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NFT industry chain is fully sorted

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In this paper, from the perspective of protocol layer and application layer, the important projects of NFT are sorted out completely.

Title: From Casting to Circulation, All-round Combing of the NFT Industrial Value Chain

原文作者： Jasmine Zhang 、 Fiona He， A & T Capital

In late June, we published a study in the NFT track space and outlined our focus on investment opportunities in the NFT space. So far, NFT is on the rise, and we see more industry leaders dabbling in NFT. We hope to share our methodology for NFT industry value chain through the following article.

On June 21st,AlipayIn the "ant chain fan grain" small program limited to the sale of two "Dunhuang Feitian, nine-colored deer" payment code NFT skin, the line was quickly snapped up.

On June 24th NBSP, an American social network featuring news aggregation and commentary, dubbed the "front page of the Internet".Reddit NFT Cryptosnoo is released for a seven-day auction. Users can purchase CryptoSnoo NFT Link it to your Reddit account as a Reddit avatar, and a collectible NFT card will appear in your profile.

On June 25th,Diffuse weiWith & have spentVeVe Digital Collectibles APP partners to launch official NFT digital products, 3D statues and digital comic books.

July 1, CNN & NBSP;CNN Launches two collectible NFT moments in news history, "Birth of the world's first 24-hour television news network CNN on June 1, 1980," and "Exclusive coverage of the outbreak of the Iraq War by CNN correspondents in January 1991."

July 6th, Blockchain Games and NFT Developer & NBSP;Animoca Brands Announced Acquisition of Jack Ma, Joe Tsai's Family-managed Fund & NBSP;Blue Pool Capital An investment in.

For nearly a month, although the market is still depressed, but the "circle" continues to maintain the exploration of NFT. The reason, of course, is that the value of NFT is gradually recognized. In our view, the innovation of NFT is that it provides oneMark native digital asset ownership(that is, assets that exist in or originate in the digital world), and that ownership can exist outside of a centralized service.

The value of NFT lies in that it expands the category of assets on the chain and makes it possible to represent assets that could not be previously. At the same time, the expanded asset class is closely related to the mass population and easy to spread, which makes the logic and business model behind NFT easier to understand and accept.

We believe that NFT tracks still have great potential, and the NFT landscape is just beginning to be pieced together, so we have sorted out the NFT industry value chain according to NFT foundry to circulation. On the one hand, we will use this chain to help streamline the investment logic; On the other hand, we also welcome peers or project parties to share their experience with us.

The hierarchical logic of NFT industrial value chain in the figure below is as follows: the overall NFT flow is divided into three layers, from bottom to topInfrastructure layer, protocol layer, and application layer.

Infrastructure layer, mainly covering the underlying public chain, side chain /Layer2, development tools, token standards, storage, and wallets. The capture value of this Layer is based on the casting of NFT. For example, the Gas Fee generated by the casting is captured by the bottom public chain and side chain /Layer 2. The greater the number of NFTs, the greater the capture value of this layer.

The protocol layer, including:

1. NFT Casting Agreement (Mint & Launch) and primary circulation market (Sell & Trade), and most deals do both to further capture value. Capture value is based on primary transaction of NFT, because secondary transaction is more about platform traffic, and OpenSea is currently the secondary platform with the largest traffic, so this layer of casting protocol can only capture value by primary transaction, which is why. Mintable The concept of Gasless Item will be introduced to attract users to cast and conduct subsequent transactions on the same platform, and only after the transaction will the NFT be linked to capture the first-level transaction value.

2. Liquidity agreement, mainly used for value discovery of NFT. Rather than minting NFTs, these agreements price NFTs in various ways. Value capture is likely to be similar to DEX and prophecy machines in the future, based on providing liquidity-based financial services.

3. DEFI +NFT, mainly NFT cast by DEFI activity, differs from other casting protocols in that value is mainly captured through casting activity.

The application layer, which is mainly derived from the token generated based on the protocol layer, such as the NFT traded in the pan-secondary market representative project OpenSEA, which is mainly composed of each casting protocol platform at the protocol layer. Value capture at this level is mainly based on traffic and demand realization, such as social networking and exhibition curation. How to gather traffic and realize is the core value point.

从铸造到流通，全方位梳理 NFT 产业价值链

Next, we will introduce the protocol layer and application layer projects that we focus on.

Protocol Layer - NFT Casting Protocol and Primary Market - "Integrated"

This category represents the variety of physical objects that can be tradedGeneral exchange market. NFT's move to the mainstream is closely related to the NFT foundry platform and primary market, because the platform directly connects creators and users. On the one hand, the platform needs to further reduce the threshold of users' acceptance, improve users' sense of use, and increase users' stickiness and participation. Please refer to Xianyu APP. On the other hand, the platform needs to provide an easy-to-use NFT creation experience for creators, lowering the threshold for creating NFT low enough to attract more diverse creators to showcase.

Mintable: Provide users with a trading platform with functions such as private messaging, promotion and scoring, and introduce ERC-721 as the voting governance token, and Gasless item to attract users to stay on the platform after casting.

Mintbase: Based on the NEAR ecological trading market, users can create and sell music, art, tickets, photography and other NFT.

VIV3: The first trading market based on Flow.

Zora: Founded by the former product manager of Coinbase, the main product is a platform for creators or artists to publish their works in the form of media, including video, audio, files, etc.

Cargo: Allows users to build and sell NFTs on the platform, supporting Ethereum, XDAI, and Polygon

TerraVirtua: art, collection, game IP casting trading platform. The operating environment is highly compatible, enabling users to present, trade, and interact with NFT in an immersive manner; At the same time, it is based on 3D Fancave, Terradome and Galleries virtual interface and mobile AR applications, user experience is good, IP resources are strong.

Agreement Layer - NFT Foundry Agreement and Primary Market - "Art/Collection"

This category representsArt/collectibles mainly in the casting as well as the primary market. Art projects focus on strong IP resources and artistic taste, while collection projects focus on future embedding and colored eggs. Among them, most art projects have a high threshold, and only the creators with a certain artistic background or enough fans on social platforms can be allowed to enter the platform, which is contrary to the concept of no access and equality advocated by the crypto world.

SuperRare: Established in 2018, the earliest NFT art casting platform has certain thresholds for art works and artists.

CryptoKitties: The digital cat collection and breeding game on the collection blockchain technology, launched in 2017, once accounted for more than 16% of the transaction traffic on the Ethereum network, causing the Ethereum network to be overwhelmed and severely congested, with transfer transactions delayed and unable to transfer.

Makersplace: Rare art casting trading platform.

CryptoPunks: NFT built on Ethereum, founded in 2017, and originally inspired the ERC721 standard. By reinventing the ERC20 contract to issue tokens, it generated 10,000 completely different 24x24, 8-bit style pixel art images.

Rarible: Founded at the end of 2019, it mainly focuses on interesting art works and is founded by Russian serial entrepreneurs. It is the first NFT trading platform to launch governance tokens.

HashMasks: 16,384 unique portraits created by more than 70 artists worldwide in 2021, in the form of a blind box and users can name each painting, enhancing user engagement and giving more value to their tokens.

NBA Top Shot: Collecting games based on the Flow public chain. NBA Top Shot, through an official IP licensing partnership with the NBA, allows collectors to obtain legitimate NBA star highlights through gamification, and can be traded in the market within the platform.

Nifty Gateway: A regulated NFT money market, acquired in 2019 by "Bitcoin billionaire" twins Tyler and Cameron Winklevoss, the exchange's first acquisition. The platform utilizes Gemini Its back-end infrastructure establishes a dollar-exchange platform that allows users to buy NFT with a credit card that can be cashed directly into a bank account when sold.

Bored Ape Yacht Club: NFT Tide Play + Member Club.

Autoglyphs: Cryptopunks development team & NBSP; Larva Labs The second NFT project is Generative Art Platform.

MeebitsThe third NFT project by Cryptopunks development team Larva Labs consists of 20,000 unique 3D voxel characters that are available for use by developers. Its owner can access a bundle containing the full 3D model, freely render and animate Meebit, making it available for use in any game engine, 3D studio, or as an avatar in Metaverse. At the same time, MeeBits can exchange MeeBits directly.

Foundation: Community driven, high threshold casting trading platform.

Async Art: Programmable art (main), music casting trading platform.

KnownOrigin: High-end art casting trading platform (first and second level).

Avastas: Generative art trading platform.

Art BlocksGenerative Art Generative Art trading platform

Protocol Layer -- NFT Foundry Protocol and Primary Market -- "Games"

This type of app is an example of how current chain game developers are using NFT to power the in-game player economy. Previously, the strategy for NFT game projects to attract players was P2E(Play-to-earn) model, which takes advantage of the unique tradable nature of NFT items in order to create a conformable game economy, but the lack of attention on the design of the game itself does not attract long-term players in the coin circle, let alone those outside the coin circle, to abandon the centralized game and join the chain game. Over the past few years, developers have come to realize that a successful chain game needs a solid play experience to support it, and P2E can fully unlock the potential of chain games.

Axie InfinityAxie Infinity is a chain game that collects and raises all kinds of strange and strange creatures. In addition to the normal collection attributes, Axie added its own combat attributes, making it one of the first NFT pets to be able to fight. The Axie team also launched a customized Ethereum side chain Ronin for the game in February, which uses POA consensus to speed up validation to relieve congestion on the Ethereum network and player gas fees. Axie has become the face of the chain game, with sales topping $121 million in June, up 351 percent month-on-month, and nearly three times the sales of the next best NBA Top Shot ($45.43 million).

Gods Unchained: The first etherium-based card game on the chain, similar to Hearthstone, where users can freely trade and sell their cards and own the ownership of the cards.

Zed: The first AR horseracing game on the blockchain based on Ethereum Layer2, forming a one-stop NFT horseracing experience for charging up all kinds of gameplay such as raising horses, horseracing and watching races. Atari has licensed Asteroids, Centipede, Missile Command, Pong, and many other games to Zed Run. In the future, the boundaries of gameplay and content will continue to expand as more and more horseracing players join the game.

SkyweaverGods Unchained is a digital transaction card game with actual transaction features. Players control the economy and the value of NFT cards based on the number of cards they craft in different game modes, the demand for certain cards in the store, and the number of players who offer cards for sale in the store.

Alien Worlds: A Defi game based on the Wax public chain, players can earn Trilium (TLM) by mining, and have a certain chance to reach NFT each time they mine. Trilium can be used to pledge to one or more of the six planets in the game, and after signing up as a candidate for Planet Council, the player will be able to rule the planet. NFT cards introduce innovative gameplay over time, including "sparkle" to upgrade cards and fight in fighting games

Sorare: Fantasy football game based on Ethereum developed by startup Sorare. Players can buy and trade NFT player cards that are certified by clubs or leagues to form their own teams, all with a scarcity and uniqueness rating, and each player card is rated based on their real-world performance. Players with a complete lineup can participate in fantasy football matches on the platform and earn cards and tokens.

Mega Crypto Polis: A city management game based on Ethereum and Tron, where players can start acquiring a plot of land on a distributed city map to build a series of building types. Each piece of land, together with the buildings under construction, is NFT and can be transferred or traded in the market. Every action in the game requires some tax to be collected for the regional and federal budgets, which are then distributed to all players based on their share of the total points of influence generated during the game's 24-hour cycle.

Protocol Layer -- NFT Casting Protocol and Primary Market -- "Meta Universe"

This type of application represents the presentAn example of a meta-universe using NFT as a way to confirm ownership of digital assets. Compared with the early applications of art and collectibles, the current meta-ecology in NFT still has a considerable space for development. The current problems to be solved are as follows:

1. High application hardware threshold and imperfect optimization. The user's computer needs to be configured to run open world renders smoothly. In the future, the project still needs to make a choice between visual presentation and smooth play experience.

2. Compared to other blockchain domains, the meta universe is currentlyLack of fit their own advantages of play and make rich effect. Most of the current meta-universe ecology is still built around NFT collectibles. Collectors display their collections in various corners of the meta-universe, just like a 3D OpenSea, which has few attractions for open-world players.

3. The player group is still limited to users within the circle.You can't reach the mass of people who don't care about blockchain. This requires strong IP+ smooth use experience + innovative NFT meta-universe gameplay to combine the circle.

Cryptovoxels: Building a virtual world on Ethereum. By building, developing, and selling real estate parcels on encrypted pixel blocks, users will own their land in the form of NFT and can hang different NFT collectibles within the building.

Decentraland: A virtual world built on Ethereum, similar to Cryptovoxel, providing land in the form of NFT, Avatar wearable, and content server. Decentraland uses its proprietary cryptocurrency, MANA, to subsidize all operations and plans in the meta-universe and to act as currency for transactions among its users.

The Sandbox: Pixel sandbox building games like Minecraft and Roblox, Players can create digital assets in The form of NFT in The Sandbox VoxEdit and upload them to The store, and create games on their own property using Game Maker's simple drag-and-drop method to attract other players.

Somnium Space: Somnium Space VR is an etherium-based VR social app that allows users to buy land, build or import objects to create shared virtual worlds. Provide native NFT integration and support for mainstream headsets to explore in full VR form, using Cube as an in-app interactive token.

Agreement Layer -- NFT Casting Agreement and Primary Market -- "Fan Economy"

Under the traditional fan economy, neither fans nor idols are the biggest beneficiaries in this ecosystem. Instead, it is the centralized social platform that serves as a medium for creators to build connections with their fans, generating most of their revenue by inserting advertisements and algorithmic recommendations between creators and users. On the other hand, the interaction between idols and their fans is often monotonous and one-way. The advantage of NFT lies in the more efficient connection between fans and idols, encouraging two-way interaction between idols and fans. The fan economic platform around NFT ecology needs to set up appropriate economic incentives and mechanisms for both fans and creators, so as to facilitate "civilians" to become idols and encourage more originals.

BitClout: Allows users to use cryptocurrency to hype Creator Coin, NFT based on celebrity fame. It is built on its own custom blockchain and supports complex social networking activities such as posts, profiles, followings, and other speculative functions. PoW Blockchain is designed specifically for running social media. Everyone can own their Creator Coin and can buy and sell it at will.

Rally: Allows creators to launch their own social tokens. Rally is managed by its local token, Rly, where fans can purchase creator tokens to support their favorite creators and receive special benefits determined by the creators. Developers can build on their social token driven business models and share the economy with fans. The platform can also combine its native governance token, Rly, with the creator's social token and forge a new token, while designing a Layer2 solution that allows instant transactions, purchases in dollars, and the inherent value capture mechanism of using the glued curve.

Roll: Create ERC-20 tokens on behalf of users and provide a place to store and trade. The distribution model is that each social token will have a supply of 10 million, 2 million of which will be given directly to content creators, 1.2 million of which will be owned by Roll, and the rest will be unlocked on a linear monthly basis for three years. After social tokens are issued, creators can sell them, distribute them to fans via the Roll app, list them for sale or strictly peer-to-peer transactions, or at Uniswap To exchange other tokens.

Mirror: The Mirror's platform token $WRITE (ERC-20) represents the rights of writers to publish content on the platform. Content creators must destroy $WRITE in order to open their column. The Mirror team selects a group of writers as the platform's first writers and holds a weekly $WRITE Race. Authors voted by community users will be offered tokens to open their columns. Authors can crowdfund their works by issuing tokens to fans at the beginning of their works. After the completion of their works, they will be linked in the form of NFT, and the profits generated by article reprinting, reward and auction will be shared according to fans' contributions in crowdfunding.

Chiliz: The use of tokens on the fan website Socios.com provides sports and eSports fans with the right to jointly manage teams, tournaments, leagues and other activities in the form of voting, and participate in team management and strategic decisions. Organizations such as teams and leagues in sports and esports can also economize fans by giving them some decision-making power.

Application Layer -- Finance -- "Liquidity Agreement"

This category mainly represents NFT as the underlying asset,Offer NFT pricing agreement. At present, there are three solutions: one isThe buyer of the pricing, such as & have spent TopBidder Pricing by auction; The second isThe seller's pricing, such as NiftEx/NFT20 / NFTX The seller pledges NFT and generates ERC-20 to provide initial liquidity to generate pricing; The third isThird Party PricingUpshot, for example, generates pricing based on the predicted behavior of random users. These liquidity agreements are the necessary financial infrastructure to provide NFT value discovery for complex upper-layer applications.

NiftEx: May 2020, allowing NFTs to be pledged and their ownership split into ERC-20 to promote liquidity, with a market value of $4.4m for all pledged NFTs as of July 7.

Upshot: Open Beta will be launched in May 2021. Use predictive markets to provide NFT price discovery. Instead of entering an exact price, simply complete a series of simple multiple choice questions and select the one you think is of higher value from two random paintings.

NFT20: Launched in November 2020, allowing NFT to pledge and generate its ERC-20 token derivatives, which can be traded to Dex such as Uniswap to promote liquidity. As of July 7, the market value of all pledged NFTs was $1.4m.

NFTX: January 2021, allowing the pledge of NFTs and splitting their ownership into ERC-20, with a market value of $3.2m for all pledged NFTs as of July 7.

TopBidder: Launched in April 2021, is a crypto art and collectibles auction protocol that brings price discovery to NFT.

Application Layer -- Finance -- "Defi +NFT"

This category mainly represents the use of NFT as an asset representation toolThe agreement. NFT can be seen as an evolution of tokens, from being able to represent only undifferentiated assets to being able to define more unique values. This category is going to happen"Defi" class NFT, such as Uniswap LP Token and YInsure Policy. Compared with NFTs cast by art and collectibles casting agreement, these NFTs are mainly reflected in different casting methods, which are cast through financial activities.

Uniswap V3: Launched in May 2021, LP tokens are represented as NFT, which defines the liquidity value under different market making strategies. As of July 7, the total lockup capacity is $1.8B.

Aavegotchi: Launched in March 2021, it is acquired by mortgaging AToken, an interest-paying deposit certificate on the AVE lending platform, expanding the use of NFT into the game scene.

Dego: Launched in September 2020, the project will airdrop NFT Gego with different rarity through blind box, and get the reward of DEGO token after pledging. You can also participate in community governance by holding NFT. In the future, users will also be able to cast NFT with Dego tokens. As of July 7, the market value of all pledged NFTs was $9M.

Yinsure.finance: The unique insurance policy is tokenized with NFT, which can flow in the secondary market and increase the liquidity of the insurance policy.

Meme: Launched in September 2020, through the game combining DEFI and NFT (Stake Meme to a specific mortgage pool to get the corresponding score, with which the score can be exchanged for NFT).

Application layer -- finance -- "mortgage lending"

The main representative of this category & NBSP;NFT as the underlying assets to achieve mortgage lendingThe agreement. At present, due to the lack of NFT liquidity and pricing problems, mortgage lending can only be realized in the form of P2P. But by referring to the DEFI iteration path, from ETHLEND to AVE, P2Pool may be the next upgrade path.

NFTfi: Online in February 2020. In the form of P2P, borrowers will put their NFT assets into the market as collateral, and then the market lenders will quote prices. As of July 7, the amount of loans was $4.8m.

Pawnhouse: The beta will be launched in July 2021, also in the form of P2P, borrowers will put their NFT assets into the market as collateral, and then the market lenders will quote.

Taker Protocol: Not online yet. Also in the form of P2P, the introduction of the ERC-20 token TAI as an interest-paying deposit certificate creates a lending pool that acts as a bridge between DEFI and NFT.

Application Layer -- Finance -- "Asset Management Tools"

This category is mainly Asset management tools at the upper level of NFT industry chain, similar to Zapper, Debank and other asset management platforms in DEFI. There are fewer projects at present.

NFT Bank: The asset management platform for NFT will be launched in June 2020.

Application layer - pan-secondary market

This kind of platform is mainly the secondary market formed after the casting of NFT. Different from the primary market, this kind of platform will assume the responsibilities of the secondary market, mostly including the NFTs produced by the main casting platform.

OpenSea: Launched in December 2017, it is currently the largest NFT trading platform. The sales volume in June was nearly $150m.

Auctionity: Launched in beta in January 2018, it is an on-chain auction house for crypto collectibles.

TokenTrove: Launched in October 2019. This is mainly for the secondary market of games, especially Gods Unchained.

Application Layer - Vertical Domain - "Data"

No comprehensive data provider has emerged in the NFT data space. Existing data are either incomplete in NFT coverage or incomplete in data dimension. In addition, there is also a lack of a full-featured NFT search engine, which is an important entry point for future traffic.

Cryptoart.io: A data platform dedicated to the crypto art field. The company offers information about crypto art, crypto artists and macro crypto art data analysis.

Nonfungible: Data platform covering Ethereum NFT, including mainstream NFT projects in the market, historical and real-time NFT industry data, and NFT-related industry research.

NFTGuru: Tracking data using OpenSea APIs, featuring comprehensive search capabilities.

CryptoSlam!: Including the historical data of the transaction volume of the major NFT collectibles in different chains such as NBA Top Shot. But there is less data in the art world.

Application Layer -- Vertical Field -- "Curation and Community"

Community is driven by both intrinsic values (such as social status) and extrinsic values (such as future development). The curator's job is to create an ecosystem of harmony between these two motivations. One of the pain points for the average NFT creator is the inability to get initial traffic for their work. We're now seeing curators bundle premium services to build deeper relationships with their superfans. Therefore, curatorial projects can not only help NFT creators to sell themselves, but also find more potential value for users.

Whale DAO: Curated community, by issuing a community token, issue FT Token Whale based on pledged "valuable" NFT, as of July 7th, Whale asset pool is valued at $4.5m.

FlamingoFlamingo is a DAO organization that focuses on crypto art investment. Its members have the right to decide on the NFT art they want to buy together, and can split, borrow, mortgage, curate, etc. DAO purchased NFT. There are certain requirements to become a Flamingo DAO, you have to donate some ETH to become a member, and then there is a maximum of 100 members.

MetaPurse: Metapurse is a crypto community native venture capital fund funded by Metakoven that focuses on investing in crypto art, virtual assets and funding early stage projects. Different from other ROI-driven crypto funds, Metapurse aims to promote NFT ecology as its main goal. It recently curated an NFT VR exhibition to showcase its crypto purchases.

Friends with benefits: FWB is a private social platform based on Discord private server, bringing together a group of crypto creators and thinkers. Participants need to hold a certain amount of native token $FWB in order to join the social circle. $FWB has a constant supply of 1 million.

Collab.land: Collab.land is a Telegram Bot based solution to help crypto startups build early communities. For NFT creators, Collab.land will assist them in curating exhibitions where participants at different levels of the creators' community will present their own content.

Ark: ARK is an investment-oriented DAO organization for Cryptopunk. Members can create an ARK to gather other members to buy a specific Cryptopunk together, or participate in an ARK to get a share of the Cryptopunk purchased together.

Application Layer -- Vertical Domain -- "Social"

In my last post, we detailed our expectations for social platforms, which we see as an important medium for NFT's departure.

Nifty's: Nifty's is an NFT focused social media platform that connects premium publishers, brands, and creators with collectors, curators, and the fan communities that emerge around them. The innovation platform provides an easy-to-use interface that allows members to create, collect, discover and curate digital art and other collections in the NFT world. Using the technology of the MEME protocol, Nifty "S will provide creators with a premium, powerful, flexible and secure platform to launch their NFT.

Showtime: Showtime provides a social platform for crypto art creators to show their works, helping creators and crypto art investors find value.

Nafter: Nafter is a social platform that makes short content NFT. Similar to Instagram, creators can convert their posts to NFT and make a profit from selling the rights to view that post. Users can also pledge NAFT, the platform's native token, or a share of the content creator's revenue, to the personal account of their favorite content creator.

Only1: Only1 is a social media platform focused on NFT format content. Unlike content creators on NAfter who can sell an NFT to multiple people at the same time, Only1 auctions it so that only one person has ownership of the NFT. Users who obtain the ownership of the NFT content through auction can distribute the viewing rights of the content by charging the native token $LIKE.

The reason why we have conducted frequent research on NFT tracks recently is that we have seen the potential of NFT, whether from the transaction increment of the project side, user increment or the exploration on NFT by all walks of life outside the circle.

In the future, almost everything can be toked, and NFT can be seen as an open API interface that allows developers and users to unlock their creativity and create a limitless future. We look forward to being an important part of shaping that future.