I propose that a NFTX pool is set up, and a small treasury amount is used to provide ongoing liquidity. Example - 1ETH / 20 Bears
By adding your NFT to an NFTX vault you mint an ERC-20 token that has a 1:1 claim on a random NFT inside the vault.
Unlike a non-fungible token (NFT), an ERC-20 is fungible (all tokens are the same) and this allows it to be:
- Instantly sold at an AMM (like Sushiswap)
- Pooled in an AMM to earn trading fees
- Used as collateral to borrow stablecoins
Tokens can be used to redeem a random vault NFT at any time.
-Allows a fraction of bear to be purchased.
-Allows bear holders to exit if necessary.
-Allows bear holders to swap their bears for another in the pool.
-Stabilizes price floor. If something is listed very low on opensea, it can be purchased by a user and sold to the NFTX pool (arbitrage trade), raising the OS floor price and increasing volume.
-Another shop window for project exposure.
-Fees earned (paid out in bears) can be used for giveaways/burns etc.
- Impermanent loss may occur in providing liquidity. If price was to rise steeply, liquidity bears would be sold for ETH. If price was to decline steeply, the ETH would be sold for bears.
As a ETH/NFT/DEFI centric DAO I believe this is a step in the right direction and welcome all discussion.