CryptoShow: Bridging the "Last Mile" of NFT Core Value

Since entering the second half of 2021, in an environment where the overall cryptocurrency market continues to decline, the NFT sector, represented by blockchain games and the metaverse, has undoubtedly captured the market's attention. From the earliest NBA stars and Twitter founders to the recent launch of NFT auctions by the Coca-Cola brand… the support has led to astonishing prices for paintings, music, digital works, and gaming equipment, while also providing the market with limitless imaginative space.

The core lies in the fact that, as a completely different entity from traditional mainstream cryptocurrencies like Bitcoin and Ethereum, non-fungible tokens (NFTs) have become "value machines" that empower everything based on their unique characteristics of scarcity, indivisibility, and uniqueness. Although in the short term, NFTs mainly focus on the digital rights confirmation, circulation, and trading of virtual properties like gaming equipment and artworks, for the market, with the improvement of oracle systems, stocks, private equity, vehicles, real estate… will undoubtedly become the value space that NFTs will carry in the future.

However, before NFTs can truly bring about a disruptive transformation to the value system of the economic society, the market seems to need more projects to complete innovations and attempts to thoroughly resolve issues such as inefficiency, slow price discovery, concentrated pricing power, profit distribution, and full value realization. Recently, the emergence of "CryptoShow," a decentralized and permissionless NFT auction and custody trading platform, may provide innovative and iterative directions for the NFT market.

Why do NFTs have a broad market survival soil?

"Uniswap socks sold for $160,000, Twitter founder's five words auctioned for $2.5 million, and crypto artist Beeple's NFT auction piece at Christie's fetched a bid of $9.75 million…" In the eyes of many, the success of the cryptocurrency field in "breaking the circle" into the traditional capital market relies not on traditional mainstream crypto assets like Bitcoin and Ethereum, but on NFTs.

Cryptocurrencies are divided into two major categories: one is fungible tokens (FT) represented by BTC and ETH, which generally have their own main chains and use on-chain transactions to maintain ledger data, allowing FT tokens to be interchangeable and nearly infinitely divisible. The other is non-fungible tokens (NFTs), which have unique and indivisible characteristics.

It is evident that compared to FTs, the key innovation of NFTs lies in: providing an unprecedented ownership marker through a decentralized approach.

Therefore, what NFTs anchor is not the value itself, but the value relationship of information and items anchored on the blockchain. In other words, behind NFTs are "digital assets" issued on the blockchain, which can be game props, artworks, stocks, equity, real estate, and possess the same uniqueness and non-replicability as physical assets.

Based on their unique and indivisible characteristics, NFTs theoretically enable the tokenization of any valuable thing through ownership marking, allowing for the traceability of ownership of that information, thus achieving the intersection of information and value. With the rapid development of the digital economy globally, the digital form of all production and living elements is gradually becoming a norm, undoubtedly providing NFTs with infinite exploration space for the future.

"Essentially, NFTs create digital scarcity," said Arry Yu, chair of the Cascadia Blockchain Committee of the Washington Technology Industry Association and managing director of Yellow Umbrella Ventures. In fact, in the early stages of technological development, many NFTs already existed in some form as digital creations elsewhere, such as iconic video clips from NBA games that have been circulating as securitized digital art on Instagram.

However, merely locking the relationship between information and value through technology is clearly not all that NFTs encompass. The NFTization of asset ownership brings about a transformation in trading methods: achieving effective changes in ownership through a decentralized approach, completing the transfer and trading of asset value. It is precisely based on this that NFTs are hailed by the market as the next trillion-dollar blue ocean market that can rival the DeFi craze.

According to DappRadar data, in July of this year, the total number of users on the NFT trading market OpenSea exceeded 20,000, with a monthly trading volume exceeding $1 million. In the global market, the daily active wallets in the Ethereum NFT category grew by 350% in the third quarter compared to the second quarter, while trading volume increased by 57% year-on-year; compared to 2019, trading volume grew by 368%, reaching a historic high of $20 million.

From the user's perspective, they are not only buyers participating in the market but can also create customizable online stores as sellers to complete the sale of their NFT works. For example, Beeple completed the online auction of the first digital collectible "Everydays: The First 5000 Days" at Christie's, with a starting price of $100. After 220 bids, the final transaction price was approximately $69.3 million, setting a world record for digital art auctions.

Where is the final closed loop of the NFT "value machine"?

"Lowering the verification threshold before transactions, eliminating trust costs in transaction processes, while fully releasing its value liquidity, and ensuring the scarcity of its value in transactions." With the dual support of model innovation and conceptual innovation, NFTs are increasingly recognized by more players, and phenomenal application scenarios like the "metaverse" are also beginning new explorations based on NFTs.

However, through NFT transactions, completing the effective change of ownership that brings about asset value transfer has not yet fully formed a closed loop. Issues such as inefficiency, slow price discovery, concentrated pricing power, profit distribution, and full value realization in various transaction processes have become key constraints on the complete explosion of this "value machine." This is also why NFT auctions are hot, but actual trading volumes are far lower than various swaps.

Currently, most NFT trading platforms do not support users in fully defining transactions autonomously, including pricing, issuance, and auction formats. Specifically, the pricing power and issuance rights of NFT works are held by a few collectors and leading dealers, especially for some top NFTs, where ordinary players have almost no entry point for participation.

In addition, the NFT market is still in its early stages of development. If trading and liquidity issues cannot be resolved, further development will inevitably encounter bottlenecks, and the current market surge may very well become a fleeting moment. The most typical example is that current NFT auction transactions are mainly based on counterparty matching, requiring multiple parties to repeatedly quote, leading to low transaction efficiency and dispersed trading sentiment, resulting in a lack of liquidity and slow price discovery.

• For copyright owners, many NFT auction and trading platforms only support copyright owners to obtain income from the initial auction, but cannot gain revenue from the secondary market. In a sense, by replicating traditional auction forms, NFTs become a one-time, one-way copyright sale for copyright holders.

• For copyright purchasers, leading artists capture the vast majority of market profits, while high-quality long-tail works do not have the opportunity to be fully discovered. On the other hand, since the content and metadata represented by NFTs are stored separately from the smart contracts themselves, and because the content and metadata are large and cumbersome, they cannot be stored on the blockchain. Players find it difficult to effectively value NFT works, and there is no reliable price reference for NFT items, creating a high barrier for traditional art investment enthusiasts.

These issues mean that the current NFT trading field still heavily relies on the "fan economy" model of the internet era. For example, those with a large number of followers on Twitter, Instagram, or YouTube, as well as those with higher community activity, are likely to have the opportunity to reach more potential customers and gain more first-mover advantages.

However, what the market ultimately focuses on is the value anchored by NFTs themselves, and what users ultimately care about is the returns and experiences, not just the hype. Therefore, to form the final closed loop of the NFT trading market, bridging the "last mile" of the trillion-dollar market still requires continuous iteration and attempts around "value-driven" approaches.

The CryptoShow NFT auction and custody trading platform, combining financial logic and model innovation, brings the possibility of breaking through bottlenecks to the market.

CryptoShow is an NFT auction and custody trading platform based on BSC, supporting the buying and selling of digital assets under BEP-721 and BEP-1155 standards. Users can empower and trade assets through pricing issuance, various forms of auctions, NDR, AMM, and other methods, along with various liquidity enhancement solutions.

CryptoShow's innovative model bridges the NFT trading closed loop

In CryptoShow's NFT assetization solution, it creatively splits the traditional NFT trading process into three stages: NDR custody → public issuance → private invitation.

Copyright holders can use NDR (NFT Depository Receipt) on CryptoShow to custody NFTs and split them into multiple standard BEP20 protocol NDRs, which will be priced in the market through AMM.

This can be simply understood as a market-oriented indirect issuance method for NFTs. CryptoShow first custodies the NFTs and generates a certain number of transferable agreements (NDRs) before conducting market transactions.

Its greatest advantage lies in neutralizing the challenges posed by the indivisible nature of NFTs in market transactions, solving the problem of copyright holders being able to conduct only one-time copyright sales, while also allowing ordinary investors the opportunity to participate in the market trading of high-quality NFTs, effectively eliminating the market pain point of top NFTs being controlled by a few collectors and leading dealers.

From an overall design logic perspective, the initial liquidity of NDRs comes from issuance and ends with the establishment of private invitations. While ensuring liquidity, AMM employs a classic inverse price curve, effectively ensuring broad pricing.

In this process, the NDRs generated based on the initial NFT protocol will go through two core stages: "public issuance" and "privatization."

In the "public issuance" stage, the number of NDRs will be determined and issued. The number of NDRs will be determined based on the number of participating addresses at the time of issuance. After confirming the quantity, NDRs can be issued through various methods such as whitelist acquisition, ascending price auctions, and capital share subscriptions. During this period, CryptoShow will retain 10% of the auction amount and NDRs as part of the initial liquidity plan.

In the "private invitation" stage, the final transfer of NFT ownership is effectively completed. Users holding sufficient collateral can propose private invitations for the NFTs corresponding to the NDRs. It is worth noting that private invitation prices can only be proposed if they exceed 120% of the proposed price. If the NDRs' quotes do not maintain above 95% of the invitation price within the shortest specified period, the privatization is deemed invalid. If the NDR quotes meet the requirements during the invitation period, privatization is established, and the privatization amount will be fully paid to the holders of the NDRs.

It can be said that in the innovative NDR model, the two core links of public issuance and private invitation effectively address many pain points such as price discovery, repeated quoting, inefficiency, and lack of liquidity, buffering the opportunity for high-quality long-tail works to be fully discovered by the market. The latter returns to the logic of NFT ownership transfer and allows NFT market prices to approach the value they carry: issuers gain higher returns, players obtain reliable price references and valuations, and it objectively lowers the barriers for traditional art investment enthusiasts.

In summary:

• Upgrade the issuance method to a fairer pricing method, transforming traditional single-point bidding decided by a few into multi-point continuous bidding.

• Fragment the minimum trading unit, providing traders with opportunities to participate in the pricing of top artworks.

• Provide sufficient pricing references for investment collectors, allowing traditional investors to enter the NFT investment and collection field more.

• Provide various works with ample pricing and growth opportunities, allowing emerging independent authors to have better opportunities for value discovery of their works.

• Amplify issuance value, allowing copyright holders to gain continuous full-chain revenue.

Overall, CryptoShow's product design integrates all mainstream product functions, including NFT asset auction platforms (minting, publishing, auctioning, transferring), NFT assetization solutions (public issuance and private invitation based on NDRs), mining, crowdfunding, etc., which can be applied to the most market-promising sectors such as crypto collectibles, crypto artworks, virtual space control rights, identity/rights certification, and game props based on the BEP-1155 protocol.

Finally, let's take a look at CryptoShow's ecological incentive token SHOW. The initial total issuance of SHOW is 1 billion. Among them: seed round 5%, strategic round 13%, IDO-ascending price auction 2%, LP/trading/single coin/fragmented LP mining pool 40%, NDRs trading/liquidity rewards 18%, community activity treasury 10%, team incentives 10%, liquidity reserve 2%.

It is worth mentioning that in the future, each NFT public issuance will have 10%-20% of the quota exclusively for SHOW holders, and SHOW is also the only revenue reward in the CryptoShow ecosystem. Holders will have the right to make various governance decisions for the community, and in the future, SHOW will also upgrade to mint as a BEP-1155 Token linked to NDRs trading.

In conclusion, regarding the core value of NFTs

At this point, let's return to NFTs themselves. Currently, NFTs are still in a relatively early stage. The NFT + IP art route is still the prevalent route, just as artworks need to return to value. The combination of NFT + finance is most likely to break barriers and has the greatest opportunity to transfer the entire economic volume of the traditional world onto the blockchain, ultimately achieving asset digitization.

And this is the core value of NFTs. Just like CryptoShow's proposed NDR-public issuance-private invitation NFT assetization solution, there are similar projects or solutions proposing fragmentation. The financialization of NFTs requires breakthroughs; it is not just about increasing liquidity. It is about promoting a new worldview, namely that NFTs are not just artworks but also data and finance, gradually forming a complete financial system.

We believe that with projects or solutions like CryptoShow exploring and attempting more possibilities, bridging the last "mile" of NFT assetization will undoubtedly promote the prosperous development of NFTs.