The BSC ecological NFT market segment has jumped to second place. What are the characteristics of the decentralized NFT protocol AFKDAO?

According to the latest statistical report released by the NFT data analysis company Nonfungible on the NFT market data for the entire year of 2021, the total trading volume of the NFT market in 2021 exceeded $17 billion, a growth of over 200 times compared to the $82 million trading volume in 2020. If 2020 was the explosive year for DeFi, then 2021 can naturally be called the explosive year for NFTs.

Additionally, in Nonfungible's report, the NFT trading volume of GameFi projects represented by Axie Infinity exceeded $5 billion, accounting for 30% of the total NFT trading volume in 2021.

According to NewZoo's report on the global gaming market in 2021, the number of global players has approached 3 billion, and it is expected that the gaming market revenue will exceed $200 billion in 2023. This indicates that the GameFi market and the development of related NFTs should not be underestimated.

The NFT market continued the heat of 2021 into 2022, attracting more and more institutions and investors globally. Previously, the high gas fees and low performance issues of Ethereum hindered the large-scale development of NFTs.

With the emergence of public chains (Flow, Near), side chains (Polygon, Ronin), and Layer 2 solutions (Immutable X), this issue has been alleviated. However, problems such as poor liquidity and difficulty in valuing NFTs still exist.

In traditional financial markets, the solution to the problem of poor asset liquidity is asset securitization. By definition, asset securitization is the process of converting assets that have poor liquidity but are expected to generate stable cash flows into financial products that have better liquidity and higher credit ratings through a series of structural arrangements and reorganizations.

In the NFT field, application-based NFTs can use the income generated from their applications as their expected cash flow (such as the Play to Earn income from chain games like Axie Infinity), thus achieving the goal of NFT asset securitization. Clearly, within the current NFT ecosystem, the decentralized NFT protocol AFKDAO has found a good entry point.

What makes AFKDAO unique?

DeFi has currently formed a relatively mature product matrix including decentralized exchanges (UniSwap), lending (Compound), aggregators (Yearn), and derivatives (Synthetix), providing investors with more investment opportunities while also solving the liquidity issues of FT assets.

Looking back at the rise of the DeFi market from 2020 to 2021, early participants earned substantial profits through various liquidity mining efforts. Infrastructure platforms capable of solving NFT asset liquidity issues deserve more attention in the next phase.

AFKDAO is a decentralized NFT protocol that provides a complete solution for the integration of NFTs and DeFi. As described in the content above regarding asset securitization, application-based NFTs, primarily from chain games, can generate expected cash flows, which will serve as the basis for AFKDAO to achieve NFT price discovery and interest rate discovery through algorithms, thereby constructing a product matrix that includes NFT IGO, lending pools, aggregators, and other financial derivatives.

The aggregated NFT DeFi platform built by AFKDAO supports any EIP-4610 native or encapsulated NFT assets, which means AFKDAO can connect NFTs on public chains such as ETH, BSC, and Avalanche, enabling cross-chain circulation of NFTs.

In terms of specific implementation, AFKDAO separates the usage rights and ownership of NFTs. NFT holders can place their NFTs into the AFKDAO lending pool, while other players with more time and better skills can borrow the NFTs and participate in the Play to Earn aspect of the game.

During the borrowing process, players do not need to over-collateralize in the DeFi field; they only need to deposit a small portion of assets into their accounts to pay the interest generated from the loan. Since NFT holders are only lending out their usage rights, they do not need to worry about asset security issues and will continue to receive a portion of the Play to Earn income generated by the NFT borrowers.

The entire process is similar to a "scholarship program" that individuals can publish, enhancing the liquidity value of NFTs while also lowering the entry barrier for other players into the metaverse. AFKDAO will also introduce an oracle mechanism in the future, incorporating multi-dimensional data such as the floor price, average price, and P2E income of similar NFTs into the algorithm to obtain more reasonable NFT lending rates.

In AFKDAO's IGO model, because AFKDAO requires chain game projects to disclose their income situation in the form of a Vault on AFKDAO's aggregator during the IGO, investors can calculate a reasonable price range.

This design brings many benefits, including lowering the participation threshold for investors; avoiding investment risks caused by large price fluctuations; and stabilizing prices, which will be beneficial for generating liquidity value for NFTs in AFKDAO's lending pools, aggregators, and other financial derivatives.

What is the current progress of AFKDAO?

From February 23 to February 28, 2022, AFKDAO launched an unprecedented free minting event for NFT Warrior Badges. As long as you own NFTs from dozens of chain game projects currently supported by AFKDAO, such as Aliens World, Bomb Crypto, and MOBOX, you can mint and receive an AFKDAO Warrior Badge NFT for free.

This marketing campaign was more sophisticated than the common "vampire attack," as it did not bring negative impacts to itself and successfully covered over 2 million addresses. Even though the event lasted only 5 days, over 10,000 addresses were successfully converted into seed users of AFKDAO.

Following this, AFKDAO launched the second phase of activities, allowing these seed users to participate in the platform's Beta testing, while also providing airdrop rewards of AFK governance tokens in the future. This not only gave users a sense of participation but also completed relevant testing of the platform's modules and functions.

The AFKDAO project itself has significant development prospects and has successfully partnered with many institutions related to chain games. A series of successful community activities have also allowed AFKDAO's user popularity to temporarily rank second in the BSC ecosystem NFT market segment.

The Beta testing of the AFKDAO platform has now concluded. According to its development roadmap, the upcoming AFKDAO IGO LaunchPad, AFK Aggregator, and Token Private Sale will soon be launched one after another.

Among these, AFKDAO's first IGO project is the most noteworthy, as making a strong start will have a significant impact on the project's subsequent operations. Based on the recent performance of the AFKDAO project team, it is believed that the quality of the first project will not disappoint community members.

Seizing the Growth Trend of the Chain Game Market with AFKDAO

From the perspective of the development of the chain game market, although the current heat of the GameFi market has declined to some extent, the market prospects remain very broad. Once a quality project brings about a wealth effect, the entire GameFi market is likely to rebound significantly. Meanwhile, AFKDAO, as an indispensable DeFi infrastructure for NFTs in the future, will also gain higher attention as the market warms up.

Just as Compound in the DeFi sector sparked a liquidity mining craze in June 2020, the liquidity value of NFTs is bound to be ignited at some point in the future. AFKDAO is currently in its early development stage, and its ecosystem, whether it be the AFK governance token or AKF NFT, possesses strong value capture capabilities, making it a potential investment target for seizing the growth of the future chain game market.