Morning Minute | Composability Comes for NFT Finance

Morning Minute | Composability Comes for NFT Finance

TylerD's Market Summary

Wasabi made a splashy announcement yesterday, launching a new Blur competitor. Find out what happened, plus catch up on the major news from y00ts and DeGods breaking overnight.

๐Ÿ˜ NFT Protocols Embrace Composability

One of the best features of crypto and blockchain is composability.

Composability here means building systems with small independent pieces that can be lifted and shifted and used in different ways and different places. Like lego blocks.

But to date, at least in the NFT finance sector, most protocols have operated in silos with little overlap across marketplaces and platforms other than aggregation.

Well a few new and big players in the NFTFI world are about to change that.

Wasabi Protocol shared major news yesterday that they're launching Liquidity Aggregation, in partnership with lending protocols Zharta and NFTfi.

What Is Liquidity Aggregation?

Wasabi's idea behind Liquidity Aggregation is to match buyers and lenders across the fragmented NFT market.

It's effectively Blur's Buy Now Pay Later (BNPL), but across several marketplaces and with more the lendee gaining more control on repayments and refinancing.

Here's how it works:

  • Wasabi uses lending offers from NFTfi and Zharta
  • They pull in listings from the major marketplaces (OpenSea, LooksRare, etc)
  • And connect listings to lending offers, allowing buyers to purchase NFTs with a fraction of the total funds needed (initiating a loan at time of purchase).

Once the loan is paid off, users have full control of the asset. Or they can use Wasabi's Arbitrage tool to flip the NFT without ever paying it off.

They are currently launching with NFT collections from Art Blocks & CryptoPunks with plans for more.

Why It Matters

First, it's competition for Blur and its BNPL product which was fairly predatory. In many (at least early) cases, lendees would get BNPL loans just to have them called and made repayable within 24 hours, almost always leading to default.

With Wasabi's Liquidity Aggregation, the loans have more clear and set terms that the lendee can see upfront.

At a higher level, this is one of the first major examples we've seen of protocols embracing their composability to integrate cross-platform.

Composability has been a core feature of DeFi for some time now, but has been lacking in NFTs. Now it's being embraced, by one of the biggest players in NFT lending (NFTfi) and two scrappy and innovative newcomers (Zharta and Wasabi).

This is a major step forward for Wasabi and a boon for NFTfi and Zharta as well.

Now attention turns to how this new product is used, plus what else Wasabi may have up their sleeves.

๐Ÿ“ฐ Frank Embraces ETH and Elegancy

August 9th was supposed to be a big day for Frank DeGods, and his NFT projects DeGods and y00ts.

And it seems his announcements came right in line with most expectations (including his delay of the DeGods announcement to 3:30 am ET, technically on the 10th).

Here's what happened.

y00ts Move to ETH

The first announcement came around 5:30 pm ET.

y00ts are bridging again, this time from Polygon to ETH (date still TBD).

The team is also returning its grant funds provided by Polygon as an incentive in the original move, to be "re-deployed for NFT ecosystem growth to empower builders and creators."

The market immediately responded to the news with most seemingly bullish on the new liquidity ETH would provide, and the floor rallied about 15% to 2.1 ETH. 

But apparently some holders got spooked overnight as the floor has fallen to 1.7 ETH, now down 8% on the day and 23% from local top.

Now for the next announcement.

Degods Get Another Art Upgrade

Frank is now aiming for "elegant."

They are adding 20,000 new pieces of art to DeGods without dilution including a new male and female version of each DeGod.

And they're getting rid of the "bad traits."

The market didn't love the news, with the floor falling 5% to 8.4 ETH, though most of that move down took place before the news even came out.

Overall Reactions

Frank shared an interesting quote from Hayao Miyazaki just an hour after the DeGods announcement:

"In order to grow your audience, you must betray their expectations."

He went on to say he's been doing that for 2 years now with no plans to stop.

My interpretation here is Frank saying that he didn't give in to the desire for a "surprise" aspect of the announcement.

In fact he telegraphed this update in his recent tweet storm talking about how tech updates don't move the needle for PFP projects but that holders respond better to simple updates like art fixes. 

And that's what he delivered.

In many ways it was a fastball down the middle.

The migration to ETH of course makes sense and is the right move. It does raise the question of why they didn't move y00ts to ETH when DeGods moved instead of taking this 4.5 month detour, and one can also question how hard they tried to make y00ts on Polygon "work." But ultimately it's the right call.

There is a bigger question here of what this means for Polygon, who can't even pay Frank $3M to keep his NFT on their chain, but I'll save that for another day.

As for the DeGods art upgrade, it's the safe move. Even though they're down 5% and may fall a bit more, this will be no Azuki Elementals-like catastrophe. 

DeGods will keep their #3 PFP spot, at least for the near future.

And that's probably the best outcome on the table, in this market.

๐Ÿšš What else is happening in NFTs?

Here is the list of other notable headlines from the day in NFTs:

  • Trading volume again ticked up to 6.7k ETH on Wednesday; NFTs saw a lot of green led by Milady's, Super Cool World, & Velocity Series
  • DeeKay Motion is dropping a 24-hour open edition on Base starting at noon ET today in partnership with Cozomo de' Medici and Coinbase as the inaugural art drop on the new L2 chain
  • Reboot Protocol announced distribution plans for its 1 billion $GG tokensPOW can be exchanged for 0.41 GG or 41 Game Credits, while $PUNKS can be exchanged for 0.75 GG or 75 Game Credits
  • Artist 0xdgb announced "The Cameras," a new art collection and PFP series, offering collectors the ability to select their preferred artwork from a series of 70 distinct camera (with more to come), through a new dynamic contract with Transient Labs
  • Knights of Degen unveiled its PropQuest beta, an immersive daily player prop game, that offers sports fans a chance to prove their sports prediction skills through daily quests, Game Changer NFTs and more

๐ŸŒŽ Around Crypto and Web3

A few other Crypto and Web3 headlines that caught my eye:

  • The crypto market was down slightly on Wednesday ahead of today's CPI news; BTC -1% at $29,500; ETH -0.5% at $1,850
  • Coinbase officially launched its L2 Base blockchain on Wednesday as the first ever launched by a public company
  • The SEC is appealing the XRP ruling in their case against Ripple by filing an "interlocutory appeal"

๐Ÿš€ NFT Total Volume

  • DeGods (1042 ETH, 8.5 ETH Floor)
  • BAYC (743 ETH, 29.29 ETH)
  • Milady (598 ETH, 4.2 ETH)
  • MAYC (492 ETH, 5.75 ETH)
  • Pudgy Penguins (333 ETH, 4.13 ETH)

๐Ÿ“ˆ NFT Floor Price Increase

  • Nina's Super Cool World (84%, 0.55 ETH Floor)
  • Velocity Series (66%, 1.15 ETH)
  • Azra Games - The Hopeful (33%, 0.27 ETH)
  • Kanpai Pandas Final Chapter (32%, 2 ETH)
  • Milady (22%, 4.2 ETH)

๐Ÿ—“ Upcoming NFT Mints and Reveals

Today is a bit slower but still some major drops and events.

The morning kicks off with one of the more anticipated CPI data prints in months, with expectations on a potential month-over-month increase and how that may impact the markets.

Then Verse is back with Zach Lieberman with "Cone Gradient Study," with 50 artworks as an edition, 150 mint passes for $1000 each with the ability to get signed prints.

Then DeeKay launches his open edition on Base at noon ET. Open editions haven't been profitable for anyone but the artist in quite some time, but still one to watch over the 24-hour mint period to monitor how the supply is coming out. And of course if you like the art, mint.

If you want more, see the full list of today's drops from Swizzy's daily mint monitor

  • CPI data (8:00 a.m. ET)
  • Verse "Cone Gradient Study" (11:00 a.m. ET)
  • Noble Gallery "SHADOW WORK" (11:00 a.m. ET)
  • DeeKay Motion open edition (12:00 p.m. ET)

Enjoy this write-up and/or want to sponsor the Morning Minute? Follow along with me on Twitter @tyler_did_it or reach out via email

For all volume and floor price data, see Lucky Trader's Project Rankings page.

For all upcoming mints, see Lucky Trader's NFT Calendar page.

Disclaimer: The author or members of the Lucky Trader staff may own NFTs discussed in this post. Furthermore, the information contained on this website or the Lucky Trader mobile application is not intended as, and shall not be understood or construed as financial advice. AI may have assisted in the creation of this content.