Author/Interview: LeftOfCenter
Interviewee: Cao Yin, managing director of Digital Renaissance Foundation
This article was jointly launched by Lianwen and Star Mining Technology, which is a subsidiary of A-share listed company IMS (World Show).
The deficient DeFi boom has brought a lot of hot money to open finance. Investors are eager to find the next crypto investment target for this money. Some people predict that NFT is the next investment boom.
As retail investors, we cannot evaluate such judgments, but at least we must understand what NFT is and what possible uses it has before investing. After all, to understand and buy is the basic quality of a value investor.
To this end, A-share listed company IMS (show the world) in its subsidiary Star Mining Technology and chain block chain technology developed jointly smell of NFT’s application to conduct a holistic picture of introduction, NFT old players in the field of digital arts Cao Yin, the managing director of the Renaissance Foundation, also provided great help to this review.
Although it is a holistic perspective, it must be pointed out that one article cannot cover all use cases, not to mention the constant creativity of crypto developers who love tossing, and new things are born every day. But the good news is that with this article in hand, NFT ecology is fully understood.
What is NFT?
Before explaining what NFT is, let’s take a look at what Fungible Token is.
Fungible means homogenization . Homogenization means that one token is not different from another token. Each has the same face value, so they are interchangeable. Similar to the currencies we usually use, the same face value can be interchangeable or Used to buy its goods. For example, a $5 bill can buy a hot dog.
Most cryptocurrencies are homogenized tokens, such as Bitcoin and Ethereum as we know them. Although their prices fluctuate from time to time, the homogenized tokens have the same face value, so they can be used for transactions as general equivalents and have a higher level of liquidity.
The full name of NFT is Non-Fungible Token , which is the opposite of Fungible. Translated as a non-homogeneous token , it means that each one is irreplaceable and unique. Just as there are no two identical leaves in the world, and there are no two exactly the same NFTs in the world, this means that they cannot be exchanged one-to-one , and it is very difficult to trade because of the valuation of each.
The simplest example is that NFTs that represent artworks cannot be exchanged. For example, the portrait of Mona Lisa displayed in the Louvre and the graffiti of children’s hand-painted works will definitely not work, because the value of the two is so different.
Technically, the realization of NFT is to embed a kind of identification information in the smart contract, so that each NFT has a unique ID . This unique attribute makes NFT naturally unsuitable for trading, but it can be an ideal choice for recording and storing digital product ownership including artworks, games, and collectibles.
Intellectual property tokenization
One of the biggest uses of NFT is to use it for intellectual property , such as digital content works such as pictures, videos, blogs, music, and artworks.
This means that when a digital product exists in the form of NFT, you must spend money to buy it. This may be a bit against people’s common sense , and this will lead to questions like, “I’m just going to listen to music directly on the streaming media Spotify. Why do I have to spend money to buy an NFT? For example, I can obviously Google and download The high-definition picture, and then set it as a computer screen saver, without spending a penny, why should I spend $30,000 to buy an NFT artwork?”
It can be said that the above question is the biggest misunderstanding of NFT.
Because a picture NFT is not the same as a picture, but the permission of the picture. Therefore, when I purchase a knowledge product in the form of an NFT, I purchase a specific right to own the work. For example, when you purchase a music NFT, the purchase is actually from a 7-digit sales album The right to receive royalties. In the application of knowledge products, NFT is essentially a kind of content permission .
Content licensing rights include the following basic rights : ownership and retention rights, sale and lending rights, franchise rights and re-use rights. The unique attributes of NFT determine that the assets represented by NFT are scarce , so they can carry unique value and cannot be tampered with, copied or replaced. This feature is very suitable for applying NFTs to digital content products, that is, creators can divide a work of multiple different rights into multiple NFTs and then sell them.
If this kind of licensing is widely used, it will disrupt the digital creative economy .
Application of NFT in the art industry
Speaking of the application of NFT in the field of intellectual property, the art industry is of course the first to bear the brunt.
So far, most encrypted projects are nothing more than the reproduction of human behavior in encrypted versions. From markets, transactions, lending to speculation, the art industry is certainly no exception. The traditional art market that has been formed hundreds of years ago has a relatively complete industrial chain, and the application and exploration of the financialization of art assets has a good practical basis, which makes it possible to intervene in the traditional art market in the form of encrypted finance.
On the other hand, the DeFi mining boom that started this year has brought a lot of hot money to open finance . Investors need to invest these DeFi proceeds in new targets, which in turn will heat up the NFT market.
According to the NFT market report released by DappRadar , in September, the transaction volume of the NFT market surged by 1127%, breaking through 7 million U.S. dollars . Among them, the transaction volume of the NFT digital collection and trading platform Rarible accounted for up to 81% (about 5.5 million U.S. dollars).
NFT has been able to market Rarible so popular, that the NFT liquidity facility in July to start by “market liquidity mining” (Marketplace Liquidity Mining) mechanism will be 60% of the total supply of governance RARI tokens to users, As long as there are NFT token purchases and sales behaviors, they can be based on the same share of governance token RARI every week, that is to say, miners will be on the Rarible market according to users every week (https://app.rarible.com/) RARI tokens will be obtained for purchases and sales. In addition, Rarible also distributes 10% of the total supply of tokens to all NFT holders by way of airdrop, which is not limited to the purchase platform.
Such a radical incentive behavior, although it makes Rarible’s data very attractive, the wash trading that occurs on the platform has become a problem. Although Rarible later introduced a platform fee mechanism to eliminate the wash trade behavior, this may not be the most effective solution.
It is true that many shoddy NFT works have emerged under the cliché that ” everyone is an artist “, as well as a series of problems such as transaction cleansing and speculation, but a series of interesting NFT projects are still clearly visible after the mist of fish and dragons is cleared. By interpreting these cases, we can get a glimpse of the characteristics, potential and usability of NFT.
One work: Right Place – Right Time
The NFT artwork ” Right Place – Right Time ” comes from artist Matt Kane. This is a dynamic work with Bitcoin as the theme. The author has implanted a BTC price feed algorithm in it . The NFT will be updated every 12 hours. The price of BTC changes, which means that the pattern of the work will change based on the volatility of Bitcoin price. In addition, every time the price of BTC breaks through a key node (for example, when the price of BTC exceeds $20,000), the NFT will automatically mint and sell a new NFT, limited to 210 pieces, and buyers are eligible to apply for a corresponding NFT printed version. It can be said that these works record the price history of BTC in the form of NFT cards and have certain collection value.
This piece has been TokenAngels at a price of nearly $ 100,000 to buy on Async Art platform, however, only 21% of the sale proceeds right that each new generation and 21% of the proceeds of sale of the NFT will go TokenAngels, The rest is retained by the original author Matt Kane. That is to say, NFT is sold as a self-defined proportion of income and equity certificates , allowing the original author to retain part of the economic income rights. At the same time, the creator also has the right to fine-tune the work. Even after the work is sold, the artist has the right to perform modify.
DeFi community pilot project MEME for NFT mining
MEME is another project worth mentioning. It was initially popular due to the DeFi community culture , but has now begun to transform into NFT artwork.
MEME originated from a satirical joke. Its founder Jordan Lyall was initially disgusted by various meme projects such as sushi and kimchi. He posted a tweet saying that it would take 5 minutes to start a fictitious DeFi project ” The Degenerator “. This is an irony of those DeFi MEME projects on the market that went online in a short time.
Unexpectedly, this tweet caused a enthusiastic response, and then someone really minted the token MEME and spontaneously formed a community. After the fair airdrop, combined with the NFT scarcity mining, it caused considerable market enthusiasm.
The enthusiasm of MEME is inseparable from the scarcity of NFT mining. The NFT cards released by MEME record all kinds of MEME stalks that have actually occurred in Amber. If you are an “old man”, you can’t help but smile after reading it.
The irony of the card on the left of the picture above is that the ” Ao Ben Satoshi ” who pretends to be Satoshi Nakamoto is often mocked and despised by people in the Bitcoin community. The card on the right describes the blood relationship between Sushi founder Chef Nomi and FTX founder SAM .
This is the Hayden Adams series, the founder of Uniswap, with common, rare and legendary cards on the left, middle and right. In the ordinary card on the left, the line in the card is “Giving them free money, and grab them back slowly – that’s how we grow as DEXs” [Giving them money (make friends), and then slowly cut back, this is what we do The way DEX develops] is obviously a satire on Uniswap’s generous airdrop incident. In the rare card in the middle, the line in the card is the buzzword “Few understand this” in the DeFi circle, which few people know. In the legend card on the right, Hayden Adams himself is riding a unicorn symbolizing Uniswap , smiling at the destroyed sushi in the upper right corner.
These spoof-themed NFTs are distributed in MEME’s NFT card mining pool. According to the rules, pledge 1 MEME token to get 1 pineapple point (up to 5 MEME tokens can be pledged in a day), and collect a certain amount The number of pineapple points can be exchanged for specific NFT cards in the pool.
The supply of different cards and the pineapple points required for redemption vary according to their scarcity. Among them, the legendary cards belonging to the ” Genesis-LP ” pool have the least issuance, each with only 10, which requires pineapple points Also the most, 75.
There are a number of different NFT pools on MEME. In addition to the first two creation pools, there is also an event pool and the first artist pool newly opened.
In the “Genesis-LP” farming pool, one of the creation pools, most of them are legendary cards. There are some legendary amber gods on the card surface. The scarcity is high. There are only 10 each , and they are currently sold out.
The situation in the ordinary pool is more complicated. Some cards are very popular and sold out early. Investors can go to OpenSea to continue buying.
The MEME, which is full of DeFi stalk culture and strategic game mining , attracted many users to join. MEME quickly became popular. With that, the tokens went up. Just less than 24 hours after the project was released, the tokens The daily trading volume reached 1 million U.S. dollars, and the token price was as high as 40 U.S. dollars. The highest peak reached 1807 U.S. dollars. It is currently maintained at 312 U.S. dollars and the market value is 6.7 million U.S. dollars .
Of course, some people think that MEME’s model is unsustainable, and it is only temporary. In response to these doubts, MEME plans to introduce more artists to jointly create more sustainable long-term value.
The first batch of artists introduced is the pineapple-themed set of digital works “SVEN x $MEME 🍍 Series” created by digital artist Sven Eberwein , which is full of meaning and very interesting.
Sven Eberwein is a digital artist living in Los Angeles. He is good at computer graphics, Internet culture and memetics. There are 4 works in the pool. The supply of each work and the points required for redemption will vary according to the rarity. , The most rare work ” Don’t buy $MEME ” has a supply of 500 pieces and requires 10 points. The most rare “🍍Crashtest (Because it will)” has a supply of only 10 pieces and requires 60 points. One.
Sven Eberwein also launched an auction of works on the MEME platform. The work is called “Pineapple Ponzi”. There is only one piece. The auction was finally purchased with 88 MEME tokens, of which 10% of the proceeds were donated. To charity.
We look forward to seeing more artists enter the MEME platform to create sustainable long-term value. It is worth noting that the artist in the next issue will most likely be an anonymous artist Pak .
Sven Eberwein tweeted that the next artist to take over is Pak
Who is Pak? Chain Wen has previously reported on this artist. He is the founder of the internationally renowned Undream studio and the art AI public account Archillect (over 2 million followers on Twitter). He has been engaged in digital art creation for more than 25 years and has worked with hundreds of artists. Big brands cooperate with studios. Since the sale of his first work ” Cloud Monument Dark ” in February this year, Pak has made hundreds of thousands of dollars through digital works. Among them, the artwork with the highest transaction price was called Terminus. After more than 5 hours of competition between digital art collectors Eric Young and WhaleShark, it finally reached a record transaction price of 138.5 ETH, which was approximately 53,000 US dollars at the time. .
NFT Art Market SuperRare
Founded in 2017, SuperRare is an NFT art market that can collect and trade digital art. Every art on the platform is tokenized based on the image hosted on it, and then displayed in the creator’s personal profile. The platform supports a wide range of artworks, in addition to conventional works, it also includes programming art and dynamic artworks. There is a certain threshold for artists to enter, and they can only join after passing the application. Adding a screening mechanism can filter the quality of the works to a certain extent.
Artists stationed on the platform can get 85% of the income from the first sale of their works, and the remaining 15% of the income will be used as a commission for the platform. In addition, SuperRare permanently retains 10% of the artist’s work income, which means that even if the artist has already sold his work, he can still receive 10% of passive income from each secondary market sale, similar to royalties.
This is a feature that is very friendly to artists and also attracts a large number of artists. Because in traditional art collections, once the art is sold, you can no longer profit from your early works.
The bottleneck of NFT art market landing
However, in actual use, there are still a series of problems in the implementation of NFT in the art industry.
Liquidity conundrum
First of all, the scarcity represented by the non-homogeneity of NFT is suitable for a series of applications that embody unique value, but it is also because of its uniqueness that makes it difficult to evaluate the value , which makes it difficult to realize the free trading of NFT artworks and generate flow issues, in fact, liquidity problems to be solved NFT is considered one of the most pressing problems.
For this reason, a series of novel NFT liquidity solutions have emerged, such as the fragmentation solution NIFTEX , and NFT mining solutions such as Whale and Rarible .
Among them, the self-service NFT liquidity solution NIFTEX allows users to split an NFT into several fragmented tokens in the ERC20 format, which can be traded and exchanged on the open market, thereby unlocking liquidity for the unique NFT.
This allows ordinary people to actively participate in the investment of encrypted digital art. If you want to own a complete NFT artwork, you need to invest more cost. The logic of the buyout clause is implemented in NIFTEX. For example, if someone wants to present A complete NFT can be quoted to buy out 100% of the shard tokens . Once the offer is accepted by all holders, the remaining shard tokens can be guaranteed to recover the NFT. However, if the offer is not accepted, the shard tokens owned by the offerer can be bought by others at the offer.
For an encrypted ecosystem, the most important thing is that its token mechanism can promote the organic growth of the community. As far as NIFTEX is concerned, the creator of NFT is the core of the entire community. Therefore, only a set of sustainable development can be derived from this core role. The mechanism of this project can fundamentally sustain a prosperous NFT market, promote the production of more excellent NFT works, and make the community rejuvenate for a long time.
To this end, NIFTEX has launched a royalty reservation function that is friendly to the core role ” artist ” in the community. After the fragmented tokens are processed, the system will automatically reserve 5% of the total supply of fragmented tokens for creators, which means Therefore, even if creators no longer own their own NFT works, they can still benefit from the secondary market trading of fragmented tokens. The greater the transaction volume of shard tokens in the secondary market, the higher the token price. At this time, creators can capture the upward premium by selling the 5% reserved shard tokens. At the market level, based on the NFT after the NIFTEX split, every time it is resold in a market that supports royalty sharing, part of the proceeds will be distributed to the creator.
This means that if a certain NFT work is popular in the market, its author can effectively capture its upside value and encourage more creators to join the platform.
Insufficient infrastructure in the early days of the industry
Encryption art is at an early stage and has the problem of insufficient infrastructure.
Cao Yin , the managing director of the Digital Renaissance Foundation, believes that in the traditional art industry, there is a complete ecology, such as galleries, auction houses, art brokers, and specialized art critics and academic art researchers. , Art critics have formed a complete ecology , and art collectors are the end of the art market in this ecology.
In the current encrypted art or NFT ecosystem, there is no systematic, very frequent interaction, and healthy ecology like the traditional art market. Currently, the encrypted art industry lacks ecology , and there are only a few art transactions like OpenSea Platform, Superare and Makerplace are specialized primary issuance and secondary auction platforms.
But these infrastructures alone are far from enough, not to mention that the experience on these platforms is very bad now . Take OpenSea as an example. There are various NFTs on it, such as NFT artwork, encrypted game asset props, skins, and ENS domain names. This is a bit like the early Alibaba. Everything is piled up, but each category The assets and the corresponding user portraits are completely different. This is actually a manifestation of the early chaotic state of the market. The reason for this is that the early market is still immature. In the future, there will be a dedicated digital art aggregation platform, which will place the artworks on platforms such as Known Origin and Superare. Together for secondary market display and trading, there is also a dedicated game asset trading platform like SpiderDEX .
Therefore, as the industry matures in the future, the entire NFT market will be vertical . The industry division is very clear. There are specialized NFT galleries, specialized NFT secondary matching trading platforms, specialized NFT replacement platforms, and specialized NFT critics and policymakers. Exhibitors.
The circle is too small, not enough artists
In addition, the size and scale of the NFT art industry is still small , and it needs to be out of the circle.
Encrypted art is still in its early stages. Most of the participants are people in the original cryptocurrency industry. The main body of digital art transactions or investment is not a typical group of art collectors. In other words, whether it is an artist or a collector, the base is very small. If you want to grow, you need to be out of the circle.
Cao Yin said that from this perspective, “NFT is not that digital art is needed, but digital art requires NFT.” Digital art NFTs are familiar to art collectors and have a huge space in the art market.
Whether it is the NFT art market like SuperRare or the liquidity solution like NIFTEX, it provides a friendly solution for the core figure in the entire ecology, that is, the creator of the work, that is, allowing the creator to retain part of the right to profit from his own work , Even after many years of selling, you can still get objective income due to the increase in the value of your works. For example, SuperRare permanently reserves 10% of the secondary income right for artists.
Such a policy is especially critical for attracting artists. In the traditional art industry, once the artwork is sold, you can no longer profit from your earlier works.
Pak also holds the same view. TA (we don’t know Pak’s gender) believes that “encrypted digital art has not touched “outside the circle” and the main obstacle is expansion . “
In addition, as far as art collectors are concerned, Hashii Art , the solution provided by StarMining Technology, has introduced a new type of encrypted art investment and management rights for traditional Chinese art collectors, appreciators and creators who were originally insulated from encrypted currencies. It is also a very good opportunity to get out of the lap for NFT. The specific method is to digitize the artwork first, and then use special hardware equipment to enable the NFT artwork to be displayed in the physical space. Cao Yin said that this is very scarce at present, and it provides a very rare opportunity for encrypted art and NFT to get out of the circle. Otherwise, encrypted art is limited to a small circle such as encrypted amber and cannot be expanded.
Hashii Art is composed of Hashii Art OS (operating system), ARTLOOP Box (intelligent hardware), and “Art Loop” (small program). It integrates smart hardware, operating system, and small program into one, aiming to decentralize Ways to solve the problems of credit and value distribution in the preservation and circulation of artworks.
An interesting case is that the paintings of the new pants band Peng Lei completed an online transaction on the art circle Art Loop , becoming the world’s first piece of art successfully traded on the blockchain. The work will be recorded on the global blockchain. Anyone who wants to buy the painting can retrieve it on the blockchain. The value and inheritance of the painting will be further verified. Every purchaser does not need to worry about forgery. .
Trade washing and market manipulation
As we mentioned before, the short time by the rise of liquidity mining Rarible questioned whitewash (wash trading).
In fact, Rarible co-founder Alexander Salnikov also admitted that approximately 40% of Rarible’s August NFT transactions totaling $750,000 involved some sort of wash trade. This means that these seemingly bright trading volumes are all brushed out.
As a form of market manipulation , wash trading refers to the fact that traders create the illusion of high liquidity in the market by buying and selling the same digital asset at the same time. Imagine that a certain NFT whale buys an encrypted artwork for US$10,000, then sells it to a friend for US$25,000, buys it back for US$50,000, and then sells it to US$100,000. How easy it will be for unsuspecting speculators.
As the best indicator to measure market sentiment and an important indicator that reflects the strength of exchanges, trading volume cleansing is widespread in the crypto industry, whether it is exchanges or NFT trading markets.
Cross-platform verification
Generally speaking, an artist will create multiple different versions of a work of art, so once the value of the work appreciates in the future, he can benefit from the reserved one. On digital art platforms like SuperRare, the verifiable feature of the blockchain ensures that all versions of the artist’s works are unique and there is only one piece.
However, this feature is only valid when it occurs on the same platform. Once it is cross-platform , there may still be problems where the same work is submitted multiple times by people who are ill-intentioned .
For example, some creators reported to the Rarible platform that their works cast on SuperRare a few months ago were reposted to Rarible and sold at a price of $3,000. The report was verified and accepted by the platform, and the work has now been removed.
Why does the art market need NFT?
So, what we want to ask is, what advantages does NFT bring to the art market, so that we believe that the application of NFT in the art industry is so huge and has great potential. In other words, why does digital art need NFT?
fluidity
Compared with traditional artworks, encrypted digital artworks are more fluid .
For example, collectors do not need to deal with cumbersome details such as mailing and transportation like traditional art transactions. They only need to confirm on the blockchain. In addition, the transaction can be confirmed directly on the blockchain after the transaction, keeping records forever , It cannot be tampered with and can be traced back, so there is no remorse after the transaction.
Divisible characteristics
NFT has the feature of divisible, which can greatly develop the potential of NFT.
Whether it is the fragmented fluidity project we mentioned earlier, NIFTEX, or First Supper, a platform that can sell artworks in layers (First Supper can divide works into main layers and sub-layers. In contrast, ordinary oil paintings cannot Separately pull out the next layer for sale), or sell part of the income rights of the artwork like “Right Place-Right Time”, which can bring greater possibilities to the art market, not only the asset types are more diverse Globalization has also made art collection more democratized, making small investments possible and no longer limited to high-net-worth investments.
However, whether it is the traditional art market or the encrypted art industry, the price of a complete work will always have a certain premium compared with the sum of the value of a single piece.
Economic premium, so ordinary people can participate
In the past, art collectors who invested in art were concentrated in high-net-worth investors and were monopolized by large-scale investors. In addition, there was a certain threshold to determine the value of an artwork. Web3-based encrypted artwork has financial attributes since its inception. The value is clearly visible.
Compared to before, if you are not interested in digital art, you may be insulated from art investment, because valuation is a relatively threshold thing, and whether it can be sold well after success is risky.
Blockchain-based NFT digital artwork can be customized to be cut and fragmented, born for value, and form value through the market, and there are various liquidity solutions. In this way, art investment can be expanded to more Many ordinary people, even those who cannot understand the work, can still participate through purely economic investment .
Other industries and applications
The above has introduced the application of NFT in the art industry, but this is not all. As a new encryption primitive, NFT shows its potential not only in the art industry, but also in a series of other application scenarios.
Blockchain pet development game
Encryption pet raising game Cat (CryptoKitties) NFT is a game, encryption is ⼀ likeable cat meow digital microphone, every NFT cats have only ⼀ ⽆ character of the two genes, and thus determine its appearance and character. Players can collect and breed cats, create new cats and unlock scarce attributes. Encryption cats multiply so far, already has close to two million different styles of cats, nearly 90,000 addresses own at least one cat encryption, the market turnover of about 700,000, worth 60,000 ETH. CryptoKitties became the first phenomenon-level DApp , proving that cryptocurrencies have other practical uses besides speculation.
DeFi mortgage + strategy game + DAO + NFT
Aavegotchi is an NFT platform that integrates DeFi mortgages, strategy games, and DAOs. It originated in the Aave lending ecosystem and is the first NFT project based on the aToken loan asset in the ecosystem.
Aavegotchi represents an NFT card, which represents a ” little ghost ” image. To obtain an NFT image, two conditions must be met. One is linked to the “asset certificate” in the Aave ecosystem, based on the ERC20 mortgage on the Aave platform The asset ” aToken ” generates NFT, whose face value is equal to the sum of the real-time Aavegotchi collateral value and interest; on the other hand, it is necessary to purchase the governance token GHST in Aavegotchi to unlock the access to the portal. This means that this NFT carries a certain endogenous value from the beginning, which is the amount of Aave mortgage assets and the GHST tokens spent on access.
Aavegotchi uses a strategy game, namely scarcity mining . Scarcity refers to the scarcity of a certain NFT trait. The smaller the number of this trait in Aavegotchi, the greater the value, and more GHST token rewards can be obtained.
Unlike ordinary liquid mining, Aavegotchi scarcity mining combines multiple elements such as games, equipment, and rare qualities, which will make players feel more interesting.
The factors that affect the scarcity of certain traits include active participation in community voting, efforts to upgrade the level, and possession of certain specific equipment, and these behaviors influence each other. For example, participating in community voting can increase the level, and then increase the courage value to obtain a certain item Traits; or, acquiring a certain trait to have a set of equipment, which in turn can increase or decrease certain traits of Aavegotchi. For example, an equipment sword may improve Aavegotchi’s offensive ability ; of course, you can also increase The order of collateral and the use of GHST tokens to purchase equipment in order to obtain a certain scarce trait and obtain GHST token rewards.
Aavegotchi adopts decentralized governance and AavegotchiDAO manages funds. As a governance token, users need to hold GHST to be eligible to participate in community governance, vote on future upgrades of the community, vote on new collateral, update game mechanisms, and may even limit the future supply of Aavegotchi. But GHST tokens are not the only condition for participating in governance. Another condition is that an Aavegotchi NFT status is also required.
Here, NFT can be regarded as a key to unlock the rights of community participation . Only having the Aavegotchi NFT card means possessing a certain identity and rights.
In this case, an NFT Aavegotchi not only carries its endogenous value through asset proof (generated based on the borrowed asset aToken in the Aave ecosystem), it also actively adopts a series of operations such as scarcity mining and gamification strategies (proof of work). Upgrade to accumulate more value for yourself. These values can be deposited on this unique NFT card image. In addition to the quantifiable face value, there are also unique individual characteristics (scarcity), which are based on scarcity. It can be converted into economic value-rewards. At the same time, NFTs that have accumulated to a certain face value and have certain unique attributes will naturally bind a series of community rights, such as becoming an indispensable condition for governance and participation.
NFT is like a key, which unlocks a certain access right. In the strategy game of encrypted economy, this key represents achievement value . Unlike other types of assets, the value of the key itself is not so easy to quantify, it depends on the value of what you want to unlock. For the unlocker, once there is a strong need to unlock a certain right, this means that the key is of great value.
More diversified media
In terms of media form, NFT can also apply other more forms, such as sound works .
Daorecords, a record brand in the form of a decentralized autonomous organization, supports the creation of a sound format NFT. And there is also an audiovisual artwork like Elephant Dreams , Elephant Dreams , which was created by Andrés Reisinger and Grammy Award winner DJ RAC . It was auctioned by collector maxstealth for 70 ETH on the encrypted art market SuperRare, which is equivalent to US$26,187 .
Application of NFT in insurance
Since every insurance policy is accompanied by a unique insurance policy for the insurer, this is very suitable for tokenizing the policy using NFT.
For example, year’s founder Andre Cronje once launched a decentralized insurance service, yinsure.finance . This insurance does not require KYC/AML and is underwritten by Nexus Mutual. The policy will be tokenized based on the NFT format.
In addition, NFT policy model natural fit digital art industry, Imagine, develop a policy for the policy work of art, the work is lost once the private key can be obtained after the claims.
NFT prediction market
On Reality Cards , the NFT prediction market platform, the positive and negative results of each prediction event will generate two NFT cards. Participants will “betting” on the results by bidding. Each result can be owned by multiple people for a number of days. Biden, who bet on the 2020 US general election, will win, then pay a 10% premium bid to obtain the NFT from the current owner, and then the next bidder can also bid for the user’s NFT at a 10% premium. Until the end of the campaign, the NFT can be changed hands and held briefly by several people through bidding.
When the result is announced, all participants who once had the NFT representing the correct result will be divided into the bonus pool according to the length of the currency, which means that even if you no longer own the NFT representing the result of the event when the final result occurs, you can still get a part of it The longer the holding time, the more rewards you will get.
On-chain physical assets
Centrifudge is a supply blockchain platform , which is mainly aimed at the supply chain industry with “long payment cycle and large funding gaps in various stages of operation”.
Copyright revenue a loan assets occurred on Centrifudge platform needs through a series of processes, the first step borrower must prove that future revenues will bill payments or data (including bills unpaid, unrecognized or on Spotify streaming media platform Etc.) Transform into NFT through the Centrifuge platform. In this way, the relevant notes representing real assets can obtain a certain value performance. Then, based on the application of Centrifuge, Tinlake over-collateralizes the NFT assets and casts them into two tokens with different risk levels, TIN and DROP. Lend Dai to realize the possibility of obtaining liquid funds based on NFT mortgage.
Issue community tokens based on NFT token assets
NFT can also be used to issue community tokens . After community tokens are issued based on NFT token assets, these community tokens can then be used by community members in the NFT project.
WhaleShark issues community token WHALE with NFT worth one million U.S. dollars as reserve assets. The artist Marguerite de Courcelle, whose pen name is Coin Artist , has issued a token that can be used in the Neon District ecosystem.
NFT bound to participation rights
NFT can be used as an admission voucher for a performance/event, similar to the nature of a ticket . Both DigiTxio and Mintbase support this function.
As a proof of participation NFT, POAP can be used as a badge to distribute conference participants. Only participants can apply for the certification badge, which can motivate more people to participate in the conference.
Wearable equipment combined with cultural surroundings
This use case is suitable for cultural peripherals or fashion brands such as T-shirts and sweaters, and can be linked to virtual games such as Decentraland and Cryptovoxels , and displayed in the game as a digital device.
Each physical product released by MetaFactory is associated with a unique NFT, and a silicon chip is embedded in the product. The chip can track the product’s order number and related metadata, and correspond to a wearable digital version. MetaFactory’s self-published original product double-faced bomber jacket, with an NFT called ” Charged Particles “, with which you can get a digital version of the same clothes shown in Cryptovoxels.
