E8 NFT-Index Operating Model Explained
NFT-Index Operating Model:
NFT-Index Protocol is an important component of E8 platform. The above image illustrates the operating model of E8 NFT-Index.
Index token is a fungible token used to measure the total market cap of NFT assets on E8 platform. The value of Index token is calculated based on the verified NFT value, historic trading price, and data of other dimensions.
Index token’s real-time value is correlated with a set of dynamic data through activities such as NFT redemption, NFT auction, etc.
Index tokens can be instantly swapped via third-party DEX.
The Main Characteristics of E8 NFT-Index:
Above image shows the structure of the NFT-Index System. The total circulating supply of Index token is adjusted through activities such as NFT pledge and redemption, which is realized via the Reserve pool. When new NFT asset enters the Index pool, more Index tokens are released from the Reserve. Index token circulating supply increases.
To apply for NFT redeem and auction, users need to deposit Index token to the platform. After the auction completes, Index token circulating supply decreases.
Different from NFT fractionalization/shares, the pledged NFTs on E8 platform can be re-privatized for the next trade.