DeFi Lesson 2- NFTS, PTE (Play to Earn) and the Metaverse.

DeFi Lesson 2- NFTS, PTE (Play to Earn) and the Metaverse.

By vanassen.eth | understandingadoption | 12 Dec 2022


 

      Although the crypto market has lost almost 2 trillion in liquidity in the past year, the popularity and shear number of users/ community members in gaming and NFTS has only grown in the past year. This shows that it's not so much the traditional investment community, which has had big liquidity to pump digital assets in the past. The NFT world is now largely inhabited by users and gamers. 

    With the active number of crypto wallets at any given time vs. the amount of gamers in the world today, it's a no brainer that this sector could lead the digital asset revival. 

   Illustrative, PFPs, memes/ derivatives, on chain generative art, are just a few examples of the forms that NFTs have taken over the past 2 years.  

   P2E offers a utility for NFTS other than just subjective art or community enjoyment/participation, and even brings market and DeFi aspects into gaming. This is nothing new, gamers will know that secondary markets have existed for gaming since the conception of online gaming. Even MT. GOX, the OG BTC exchange, was originally a gaming exchange for Magic the Gathering. MT. GOX = Magic The Gathering Online Exchange.

   Great examples of p2E games hold the original tenets of digital assets- the community isn't maintained by a centralized entity, but rather, by the community itself- the community members themselves are rewarded for participating and maintaining their own community. 

 DeFi Kingdom is a RPG p2E game that was originally on the Harmony Chain that uses DeFi elements from SushiSwap- essentially players can collect resources in the game and swap them for JEWEL, the DeFi Kingdoms digital asset. 

    If we consider that all of the DeFi development that sustained the latest bullrun was created in the previous crypto winter; quintessential d'apps like Uniswap, Bancor, and the likes were all produced after the original ICO bullrun/ bubble. 

   Where we are now is similar; much of the development happening right now during price tanking is focused on NFTS, p2E, and metaverse; and this TVL and innovation will lead us into the next bull, whenever that may be. More than bringing asset prices back up, we should consider how the innovation from the last crypto winter completely changed the landscape of the ecosystem by bringing so many new applications- how will this current winter affect the landscape of the future ecosystem of the next few years.

 

  Factors for purchasing quality NFTs-    

  - Look at the ratio of tokens in a collection which are posted for sale vs total amount. For instance, on Opensea, when visiting a 10k collection, see how many of those are being sold on Buy Now, vs the ones being hodled and bid one. If 1,500 tokens out of a 10k collection are up sale near the floor price, the floor is certain to break.

 On the flip side, if only a handful to none of the tokens in a collection are being offered up for sale, the floor price collecion will naturally rise as more and more users bid higher and higher on obtaining some of the scarcity. 10% on Buy Now is a good rule to stay under. 

Context is an oracle analytic app that tracks sales of tokens and activities of token holders, to try to gain perspective on good possible buys. It works like a social media feed app. 

 Much like ERC-20 tokens provided the way for DeFi and a change to our financial structure, ERC-721 tokens changed the social landscape- remember, in their most basic aspect, NFTs are a community pass, a token gate to a community that otherwise wouldn't be accessible. 

 Additional tips: 1. Learn how to track wash trading.

                          2. Understand tokenomics

                          3. Have a system in place for detecting value- you won't win every time, but having a working system will certainly set you in the right direction. 

                          4. Use the blockchain and available analytic and oracle tools to track what other people are buying, and what else they have in their collections, what traits the winners are looking for, etc.

           

                               NFTS have been used the past year as a hedge against the falling price of ETH. As ETH falls, floors are swept and prices are raised and sold, giving the hedger a greater amount of ETH, which will eventually equal a greater value at the end of this winter.                 

  Consider buying a PokeGan NFT.

  You'll gain so much more than the basic outlines here. 

  Tokengated lessons provided by Omakasea. 

  Follow me on Lens and Twitter. 

 

 

     

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vanassen.eth
vanassen.eth

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understandingadoption
understandingadoption

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