claims to have close ties with ORA, while SuperKingCheese is the community OG who promoted this election. Each of these three individuals is talented, and their proposals indeed revived r/datadao.

Originally, r/datadao was a huge innovation in Web3 sucking blood from Web2, with immense imaginative potential. The previous token crash was merely due to the project team failing to find good solutions to address inflation; the new three-person group's proposals not only eliminated token inflation but also found new value growth points for the old tokens through the issuance of new tokens.

But do you think this is the end? No, r/datadao has another hidden benefit that has been overlooked. Yes, we have yet to unveil the veil of the giant Vana.

It is important to emphasize that in the future, Vana's mainnet will launch DLP (Data Liquidity Pool) slots similar to Bittensor's, and r/datadao, as the first DLP supported by the official, will definitely receive emission rewards of Vana's native token $DAT. These rewards will also flow into the r/datadao treasury, becoming another new source of funds for repurchasing $RDAT.