Unpopular Opinion: I don’t think ZINC is a rug, they owe nothing to the ZKFG holders, and MetaDAO works as intended
For those that haven’t followed, Zinc is the wildly successful “Private ORE” coin that is now the 2nd highest revenue generating protocol on Solana this week
It was created from the same team that launched ZKFG on MetaDAO, and it’s this part that is creating a lot of contention around the ownership of the successful Zinc protocol
The narrative (first shared by
@imprfekt) is that the ZKFG coin is the owner of the IP and the revenues. They raised funding on MetaDAO, and they used part of that funding to launch Zinc. Projects that launch on MetaDAO are considered unruggable, protected by a combination of futarchy and legal structures.
To their credit; ZKFG team has already returned 500k of fundraising back to token holders. That should have ended everything, but the team later suggested that a portion of the ZINC revenue would go back to the ZKFG Treasury. The enforceability and the legal requirement to do so is up for debate, but onchain analysis shows they have been sending money. The recent proposals to buyback the token and take ZINC private show that the team doesn’t want this to continue
The above is my attempt to summarise what’s happened so far. If there is a critical detail, I’d appreciate your correction in the replies
Below, I’ll layout what I think the situation is for each participant and what I think makes the most ”win-win” outcome
Many holders are suggesting that this is a rug; ZINC is a success and the original ZKFG holders are not going to enjoy the upside
This narrative is a problem for MetaDAO; you can’t have an unruggable platform if the most profitable one to emerge gives nothing to holders
But does ZKFG really own anything from ZINC?
I don’t think so. Maybe the Twitter account. In the next tweet I’ll prove that
They tried an idea, it failed, they returned what they had left, and went to do ZINC with the money they earned while working on ZKFG
Were the ZKFG holders able to stop them? Possibly they could have liquidated earlier, but not much more.
Did the ZINC team mislead ZKFG holders and later retract those statements? Yes
But the one truth that everyone will hate is that this could never be enforced with the MetaDAO framework; it wasn’t built for that, and it shouldn’t try to.
Now, people will pull them into a losing fight; relying on courts when no one involved wants to go to court
It can be a perceived blow to the Unruggable narrative; but I think that is wrong too. ZKFG was not a rug. The liquidation proposal worked. Everything is working as designed, but many are trying to take advantage of this narrative misperception
So what should they do? ZINC has no downside; there is no mechanism that can force them to give any revenue and there is no public blowback that can hurt the cash cow.
@WhiteWhaleLabs has also shown support, going as far as saying he will pay for any legal costs to ensure the team comes out ahead
MetaDAO has the most to lose if it tries to win a fight it shouldn’t be in; ZINC wasn’t launched on the platform and the team already returned funds from the original raise. By spending too much time and resources on this, Meta risks inflating the false narrative that this was a rug. There could be a failure to enforce any IP ownership. Other teams could look at this and consider it a bad option for their own raises
The best outcome is one where:
MetaDAO stays unruggable and enforces IP protections
ZINC is freed from any ZKFG relationship
To accomplish this, I suggest that ZINC forfeit their ownership of the Twitter account to the ZKFG holders or purchase it directly from them
This might sound silly, but it is a win for all involved. MetaDAO shows that IP was protected (ZKFG team changed the Twitter to ZINC, likely out of laziness to make a new account) and ZINC rids itself of this issue
But the bigger problem remains unsolved 👇