Focus on NFT: 2020 Digital Asset Market Report

Original author: NFT Lab

NFT Project List

From left to right are collectibles/games, artwork, Metaverse, services

NFT Market Overview

NFT market transaction volume since January 2019. Source: Dune Analytics, Josepimpop

Data from Dune Analytics shows that in November, the NFT market turnover is still high, totaling 9.3 million Dollar. Combining the turnover of the NFT market from December to the present, the cumulative turnover of the NFT market in 2020 is nearly 46 million US dollars.

Top NFT transactions in the past 30 days

Collectibles game Project Axie Infinity was one of the highest valued projects in the last 30 days with $1.8 million. (Note: nonfungible.com only tracks Ethereum-based NFTs. The chart above does not include NBA Top Shot data. NBA Top Shot data is based on the Flow blockchain or any WAX block On-chain NFTs like Bitcoin Origins.)

NFT art market SuperRare and fantasy football card game Sorare turnover Second only to Axie Infinity, both exceeded $1.2 million.

Decentraland and CryptoPunks are two of the longest running NFT projects on Ethereum. In the past month, both projects have been very popular, with a transaction volume of more than 300,000 yuan.

In the past month, the NFT service system ENS (Ethereum Name Service) has the highest transaction volume among similar systems, exceeding $140,000.

This month's report will provide further insight into several top-ranked NFT projects in different categories over the past month.

1.Axie Infinity (collection/game)

2. Sorare (collection/game)

3.  SuperRare (Artwork)

4. Decentraland (Metaverse)

Axie Infinity

Axie Infinity is a Pokémon-inspired digital pet game where players collect, train, breed and battle Axies. Each Axie has unique genetic data stored on Ethereum. This game (blockchain game/NFT collectible) is developed by Vietnamese game studio Sky Mavis. Founded in 2018, the studio focuses on technological development games.

Axie Infinity features a variety of animated characters and multiple game settings, and is the first Such games. In the Axie Infinity universe, community builders can independently build tools and obtain experiences, and all art assets and Axie genetic data are available to third parties.

Axie can have 6 body parts from more than 100 choices, each body part has its own way of fighting, arranged The combinations are endless. In each site, Axie has three genes: dominant gene, recessive gene and minor recessive gene. Dominant genes can determine which body parts Axie will present. Axies can be used in battles and tournaments, where players are given opportunities to win rewards.

The game's breeding mechanic introduces scarcity, as Axie can only breed 7 times. The breeding cost of Axie is 0.005 ETH plus a certain amount of SLP (Small Love Potions), and the number of SLPs will increase with the number of times Axie breeds. During the breeding process, each of the three genes has a certain possibility of being passed on to the next generation, the possibility of the dominant gene is higher, the recessive gene is lower, and the minor recessive gene is lower.

The other main part of the game is Lunacia (Axie Metaverse). Lunacia can be divided into tokenized land parcels (an NFT, like Axie and items, like SLP). Players can find AXS tokens in these plots and discover rescue nodes. Landowners have priority rights to all breeding resources on their land, which can be used to upgrade Axies and land.

Axie Infinity Number of users (left axis) and transactions (right axis). Source: DappRadar

Axie Infinity has its own internal marketplace, the Axie Marketplace. Players can buy, sell and auction items in the market, and can also accept quotations from others.

Axie can be sold on multiple NFT marketplaces, but most transactions are made on the Axie-specific marketplace. The market has grown rapidly over the past few months.

Since the beginning of September, the number of users and transactions has increased by almost 10 times.

In November, the number of daily users peaked at 6727, and then began to decline. In November, the daily trading volume reached a peak of 15,747.

Axie NFT average price in USD. Source: nonfungible.com

The value of Axie is determined by its scarcity and utility in the game ( Players earn money for winning matches).

Scarcity: The number of NFTs is scarce and each Are not the same. Different classes of Axie have different levels of scarcity. Such as insects and birds are more scarce than other species. Axies with Mysterious Body Parts will also cost more, both due to their rarity and their ability to transform into Legendary Axies. The project recently added Chainlink's Verifiable Randomness Function (VRF), which ensures that newly generated Axies are provable, fair, and random.

Utility: There are different types of Axie, which is also the game's Strategic. By acquiring different types of Axie combinations with complementary advantages and different weaknesses, players are expected to win in battles and competitions to earn income.

As the game continues to develop, the utility of Axie continues to increase, and the average price of Axie has exploded from less than $10 at the beginning of the year It peaked at $715 in October and then fell to around $64. The Axie with the highest transaction volume last month was named Greg - successfully sold for 150 ETH, about $95,574.

Greg has three mysterious body parts and is one of the rarest Axies. The initial purchase price was only 10 ETH on September 12, 2018, which was about $3,000 at the time.

After two years of planning, Axie Infinity launched its own ERC-20 governance token - Axie Infinity Shards ( AXS).

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AXS is similar to UNI, the governance token of the Uniswap protocol, and has introduced a retrospective reward distribution system. Any user who participates in Axie Infinity before the snapshot event on October 26 can enjoy AXS tokens.

The token will gradually decentralize the ownership and management of Axie Infinity. Players can earn rewards by staking tokens, participating in games, and voting on major management decisions. They can also earn AXS by participating in Axie Infinity games or user-generated games.

Q3 2021 will launch the full AWS ecosystem including staking, governance, game rewards earning and Community land game setting initial version.

At the beginning of 2021, the Community Treasury will go live and start receiving Axie Infinity Income and partial staking rewards. Once the network is decentralized, the Treasury will be governed by AXS stakers.

Top 10 NFT tokens by market capitalization. Source: CoinGecko

In the past 30 days, Axie Infinity Shards (AXS) has appreciated 66% against the US dollar, becoming the NFT coin with the highest market capitalization 3rd ranked token in . The prices of RFOX and MpE have appreciated almost 100% against the USD over the past 30 days.

Axie Infinity Shards (AXS) level (left axis is USD, right axis is BTC). Source: TradingView

The above chart also shows the uptrend of AXS on Bitcoin (BTC) and US Dollar (USD).

The top is the current blockchain stack structure, and the bottom is the future blockchain stack structure. Source: Axie Infinity Whitepaper

Sky Mavis is developing an Ethereum sidechain called Ronin exclusively for Axie Infinity.

Axie Infinity currently uses both Ethereum and Loom network sidechains. Axie and SLP are both ERC-721 tokens on the Ethereum mainchain, while Land NFTs, Item NFTs, Loom ETH, and Wrapped ETH are on Loom’s sidechains.

Ethereum will transform the future blockchain cascading structure and connect with other blockchains and Ronin sidechains At that time, all NFT (Axies, land and items), AXS tokens, SLP and various tokenized resources will be supported on the Ronin side chain.

The Ronin sidechain entered the public test chain in July 2020. The transfer of assets from Axie to the Ronin sidechain will be completed in the first quarter of 2021, and the audience for collectible games will be much larger by then.

Sorare

Super scarce in this season  Ronaldo (Cristiano Ronaldo) Cards

Sorare is a football card game built on Ethereum, using ERC- 721 protocol, certified by more than 150 football clubs.

Launched in May 2020, Sorare, in partnership with Ubisoft, major football data provider Opta and others, is now Has become a popular NFT project. The project employs Barcelona defender Gerard Pique as a strategic advisor and also includes ex-footballers Andre Schurrle and pmanuel Seuge.

Sorare cards are digital collectibles representing football players, tied to specific football seasons. Fans can collect their favorite player cards, which are verifiable and scarce, with fully digital historical records, anti-counterfeiting, and anti-plagiarism. There are three levels of Sorare card rarity for the 2020-21 season: unique cards, ultra-rare cards (10 types), and rare cards (100 types).

Sorare cards are tradeable at will and can be used in a variety of apps and games. Players can use officially licensed digital cards to play and earn rewards every week in fantasy football games around the world.

Sorare's 5-a-side (SO5) is the first fantasy football game available with Sorare cards. Players use 5 cards to form teams of players, and the points earned are determined by the performance of the selected players in actual football matches.

Soare the number of users (left axis) and transactions (right axis). Source: DappRadar

Since May 2020, Sorare has seen steady growth in user count and transaction volume. In November, the number of daily active users peaked at 110. But the number of transactions failed to break the September 2020 record of 1,219.

Sorare NFT average price in USD. Source: nonfungible.com

The value of the Sorare Card can be measured in three ways:

Collectible value: Each card has a unique degree of demand and has different values for different players (because of favorite players, clubs, nationalities, etc. are subjective).

In-Game Value: Cards can be used in fantasy football games around the world, and players can get them weekly income.

Third party game value: Sorare cards will eventually be valuable in multiple games, and the game Developers will build different new game experiences based on Sorare cards.

Since May 2020, Sorare NFT has been supported by many top football clubs (e.g. Bayern Munich in November, Bayern Munich in December Real Madrid), the average price increased to about 8 times.

One of the highest selling cards over the past month was a unique Sorare card - Kylian Mbappé, for 116.15 ETH was successfully sold, which was about $66,000 at the time.

Sorare auction amount (ETH). Source: Soraredata

CryptoKitties (CryptoKitties) has led the use of Dutch auctions, that is, reduced-price auctions, as an NFT price discovery mechanism the first of its kind. In a reduced-price auction, the auction starts at a high price and decreases successively until the first bidder responds or reaches the reserve price.

Unlike CryptoKitties, MyCryptoHeroes, and many other popular NFTs, Sorare uses an English-style auction, known as an incremental auction. This type of auction is often used on platforms such as eBay. Bidders bid for the Sorare player card, and the highest bidder wins the auction after a certain period of time. Bids are fully refunded at the end of the auction if other bidders bid higher.

The above chart shows that on November 29th, Sorare auctioned a record amount of 194.14 ETH. Another peak of auctions exceeding 100 ETH occurred on December 17. The increase in auction sales indicates rising interest in the Sorare Card, driving Sorare Card valuations upward.

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Sorare was originally built on Loom Plasmachain (later renamed Basechain), but decided to port to Ethereum mainnet after Plasmachain was eventually discarded.

Sorare also plans to actively participate in the various stages of Ethereum 2.0 to ensure that the football card game can be scaled and popularized, And free from network congestion. Sorare's user and transaction numbers are expected to continue to grow as more football clubs license and more third-party applications are built within the Sorare ecosystem.

To drive user adoption, Sorare is considering scaling solutions such as SKALE and zk -Rollups. SKALE is a flexible decentralized blockchain that supports thousands of independent ledgers, sidechains and other Ethereum subchains.

zk-Rollups is a potential expansion solution, using zero-knowledge proof to convert hundreds of batches of transactions into a single transaction, Reduce network congestion and reduce transaction costs. Smart contracts will be used to deconstruct and verify all transactions in a single transaction. After zero-knowledge proof, it is used to display and publicly record the legality of Ethereum blocks, reducing the amount of resources and data required for transactions.

SuperRare

@notsatoshi's work "Satoshi Nakamoto in where? 》, SuperRare is for sale

SuperRare was established in 2017 and is a unique version that users can collect and trade A marketplace platform for digital artwork. All artwork created by each artist can be tokenized into digital collectibles for owning and collecting.

The SuperRare platform has over 600 artists who have earned over $2 million to date. After a sluggish first year and a half in transaction volume, SuperRare picked up in 2020 to over $4.5 million. The highest paid artist has earned around 1004 ETH.

Like most NFT projects, SuperRare uses the ERC-721 protocol. Collectors can buy works of art with ETH. Artists get 85% of the proceeds from primary sales.

A secondary market sale of franchises has been incorporated into the Ethereum smart contract, generating passive income for artists. These tokenized works of art can be traded in a secondary market, and the artist receives a 10% royalty on the secondary market.

NFT interoperability: SuperRare partners with Decentraland to allow artists to showcase their work in virtual reality environments or worlds .

NFT artwork monthly turnover (color examples from top to bottom are known sources, Async Art, MakersPlace, SuperRare). Source: Dune Analytics, rchen8 (excluding Nifty Gateway)

The transaction volume of the NFT art market has fallen from October 2019 $20,000 increased to nearly $1 million in December 2020, across four major projects: Async Art, Known Origin, MakersPlace, and SuperRare.

SuperRare is one of the major NFT artwork platforms, accounting for the majority of transactions on such platforms.

SuperRare artist (bottom line) and collectors (top line) growth. Source: Dune Analytics, rchen8

The gap between the total number of collectors and artists in SuperRare is widening, indicating the field of token art Demand keeps rising.

There are twice as many collectors as there are artists on this platform. At the beginning of this year, there were 263 artists and 363 collectors. At the beginning of December, the number of artists increased to 658, and the number of collectors reached 1357.

SuperRare: Number of users (polyline) and transactions (blue area). Source: DappRadar

In 2020, the number of SuperRare transactions will increase steadily, with an increase of over 50%. The number of daily transactions saw a brief fall in the fall and reached an annual peak in mid-September – rising to 632 on 23 September.

The number of daily users increased from less than 80 in January 2020 to about 120-140 in December 2020.

From left to right in the table header are items and average price. Source: nonfungible.com, data as of December 17, 2020

In the past 30 days, the top NFTs by transaction volume Among the projects, the price of SuperRare NFT belongs to the highest category. As of December 17, the average price reached 1682.67 US dollars. Its average price is second only to Async Art and Cryptopunk. At the end of November, the average price of SuperRare NFT reached its peak, exceeding $3,500, an increase of more than 2,200% from the beginning of the year.

SuperRare NFT average price in USD. Source: nonfungible.com

Like Sorare, SuperRare also uses English auctions. In December, SuperRare added two time-limited auction mechanisms, and the platform fully introduced trust-free English auctions. Works of art and bidding results will not be interfered by idlers, etc., and all auctions are guaranteed on the chain. Ethereum has a set of open-source smart contracts as an auction house that prevents various types of fraudulent behavior in traditional auctions (such as ghost bids, a type of false bid).

Decentraland

Decentraland platform live music performance

Decentraland is a persistent and open social virtual reality world built on Ethereum, launched in August 2017 A total of $26 million was raised in its initial coin offering (ICO). Nodes running on computers all over the world have loaded content, which means that Decentraland cannot be closed and will permanently appear on the blockchain.

Decentraland is one of the oldest NFT projects, reminiscent of popular games like Minecraft, Second Life, etc. . On this platform, players can buy, build, explore virtual structures, and socialize.

Each land package on the platform is an NFT using the ERC-721 protocol, with a unique coordinate. The distance between the land package and the hot area usually determines its value. In the Decentraland market or external marketplaces such as OpenSea, players can buy, sell and lease land.

COVID-19 lockdown restrictions put Decentraland in a good position to host online conferences/events and offer new types of advertising Way. Decentraland functions include: digital artwork display, live music, games, event/conference hosting. Players can not only buy virtual land plots and scenes, but also buy names and wearable equipment for characters.

Decentralized Autonomous Organization (DAO) allows users to participate in the creation and operation of virtual worlds.

Decentraland: Number of users (line) and transactions (blue area). Source: DappRadar

Although as one of the projects with the highest transaction volume of NFT, the number of daily users and transactions of Decentraland in 2020 has no In addition to the surge, the year is basically relatively sluggish.

Decentraland NFT average price in USD. Source: nonfungible.com

Among the NFTs with the highest trading volume, the Decentraland land package has the highest price (refer to the table below) . But its average price has been relatively stable for most of 2020, below $2,000. It soared to over $10,000 on December 7th.

From left to right in the table header are items and average price. Source: nonfungible.com, data as of December 17, 2020

In order to solve the expansion problem and reduce transaction costs, To improve transaction speed, Decentraland users can take advantage of Matic’s Proof of Stake (PoS) sidechain, a Layer 2 scaling solution (formerly known as Plasma) built for Ethereum.

Source: MATIC

Matic's Plasma lets developers The protocol in Ethereum is ported to this sidechain, which is compatible with the Ethereum Virtual Machine (EVM).

In testing, the side chain has been proven to increase transaction speed, supporting 7,000 to 10,000 transactions per second Compared with regular on-chain transactions, the cost is only 1% of the gas fee. From this, it can be seen that Matic can enable Decentraland to support a larger user base.

Future Outlook

The top-ranked NFT projects are all on the rise in terms of user volume, transaction volume, and transaction volume. This trend is expected to continue through 2021. In 2021, the cumulative transaction volume of the NFT market is expected to reach 1 billion US dollars. NFT projects have begun implementing and testing scaling solutions (such as Loom, Ronin, MATIC, and zk-Rollups), and are considering (or have used) these solutions to reduce transaction costs and avoid clogging the Ethereum blockchain network.

The development of games and artworks is the two main engines to promote the popularization of NFT. The projects listed in this report can fully demonstrate the benefits of this development trend:

As the most Popular NFT project Axie Infinity. Axie Infinity will build on its success in 2021 by introducing a land game setting with a mobile game. After adding the land game setting, the game will include buying and selling land plots, similar to Metaverse games such as Decentraland. At the same time, the game is expected to introduce farming income as real farming.

Sorare is one of the NFT projects with the highest transaction volume. Sorare combines blockchain technology with the popular licensed card game. Projects such as Sorare, NBA Top Shot, and F1 Delta Time are bringing the concept of cryptocurrency to more people.

SuperRare is one of the dominant art markets, with a steady increase in the number of artists and collectors in 2020. The average price of SuperRare NFTs is also on the rise, indicating that there is a strong demand for NFT artwork. As more and more artists join the platform, in 2021 SuperRare will further increase in transaction value, turnover and user numbers.

Decentraland is the most successful Metaverse NFT project, with the highest transaction volume among such platforms in the past 30 days. As the AR/VR world passes through the early adoption stage and more and more people become familiar with AR/VR, more people will surely adopt the Metaverse NFT project.

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