Ziriz Technical Doc

Sustainable Rewards for Talent and Taste Makers.

What? Ziriz replaces royalties with a primary sales structure to reward artists and their fans.

How? Each sale triggers a new sale at an algorithmically controlled higher price. The artist and all previous buyers are eligible to claim payment from the primary sale funds held in the contract.

Why? This system avoids the social and technical pitfalls of royalty implementations to establish a beneficial system for all players.

System Diagram

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Sales Structure Design

Problem

Royalties are broken on a social level. Rather than blaming technology for not being able to enforce royalties, Ziriz takes a step forward to ask why collectors don't want to pay royalties. In capitalistic terms, there's no extrinsic value in honoring royalties.

Solution

To remedy this, Ziriz replaces royalties with payments from a chain of primary sales. Each sale triggers three things:

The buyer gets a Soul Bound Token.
Funds are reserved to pay the creator and reward previous buyers.
A new sale is initiated at a higher price.

The creator and all previous buyers are eligible to claim payment from the primary sale funds which are held in the contract. To receive funds the collectors sign that they are performing the valuable work of discovering, curating, and promoting the creator.

Rather than relying on flakey referral links Ziriz leans into the "same team" mentality of communities that form around creatives and their fans. Early supporters who take risk on unknown assets can earn the most, late supporters still enjoy the intrinsic value of fairly priced ownership and community. Everyone wins with every sale!

The higher price is algorithmically determined to avoid unhealthy speculation. Paired with a buyers inability to dump, Ziriz collectables avoid the toxic behavior witnessed in many NFT communities. As a discovery mechanism, Ziriz frees creators from worrying about price and edition numbers.

By rewarding both creators and collectors Ziriz establishs a system that's beneficial to all of the players. After the creator, early collectors have the most to gain from each additional Ziriz mint. Everyone in the Ziriz chain has inclusive access to the intrinsic value of SBT ownership and the potential for future perks.

Each SBT contains a link to the asset that the NFT represents. The content could be a graphic, a song, a social media post, etc. The asset can be the same for every SBT or it can be different for each SBT for examples like profile picture collections, episodic content, or exquisite corpse collaborations.

Each Ziriz token also includes a pointer back to the previous end of the SBT chain. This makes iterating collections easy for activations like fan rewards. Examples include physical merch, gated content, event access, lotteries, allow lists for other mints, discounts, airdrops, etc.

Ziriz exhibit all of their properties when minting is left open forever. It's also possible to limit a mint to a number of editions or stretch of time. Such decisions can be set for control by the creator, a DAO, or collectors of the Ziriz. Assigning control to a group rather than individual also aids in recoverability.

Properties

Build positive community around creators.
Bring creators and curators closer together.
Crowdsource promotion for creators.
Pay curators for real work they are already doing.
Avoid technical pitfalls of royalty implementations.
Pay creators a livable wage.
Maximize community size via inclusiveness.
Artwork can never lose value, only gain value.
Transparent mechanics.

Reward Algorithm

Overview

The creator or contract owner has three levers to play with to effect the algorithm: starting price, artist curve, and fan curve.

Starting price is the first sale price. It is also the ammount paid to the artist with each sale if the artist curve is set to 0.

If the artist curve is set to anything greater than 0 then artist will receive a greater amount with every sale. This is linear so that it doesn't balloon out of control and to offer a differentiated mechanic to the fan curve. The smaller this number is, the slower the sale price goes up.

Fan curve dictates how rewards diminish for each consecutive buyer. If set to zero then every owner will make the same amount with every sale. If fan curve is set to anything greater than 0 then the earlier taste makers will receive greater rewards than later taste makers. The smaller this number is, the faster the sale price goes up.

An ending price is converged upon after some number of sales where the curves reach their pleatues.

Formula

artist base price

$A$
fan base price
$B$
artist linear growth coefficient
$L$
fan geometric decay ratio
$R$

for sale

$N$ (starting at 0) (mint)

artist cut:

$A + L * N$

fan cut:

$\sum_{n = 1}^{N} B R^{n} = B R^{1} + B R^{2} + B R^{3} + \dots + B R^{N} = B R \frac{R^{N} - 1}{R - 1}$

total price:

$A + L * N + B R \frac{R^{N} - 1}{R - 1}$

gas is not included

Background

As of 2023 NFTs are in a slump. They are under explored as ownership primitives. The industry is hungry for innovation at the infrastructure level to push digital ownership to a plateau of productivity.

Promotion has been a constant pain point for creators through 12 plus years of running the CODAME ART+TECH not for profit collective, a community with over 15,000 members. Simultaneously, organizers and volunteers aren't being rewarded for their taste making contributions.

Ziriz is a culmination of that environment and other inspiring touch points including:

Bandcamps story of focusing on existing behavior of creators and collectors (npr, guardian).
Art projects like Berry Cards and This Artwork Is Always On Sale.
Community support between artists on Tezos.
The meta of open editions on Ethereum.
Mechanics of
- NEP-171 on Near
- ERC-721 / ERC-1155 on Ethereum.
- ADR43 on Cosmos
- FA2 on Tezos

Relevant Terminology

Artist is synonymous with creator, seller, musician, writer, dancer, photographer, and any other role producing creative artifacts.

Fan is synonymous with curator, buyer, collector, influencer, community, A&R, and any other role that discovers and promotes creators.

Soul Bound is a non-fungible token that is non-transferable outside of recovery methods.