Research Summary
The report discusses 1155.tech, a new NFT-focused protocol on the Canto blockchain. It aims to address issues such as royalties, liquidity, and distribution that have plagued the NFT market. The protocol uses a bonding curve mechanism to ensure liquidity and fair distribution of fees among creators, key holders, and developers.
Key Takeaways
Addressing NFT Market Issues
- Problem Identification: The report identifies three main issues in the NFT market: royalties, liquidity, and distribution. Royalties have become easy to avoid due to the emergence of alternative NFT trading platforms. Liquidity is a problem in quiet markets, and distribution remains a challenge for artists.
1155.tech’s Solution
- Unique Approach: 1155.tech, a project on the Canto blockchain, aims to solve these issues using a bonding curve mechanism. Users can purchase keys representing different art markets, and these keys can be burned to mint the associated NFT. The process can also work in reverse.
Fee Structure
- Revenue Sharing: The platform has a 9% fee structure, divided equally among the creator, key holders, and core developers. This ensures long-term income for creators, aligns incentives for key holders, and guarantees the economic sustainability of the platform.
Liquidity and Royalty Issues
- Addressing Market Problems: By locking NOTE (Canto’s T-Bill backed unit of account) into the bonding curve while the key is being held, 1155.tech ensures liquidity is always available. The protocol charges buyers/sellers for accessing liquidity. It also addresses the royalty issue by making traders who avoid royalties sacrifice cashflows.
Early Traction
- Initial Success: The report notes that 1155.tech has shown promising early traction, with over $134k NOTE volume traded so far. The team hopes that 1155.tech will become a relevant platform for art distribution.
Actionable Insights
- Monitor 1155.tech’s Progress: Given its innovative approach to solving NFT market issues, stakeholders should keep a close eye on 1155.tech’s development and traction in the market.
- Consider the Implications for the Canto Ecosystem: The success of 1155.tech could be beneficial for the broader Canto ecosystem, providing exogenous demand for NOTE and guaranteeing a positive Net Interest Margin for the Canto Lending Market.
- Assess the Potential for Art Distribution: Artists and collectors should consider the potential of 1155.tech as a platform for art distribution, given its unique approach to addressing the distribution issue in the NFT market.
