[DAO:d7a7fa3] Integration of GBM Auctions in Decentraland’s Marketplace

Governance
1

by 0x89a1d730aa1e78a0ede8dea988acecff0a6e99a9 (Szjanko)

Summary:
The proposal suggests implementing GBM Bid-to-Earn auctions within Decentraland’s marketplace.

GBM Auction is a gamified auction mechanism where bidders make money if they are outbid. This can be in $MANA or whichever currency the auction is listed in and the percentage can be customizable by the auction creator.

For sellers this would incentivise users to participate and boost price discovery. GBM’s existing partners have seen a 200% increase in sales price.

For bidders & the community it would make use of the marketplace more rewarding and engaging where they either win the item or make money. Everybody walks away with something.

GBM has completed over 70,000 auctions and is working with The Sandbox, Rarible, Unstoppable Domains and Aavegotchi just to name a few. The founders are fully doxxed and have been working in the blockchain space since 2018, whilst being involved as early as 2013.

Hugo McDonaugh, CEO, DCL Username ‘ObiWanKenobi’ - Hugo McDonaugh - GBM | LinkedIn

Edouard Bessire, COO
https://www.linkedin.com/in/edouardbessire/

Guillaume Gonnaud, CTO
https://www.linkedin.com/in/guillaume-gonnaud/

Case Studies:

  • Aavegotchi Experience: Implementing GBM auctions led to a 160% increase in revenue. Aavegotchi’s platform offers both a traditional P2P marketplace and GBM auctions (Aavegotchi Auctions).
  • Song A Day’s Success: Transitioning to GBM auctions tripled their revenue in 100 days. High-profile endorsements, such as from Brian Armstrong, CEO of Coinbase, highlight its effectiveness (Brian Armstrong Tweet).
  • Other collaborations include Sandbox, Upland, and most recently with Unstoppable Domains, where again the asset sold for more than 100% higher than when English auctions were used.
  • An empirical study also proved how the GBM auction system has a higher first bid, higher bids overall, a higher selling price, a higher revenue for the seller, fewer bids and takes less time to reach its final bid than an English auction — all other things being equal. You can find it here:
    GBM auction versus English auction a large-scale empirical study - E. Bessire, K. Elhadji Tchiambou (October 2021).pdf - Google Drive

Statistics:

  • GBM auctions have successfully completed over 70,000 auctions
  • Had over $200m in volume run through their bidding engine
  • Generated over $54 million in revenue for their partners,
  • Bidders across the world have earned over $6 million in incentives

Integration Process:
The integration of GBM’s dApp is a straightforward process, taking approximately 1-2 days for basic setup, where the customizable GBM dApp is used as the auction house and hosted by Decentraland as a subdomain. Alternatively, a more advanced implementation where GBM is integrated into the existing Decentraland marketplace itself, offering deeper customization, would require around 1-2 weeks of development time.

Either option would include free white glove service and support from the GBM team working with the DCL devs for the smoothest possible integration.

Fee Structure:
There is no upfront investment required. No fixed costs or monthly running fees. GBM charges a 2% fee only on sales made through GBM auctions. Fixed-price sales and other non-GBM transaction methods are exempt from this fee. Full project management support also included.

Links:
GBM Website:

GBM Auction Deck :

Decentraland demo:

External Media

Voting Options:
This poll seeks the community’s opinion on integrating GBM-style auctions into Decentraland’s marketplace. The three options for this poll are the following:

  1. Full Integration of GBM Auctions: This option proposes to fully integrate GBM auctions into Decentraland’s marketplace. Under this model, GBM auctions would be integrated into the existing marketplace infrastructure which currently does not have auction capability. This approach aims to create an incentivized and dynamic marketplace with everything in one place. Users can still opt for existing sales mechanisms if they wish, GBM is just another option for them. Implementation support is included for free from the GBM team. Please see following mock-up of what it could look like:

  2. GBM Auctions as an Additional Option: This choice suggests adding GBM auctions as an alternative alongside the existing marketplace structure. The Decentraland branded GBM dApp would act as a stand alone auction house, but still hosted under Decentraland’s domain. It provides sellers and creators the flexibility to opt for either the traditional method or the GBM auction model for listing their assets and is also a lighter lift development wise. Implementation support is included for free from GBM team. Please see following video which shows exactly what this could look like:
    Loom | Free Screen & Video Recording Software | Loom

  3. No Integration: The third option is to retain the current marketplace model without integrating GBM auctions. This choice favors maintaining the existing system without introducing the new auction mechanism.

  • Yes, Full Integration of GBM Auctions into the marketplace
  • Yes, Add GBM Auctions dApp as a stand alone Decentraland auction house
  • No Integration
  • Invalid question/options

Vote on this proposal on the Decentraland DAO

View this proposal on Snapshot

1 Like
2

Hello @szjanko, I appreciate your insights on the mechanics, and I support the idea of adding an auction feature to the marketplace. This could increase participation, appears to require no financial assistance from the DAO and would need limited time spent on the developer’s side.

I can’t see a reason why we should not implement this. Sounds exciting and fun!
Jenn

3 Likes
3

The only problem I have with this is the fee.
I think this is a good idea.

But I think we should pay you guys to implement this but the fee goes to the DAO.

3 Likes
4

Can someone help me explain the pros and cons between options 1 and 2?

1 Like
5

Hey, when I asked @szjanko the same this is the reply that I received: For option 1, the downside is that it’s more complex, it could take some extra dev time to implement, but for option 2 on the proposal (the one I actually would like to see pass) I don’t see any downsides. It just offers all of us that use the decentraland marketplace another option, to either buy/sell as we currently do or to use an auction type of sale. The dev time for option 2 would only be 1-2 hours and the team from GBM would even offer free help if needed to set that up.

2 Likes
6

Does this not present an opportunity for scammers? To come through and lowball bid every item. Intentionally loss the bid & just collect the share?

1 Like
7

Hey @BET

When setting this up we can include a fee that goes to the DAO so they benefit as well.

2 Likes
8

Hi @OfficialCryptoCube, this is Cam from GBM.

Lowballing would actually be more prevalent in traditional auctions, where people are not incentivized to outbid.

With GBM, the % return a bidder gets is dependent on how high they put their bid in over the current one- this means bidders are incentivized to bid the fair price or close to it because a) they either win or b) they maximize their reward if they are outbid. Putting a low ball offer would not yield much reward.

On the case of people intentionally bidding just for the incentives, we do not see this as bids in a GBM auction are fully funded i.e. they have to have and commit the $MANA (or any currency the auction is in). This means there is always financial exposure, as if no one bids higher, they would have bought the item. With this kind of set up we see people who are genuinely interested in the item get involved, but get involved in a bigger way because of the reward mechanics.

Finally if people are getting outbid and earning rewards- it is only because someone has come in and outbid- meaning the seller is seeing demand and activity!

Hope that answers your question, let me know if you need more info.

1 Like
9

I think it could come down to technical details of implementation. I voted 1 but wish I could say try for 1 but if it will be way more work do 2 :smiley: One question I do have if we can put check for human here so there’s not tons of automation to take sales away from humans without that kind of auto-technology

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I vote yes not because of whether I like the person who made the proposal or not, their politics (whether woke enough / gender etc), but because it seems this COULD be good for DCL - maybe many legislators can learn from how I do this.

11

Hi @OGContraBand

If we do go ahead with option 1, then yes it could take some more time to get implemented - however we can always have option 2 running in the meantime as the dApp is very quick to set up. This means users would be able to test GBM auctions and get familiar with everything whilst the deeper integration is underway.

With regards to botting - I believe you are referring to sniping specifically, where bots put in bids in the last split second taking sales away from humans. With GBM, sniping is impossible as the time is automatically extended by a customizable amount when a bid is placed close to the end of an auction.

On top of this we have many other anti-bot measures that we can include on top for free, one example being captcha.

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Integration of GBM Auctions in Decentraland’s Marketplace

This proposal is now in status: FINISHED.

Voting Results:

  • Yes, full integration of gbm auctions into the marketplace 46% 3,939,596 VP (35 votes)
  • Yes, add gbm auctions dapp as a stand alone decentraland auction house 52% 4,519,075 VP (38 votes)
  • No integration 1% 2 VP (2 votes)
  • Invalid question/options 1% 89,935 VP (2 votes)
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Integration of GBM Auctions in Decentraland’s Marketplace

This proposal has been PASSED by a DAO Committee Member (0xfb1afa4dc069ffb47b19dbee196045d508fcd5a2)