Fair Launch Protocol Guide for NFT projects and their communities

Fair Launch Protocol was developed by Jordan (redacted_j) and Bartoz (baalazamon) as a social trust experiment and a system for offering fair NFT project launches while protecting both the community and the artists.

In this protocol, a project sells:
- Tickets to a lottery that distributes tradeable tokens that are redeemable for an NFT (either immediately or at a future date)
- At a community-crowdsourced price
- With anti-rug provisions for investors and projects

Buyers make 2 key decisions throughout the life of the project:
1. How much do you think a mint is worth?
2. Do you accept the final price?

For projects with a future delivery, if the team doesn’t meet the delivery date, you have a third decision:
3. Get a pro-rated refund, or give the team more time.

It all breaks down into 3 parts: Lottery, Waiting Period, and Redemption.

Lottery Phase 1 — Buying a ticket

Before you buy, you will have the opportunity to review the following to inform your decision:
1. Lottery Start/End Dates
2. Percentage of Treasury project is allowed to withdraw to fund development activities
3. Participation fee
4. Expected NFT delivery dates (either immediate redemption or future redemption)
5. Project’s minimum and maximum mint prices
6. Percentage of Tokens that must be redeemed in order to release remainder of treasury to the project.

Now, the project has done all they can to woo and inform you, but YOU get to decide how much you want to spend.

Do you drive the price down to get higher secondary market upside, but at the risk of not making it through the lottery? Do you improve your lottery odds but add secondary market risk?

You can change your mind at any time and withdraw your funds, less a small fee set by the project.

Lottery Phase 2: Price setting and participation decision

Lottery Phase 3: Token distribution

Waiting Period

However, many projects will choose to use FLP for fundraising, so they will have a Delivery Date that they committed to in the Lottery Phase. The Waiting Period is the time between the end of the Lottery and the Delivery Date.

Because the NFT IOU tokens that are distributed are regular SLP tokens, so wise projects will set up a DEX to allow these to be traded during the Waiting Period. Through trading, you can increase your allocation, or sell your allocation if you need liquidity sooner.

You will not be able to get a refund at this stage.

Delivery Date

When a project meets their Delivery Date
When the Delivery Date arrives then users will be provided with a Candy Machine or some similar mechanism to redeem redeem their token for an NFT. The remainder of the treasury is released to the team when a predefined percentage of tokens have been redeemed.

When a project fails to meet their Delivery Date
If the project fails to meet the date, holders of the token have a choice:
1. Hold onto their tokens and wait longer (if they still believe in the project)
2. Get a prorated refund (based on the unreleased amount of Treasury)

A project that is truly a rug will only come out with a very small amount of their original raise, as all holders will seek refunds.

A project that misses their date in good faith (they were too optimistic on their delivery date) can seek trust from the community and ask them not to return their tokens for refunds.

Anyone who gets a refund will not have their place held later if the project still delivers.

FLP Benefits for Project Founders, Developers and Artists

Fundraising

FLP can help buy you time by capitalizing on current hype while mobilizing your community and rewarding those who got in early.

Community mindfulness

FLP allows the community to set the price. They vote with their SOL within a range of potential prices you set.

FLP Benefits for Community and Investors

Getting in early

FLP allows community members to contribute to a project early on and secure they’re place.

Opportunity to influence price

Layers of protection

FAQs

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