4 hours ago
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Part 1 of a 4-part series on the latest ERC-721 innovation
The Next Generation of NFT
Traditional NFTs lack inherent value. Unless tied to utility or revenue-sharing mechanisms, their worth is dictated solely by what someone else is willing to pay.
Please note this article is intended for informational purposes only. All views and opinions expressed are my own, and should not be considered financial advice, nor considered the views and opinions of the Liquid NFT Marketplace. Always do your own research, and consult with a financial advisor before making any investment decisions.
For the uninitiated, An NFT, or non-fungible token, is a unique digital asset that represents ownership or proof of authenticity of a specific item. Typically it exists on a blockchain. Essentially, it’s a crypto collectible that represents items such as art, music, video game components, and videos.
Non-fungible tokens (NFTs) use what is known as an ERC standard to define how NFTs are created, owned, and transferred on a blockchain. ERC is an acronym for “Ethereum Request for Comment”. It is a technical standard used on the Ethereum blockchain, primarily for defining smart contracts and tokens.
Introduced in 2017, the ERC-721 standard is used for creating NFTs.
Liquid NFTs redefine the NFT landscape by embedding liquidity into every minted token. When a Liquid NFT is created, 50% of its mint price is locked in $USDC, giving it an intrinsic value independent of market demand. Unlike traditional NFTs, whose value depends solely on buyer interest, Liquid NFTs guarantee a baseline worth.
The locked liquidity isn’t static. It increases over time through marketplace activity. Liquid NFT holders can do one of three things at any point.
They can either:
- Sell their NFT
- Redeem their NFT. This destroys their NFT, but allows them to redeem the liquidity, ensuring their investment always retains a tangible value
- Burn their NFT. Which also destroys their NFT. However, instead of the holder receiving the locked liquidity, the liquidity gets redistributed amongst the liquidity of the existing NFTs in the collection
This groundbreaking concept and its accompanying marketplace are the brainchild of Nathan Hill, a visionary who sought to address the inefficiencies of the current NFT ecosystem.
The existing NFT paradigm is fundamentally flawed, with downward price trends being the norm. Sellers are forced to undercut each other to attract buyers, leading to perpetual devaluation. For instance, even high-profile collections like the Bored Ape Yacht Club have seen their prices steadily decline since their peak in 2021.
Traditional NFTs lack inherent value. Unless tied to utility or revenue-sharing mechanisms, their worth is dictated solely by what someone else is willing to pay. Even in cases where revenue sharing exists, it depends on platform profitability, which is never guaranteed.
Traditional NFT creators face diminishing returns. After the initial mint, their income relies on secondary sales, which decrease in value over time due to price depreciation. This creates little incentive for creators to support their projects post-launch.
The Liquid NFT Marketplace flips this flawed model on its head by embedding liquidity directly into each NFT. As mentioned previously, when minted, 50% of the price is locked in $USDC, effectively setting a minimum floor price for the NFT.
Of the remaining 50% of the sale price:
- 40% goes to the collection creator
- 10% goes to the Liquid NFT platform, half of which is redistributed to increase the liquidity of other NFTs in the collection
Here’s how it works:
- The liquidity is controlled solely by the NFT holder, immune to external manipulation
- Locked liquidity grows over time through marketplace fees and activity
- Holders can either redeem, or burn their NFTs. This either returns the locked liquidity to its holder, guaranteeing a return on investment. Or it redistributes the liquidity amongst the liquidity of the rest of the existing collection
Every secondary sale trade on the Liquid NFT Marketplace generates fees:
- 10% goes to the creator, ensuring ongoing rewards
- 10% goes to the platform, half of which is redistributed to increase the liquidity of other NFTs in the collection
This creates a perpetual upward price trajectory, where the value of Liquid NFTs continually appreciates.
Liquid NFTs eliminate the race-to-the-bottom pricing of traditional NFTs. Since their intrinsic liquidity value always trends upwards, holders have no incentive to sell below that price. Buyers, recognising this dynamic, are encouraged to offer more for these appreciating assets.
In bull markets, Liquid NFTs rise rapidly. In bear markets, their value still grows, albeit at a slower pace. This ensures consistent upward momentum of the NFT’s price action.
Even burning a Liquid NFT feeds into the ecosystem by redistributing liquidity to other NFTs in the collection, further boosting their value.
Liquid NFTs represent the evolution of blockchain collectibles: a system where everyone benefits. This includes the creators, holders, and even the marketplace itself.
Key benefits include:
- Guaranteed minimum value through locked liquidity
- Sustainable income for creators via growing secondary sale fees
- A market-proof model that ensures value appreciation
The Liquid NFT Marketplace even simplifies the buying process.
Interested buyers can directly communicate with existing holders to negotiate purchases, fostering a more dynamic and efficient marketplace.
Discover the Liquid NFT Marketplace, a revolutionary platform redefining the NFT ecosystem.
- Website: liquidnfts.finance
- Telegram: liquidnftTG
- Twitter: @liquidnftmarket
- Creator: Nathan Hill (Crypto Magazine)
- Connect with Nathan on LinkedIn
Nathan Hill is a visionary leader who combines brilliance with integrity. Under his guidance, Liquid NFTs are transforming how digital assets are valued and traded.
Don’t miss your chance to join this pioneering movement.
“If it’s not Liquid, it’s not worth it.” — Nathan Hill
My name is Prometheus Bones, and I’m an ambassador for the Liquid NFT Marketplace.
Any project creators who are interested in launching their collections as a Liquid NFT, please feel free to use my referral code to do so.
It will help me out greatly, and allow me to continue doing the work that I love in the Web3 space.
For my referral use the URL (link) below.
https://liquidnfts.finance/share/0xca6d817199d4bd248a53a24e17731bb8c84dab88
Also, if crypto is your thing, you are more than welcome to follow me on X (Twitter).
I am a Bitcoin Maxi, and I post quite regularly.
Many thanks.
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