Neko Sales - The Dutch Auction
 Neko Sales - The Dutch Auction

Neko Sales - The Dutch Auction

Hello Sipherians! As you can probably tell from the title, we are going to take a different sales approach for the NEKO launch - a Dutch Auction! In this article, we shall discuss the following topics:

  • What is a "Dutch Auction"?
  • When, Where, and How will this be implemented for the NEKO launch?
  • Why a Dutch Auction?
  • Factors to consider
  • Finding Ideal value or price point for NEKO mint
  • Update on NEKO Whitelist: Private Sale
  • How do we plan to Improve on the Existing Dutch Auction Model?

Note that this article goes hand-in-hand with the creation of our Community Wallet that will be used to fund community projects and initiatives, in addition to providing rewards to our most loyal and engaging members! For more details, please make sure to read all about our Community Building Program in the following link -


What is a "Dutch Auction"?

A Dutch Auction is a type of auction that has been traditionally used for buying or selling goods. This type of auction is characterized by starting with a higher asking price or bid, and then the price gets lower as time goes by until a buyer accepts the price. In the case of NFTs, the main difference is that there are multiple items for sale - typically the amount of public sale slots available for minting - but the core concept remains the same. The NFT minting cost starts out at a higher price, but as time goes by, the price will periodically get lowered at specific increments set by the NFT issuers, which provides buyers with opportunities to mint their NFTs at the price they are willing to pay.

When, Where and How will this be Implemented for the NEKO launch?

The minting for NEKOs will happen on @November 7, 2021 1:30 AM (UTC), and will take place in the main website ( - same as our previous Sipher INUs launch. However, the main difference is that instead of having a traditional launch in which buyers wait for the minting to start and then being pit against one another in a gas war, the Auction will start at the established launch time with a starting price will be 0.9 ETH. Afterwards, the price will programmatically drop every 10 minutes in decrements of 0.05, with the lowest price for the auction being 0.1 ETH.

Regardless of purchase price, each participant can purchase up to 5 NEKOs per transaction, with a maximum of 5 per wallet.

Do note that as a Dutch Auction with limited NFTs available for purchase, the sale will automatically end at the point of time in which all NEKO NFTs are sold out, regardless of the current price point.

There will be 17 different price points where buyers will have an opportunity to purchase the NFTs. refer to the chart below for a visual representation of all price points and their respective durations:


At 10 minutes for each price point, the Dutch Auction will reach its lowest price of 0.1 ETH after a duration of approximately 2 hours and 40 minutes, assuming that there are still any available NEKOs for sale at that point.

Why Dutch Auction?

We decided to go with this sales mechanic after careful consideration and evaluation of different alternatives. In conclusion, we believe that for the NFT minting process there are certain benefits of having a Dutch Auction style rather than the traditional minting style. Some of these benefits are described below:

  1. Reducing the effects of GAS WARS - Depending on the hype of the project, these traditional "free-for-all" mint launches typically sell-out quickly. Additionally, participants can end up paying more than 2x of the original mint price many times due to gas wars.
    1. By leveraging a Dutch Auction sales mechanism, the NEKO launch will have 12 different price points and could last up to 2 hours, which could reduce the effects of gas wars. Keep in mind that if participants plan ahead of time, they could potentially find a price point they are comfortable paying to secure a NEKO "waifu".

      More information to help participants get prepared is included in the "Factors to Consider" and "Finding Ideal value or price point for NEKO mint" section below.

      Comparison: Gas Spent in Traditional Mint vs Dutch Auction Mint

      To validate that a Dutch Auction helps reduce the effects of gas wars, we've performed a small case study and gathered data of our Sipher INU launch (normal mint), and data from another NFT project, codenamed "Project X" for purposes of our comparison and documentation, which recently had a Dutch Auction Mint.

      Data from Project X was obtained and used as an example given they were one of the most recent Dutch Auction launches, currently have comparable trading volume on OpenSea, and the amount of NFTs available to mint in the public launch was around the same as our Sipher Inus (around 8K).

      Refer to the infographic below for the comparison of gas spent on each of the two launches.

      Infographic: Gas Comparison (Normal Mint - INUs vs. Dutch Auction - Project X)
      Infographic: Gas Comparison (Normal Mint - INUs vs. Dutch Auction - Project X)

    2. Total Gas Spent → As you can see, there was a lot more gas spent in our Sipher INU public launch as compared to Project X's launch, even though the amount of mintable NFTs were roughly the same (~8,000 NFTs). If we were to calculate the difference in Total Gas Spent between these two launches, there was approximately 1,884 ETH (≈$6.59 million*) MORE spent on gas from our Sipher INU launch, which went entirely to the Ethereum miners.
    3. Refer to the graph below for a visual representation of the amount of gas spent on each of these two launches.

      SIPHER Mint's Gas Spent is the Area in Blue, and Project X is the Area in Orange.


    4. Highest Gas Spent on one Transaction
      • The transaction that spent the most ETH in gas to purchase 5 Sipher INUs paid a total of 3 ETH (≈$10,500*) in gas costs - excluding the cost of the NFTs.
      • For Project X, the most ETH spent in gas for one transaction to purchase 5 NFTs was 0.89 ETH (≈$3,115*), which is a little over 3x in gas savings. Keep in mind that this transaction occurred nearing the end of the Project X Dutch Auction. Please make note of this because it should help with planning ahead for the NEKO launch.
    5. Highest Gas Spent on one NFT
      • The highest amount of gas paid for one Sipher INU was about 0.8 ETH (≈$2,800*), which is 8x the cost to mint that one Sipher INU (0.1 ETH).
      • For Project X, the highest amount of gas paid for one Project X NFT was approximately 0.18 ETH (≈$630*), which is about 1.8x of the cost to mint that NFT (purchase price at that moment of the Dutch Auction was 0.1 ETH). Similar to the transaction with the highest total amount of gas spent (above), please keep in mind that this transaction occurred nearing the end of the Dutch Auction.

      Note(s) & Resources

      *Note: We have included estimates in USD, assuming a price of $3,500 per 1 ETH as of @October 11, 2021.


  1. Deter/Limit Botting - The use of bots to secure a high amount of NFTs is common practice in the NFT space.
    • With the traditional minting process, individuals who know how to game the system have the opportunity to set up bots or smart contracts that automatically and quickly make multiple purchases of NFTs. This means that they can bypass the "maximum amount per wallet/transaction" limit since they likely have multiple wallets loaded with ETH. This is an issue which has happened to many highly anticipated projects in the past 2 months, usually at the expense of the genuine community members truly supporting those projects.
    • Botting is also a potential area of abuse with regards to raffle-based launches, as individuals with enough monetary resources and/or the technological know-how could set up multiple ETH-loaded wallets to gain an unfair advantage over majority of community members.
    • On the other hand, a Dutch Auction can help mitigate these areas of abuse given that it starts at a higher price where these individuals do not have a very strong incentive to purchase at the very start. However, it is not a fool-proof solution as they could possibly still attempt to purchase using their bots when lower price points are reached during the Dutch Auction.

  2. Funding a Community Wallet - Given that the majority of the funds and time of the Sipher Team is being spent on making the game a reality as soon as possible, we have created a system in which we will be promoting and incentivizing the development of our community and its amenities. The goal is to have our community be built by the people, and for the people. As such, a quarter of the additional proceeds (anything sold over 0.1ETH) from the NEKO Dutch Auction will be going into the Community Wallet. The remainder will be allocated in different areas to help to speed up development of the game, such as continuing to expand our team (currently have over 50 employees now), speeding up the fully-fleshed 3D Dungeon-mode game (originally was going to be a 2D Idle Expeditions), and continued investment to further polish the quality of our 2D and 3D in-game assets. You can learn more details about our plans for the Community Wallet and our Community Building Program here
    The Nexus Expansion Program

Factors to Consider Before Taking Part in the NEKO Dutch Auction

There are important factors to consider including, but not limited to:

  1. Your desire in securing your NEKO (how badly you want it)
  2. The maximum total cost you are willing to pay for a NEKO
  3. The amount of time you have available to participate
  4. Your interest in acquiring the Bonus Benefits from taking Part in the Dutch Auction
  5. Alternative option: there is always the secondary market (OpenSea) where you could purchase, but we can't guarantee the price you would need to pay.

We would love for everyone to get their hands on a Genesis Sipher NEKO, but unfortunately there's only 10,000 of them. As such, we hope that these considerations can assist you in your decision-making process. If you would like to participate in the Dutch Auction, we have included examples of different scenarios, which could potentially help you plan ahead. Refer to the section below for more details.

Finding the Ideal Value for NEKO

  • As Dutch Auction participants, you may find yourselves in a balancing act between speed (response time) and amount willing to pay (consequence of that response). We believe that planning ahead may be your best chance to ensure securing a NEKO "Waifu".
  • Please note that, although this Dutch Auction system could drastically reduce the effects of gas wars, it is entirely dependent on the participants. It does not necessarily eliminate gas wars if most or all participants do not have a plan or if the majority attempts to purchase at the lower points. This is why we can only try to minimize the exposure to such gas wars by providing various price points for participants.
  • In a hypothetically good scenario, participants would prepare and find a reasonable "average" price point they'd be willing to pay in order to secure their NFT and while paying a low amount in gas. We recommend that you plan and carefully consider our analyses below to make sure you are prepared for when the Dutch Auction occurs.

As part of our case studies on previous Dutch Auction, we've included our analysis of potential scenarios of a Dutch Auction:

  1. Participant attempts to purchase at the lower price points (more time spent waiting).
    1. Potential BENEFITS
      • Possibility of a lower purchase price → Depending on the amount of NFTs already purchased throughout the earlier stages, these participants could possibly purchase at a lower price if all stars are aligned in their favor.
      • More time to decide → Both a blessing and a curse, those who decide to wait can take an observant approach instead of "FOMOing" in. However they can run into the risks described below.
    2. RISKS
      • NFTs potentially selling out → If the participant takes too long to decide on whether to purchase at a specific price point, or waits to get the lowest price point, they take the risk that the other participants purchase all of the NFTs before that decision is made or before the price reaches the lowest point.
      • Getting caught in the middle of a gas war → If all or most participants wait too long, they are more prone to "fight" against everyone else who is also attempting to purchase at the lower price points. This increases the probability of gas wars given that, similar to a normal minting process, they begin "pumping up the gas" to attempt securing the NFT purchase.

  2. Participant decides to purchase at a higher price point (pays a "premium" and does not spend as much time waiting).
    1. Potential BENEFITS
      • They ensure that they can obtain their NFT → If these participants purchase their NFT at a higher price, it means that they purchased during the earlier stages of the Dutch Auction. They would pay a premium but get the benefit of ensuring that they obtain their NFTs.
      • Potential to avoid gas wars → If most participants wait for a lower price point, there is more likelihood for gas wars to take place. Participants that purchase on the earlier stages are more likely to purchase in a stress-free environment given the higher prices.
      • More funds for the Community Wallet → As mentioned previously, a quarter of profits above 0.1 ETH will go directly into the Community Wallet. An added bonus for paying the premium is that there are more funds available to spend on community projects or initiatives that benefit the community and NFT holders. Refer to the following page for more details related to this program -
        The Nexus Expansion Program
    2. RISKS
      • They pay a higher price for the NFT in the earlier stages of the Dutch Auction, but the price could continue to go lower after their purchase if the NFTs do not sell out at that higher price. This means that the participant could have potentially obtained a lower price if they had waited.
      • Refer to the graph below for a visual representation from Project X's Dutch Auction, which shows the Average Total Cost per Project X NFT - including Gas paid (first graph), and the Average Gas paid per Project X NFT (second graph) in relation to the different purchase prices set by the Dutch Auction. Note that it also shows how many NFTs were minted at each of those price intervals (represented by the red line).


        As you can see from the first chart above, the longer you wait (and the lower the price point), the total price of your mint roughly remains the same as those who purchased at a slightly higher prices. The main difference is that more of that cost is paid in gas which goes to the Ethereum miners, all while taking the risk that you will not be able to mint the NFT on time.

Dutch Auction Tier Rewards & Vessel Core Raffle

As a token of our appreciation for members who have decided to mint the NEKO NFTs at higher price points during the Dutch Auction, and therefore directly contributing to the acceleration of SIPHER's game development as well as funding the Community Wallet, the following benefits will be eligible to you.

4 Different Tier Rewards (Exclusive to Mints at and above 0.55 ETH)

For wallets that have minted the NEKO NFTs at or above 0.55 ETH during the Dutch Auction, you will be eligible for the Tier Rewards as follows:


Clarifications on Tier Rewards

What is used to determine my Eligibility for Tier Rewards (Diamond, Platinum, Gold, Silver)?

If you minted a Neko NFT at the respective tiers, we would have already collected your Ethereum Wallet Address, and you will be eligible to claim the respective tier rewards. That means, even if you sold your NEKO NFT which you bought, you will still be eligible to claim the Tier Rewards as long as you are still in possession of your Ethereum Wallet.

Are Tier Rewards are tagged to the specific Ethereum Wallet Address that I minted the Neko NFT on?

Yes. We will base the Tier Rewards using the mint transactions available on-chain.

If I mint 1 Neko NFT at 0.9 ETH (Diamond Tier), am I eligible for all the rewards on the lower tiers (Platinum, Gold and Silver) as well?

No. Tiers are independent of one another. For example, if you bought 1 Neko NFT at 0.9 ETH (Diamond Tier), you would only be eligible for the rewards that are listed in the Diamond Tier.

If I mint multiple Neko NFTs at 0.9 ETH (Diamond Tier), am I eligible for the Diamond Tier rewards multiple times on the same Wallet Address?

Yes! After careful consideration regarding community feedback on this, we would like to confirm that your wallet address will be eligible for the listed rewards multiple times, but with some exceptions due to limitations.

For example, if you decided to mint 2 Neko NFTs at 0.9 ETH (Diamond Tier), you would be eligible for the following rewards:

a) Get your Name Immortalized in Sipheria Twice

b) Obtain 2 Neko and 2 Inu Limited Edition Sculptures

c) Get your Name listed on the Hall of Frame Neko Platinum Tier once

d) 2 Sets of Exclusive SIPHER Bomber Jacket

e) Diamond Frame and Title once

If I mint 1 Neko NFT at 0.9 ETH (Diamond Tier) and then subsequently mint 1 more Neko NFT at 0.7 ETH (Gold Tier), am I eligible for both Diamond Tier and Gold Tier rewards on the same Wallet Address?

Yes! Again, after careful consideration regarding community feedback on this, we would like to confirm that your wallet address will be eligible for the different tier rewards in such a situation. For an example on your eligible rewards if you bought 1 Neko NFT at Diamond Tier and 1 more NEKO NFT at Gold Tier, you would be eligible for the following rewards:

a) Get your Name Immortalized once in Sipheria (From Diamond Tier)

b) 1 Neko and 1 Inu Limited Edition Sculptures (From Diamond Tier) & 1 Inu Limited Edition Sculpture (From Gold Tier)

c) Get your name listed once on the Hall of Frame's Neko Platinum Tier and once more on the Hall of Frame's Neko Gold Tier

d) 1 Set of Exclusive SIPHER Bomber Jacket (From Diamond Tier) & 1 Set of Exclusive SIPHER T-Shirt (From Gold Tier)

e) Diamond Frame and Title (From Diamond Tier) & the Gold Frame and Title (From Gold Tier)

If I mint multiple Neko NFTs at 0.9 (Diamond Tier), can I have the option to select rewards (e.g. Swag, Hall of Frame, In-Game Titles) from lower tiers?

Unfortunately, due to constraints, we are unable to provide such an option. In the event which you wish to acquire the exclusive Swag/Merchandise from lower Tiers, or to acquire the in-game titles or frames of other Tiers, you would have to mint at the corresponding tiers.

Character Vessel Core Raffle (Exclusive to Mints at and above 0.4 ETH)

NEKO NFTs that are minted at or above 0.4 ETH during the Dutch Auction will be entered into a raffle to win Character Vessel Cores (500 Winners). If your NEKO NFT won, SIPHER will airdrop a Token to your Wallet Address that can be redeemed (burnt) in exchange for a Character Vessel Core.

Clarifications on Character Vessel Core Raffle

What are Character Vessel Cores and why do they matter?

Character Vessel Cores are used in Sipheria as a material to clone your Genesis SIPHER NFT (Sipher's unique take on 'Breeding'). These Character Vessel Cores can only be obtained normally via gameplay, and therefore this raffle presents an opportunity to our earliest supporters to obtain an advantageous headstart in creating SIPHER Clones.

What is used to determine Eligibility for the Raffle (Vessel Core) for Minting a Neko NFT at and above 0.4 ETH?

All Neko NFTs minted above 0.4 ETH will be tracked using their Unique IDs to be used for the Character Vessel Core Raffle. This means that if you sold your NEKO NFT which you minted at or above 0.4 ETH, the current owner of that NEKO NFT is eligible to take part in the Raffle, not you.

Update on NEKO Whitelist: Private Sale

We have identified some potential pitfalls from having two active prices during the Dutch Auction, and we want to ensure that we promote a natural price discovery together with leveling out the mint transactions over the Dutch Auction. As such, we have decided that if you have been whitelisted for the NEKO Mint, instead of a pre-sale allocation, you will now be eligible for a private sale allocation, which will be conducted after the Dutch Auction but before the reveal, at a reserved price of 0.1 ETH per NFT. You will have approximately 1 day to mint, meaning that you can mint at your own time and at gas prices you are comfortable with paying. We believe that you rightfully deserve this based on all of your contributions!

Further details about the reason for the private sale are included in the section below.

How do we plan to Improve on the Existing Dutch Auction Model?

The NFT space is ever evolving and we strongly believe that we can glean important lessons from other projects. Although we believe that Project X did achieve its overall goal of reducing the gas paid by its community members throughout their sale, they still felt that with a few adjustments, a Dutch Auction could truly be implemented effectively to the benefit of the community members.

After considering the amount of time and resources needed to implement, and the various sale options available to us to address gas-related issues (while having to balance the possible avenues for abuse of those options) we too have come to have the same opinion as the team of Project X. However, we are proposing a change which we believe should address concerns regarding some of the issues experienced by Project X at the tail end of the Dutch Auction.

Concern: Project X had a model whereby there were ~1,000 pre-sale NFTs made available for trade before the Dutch Auction. Unfortunately, this caused a complication whereby there were two effective purchase prices (one on OpenSea, and another on the Dutch Auction). As the Dutch Auction progressed, more and more NFT owners tried to undercut the Dutch Auction's listing price (either out of price manipulation or fear), which created a self-destructive cycle where the only 'logical' option for community members was to try and wait for lower prices on the Dutch Auction, which largely contributed to the gas spike at the tail end of the sale, even though the effective average buy-in price of the NFTs after gas costs was still around 0.2 ETH.

How we Plan to Address this Concern: In order to avoid a dual purchase price situation which will likely precipitate the same situation, Sipher will instead be converting our Pre-sale to a post-auction but pre-reveal Private Sale, as mentioned previously. We believe that this will:

  1. Allow the Dutch Auction to more naturally discover the fair price of the NEKO NFTs (free of possible price manipulation via a secondary purchase price on OpenSea).
  2. Allow a situation where Mint Transactions are more evenly spread out over the duration of the Dutch Auction.
  3. Provide our Whitelisted Community Members the optionality to decide whether they wish to proceed with Minting using their Private Sale Slots or to forgo it, after accessing the outcome of the Dutch Auction.

Closing Remarks

We hope that this article, in one way or another, helps those of you who want to participate in the Dutch Auction to mint some NEKOs. Additionally, we are excited about the opportunities that this may bring - being one of the primary funding sources for our Community Wallet, this opens up many doors of possibilities in how we will continue to expand as a community. Please refer to the following page for further details about our Nexus Expansion Program