FloorDAO Provides Non-Floor Liquidity on Caviar

Note: Caviar Mid Tier pools are an experimental feature. Please take care and make sure you understand the risks of arbitrage before using them.

FloorDAO will be taking a historic first leap by seeding the first ever Caviar “Mid Tier” pool with a portion of the DAO’s Milady NFTs under management. Caviar users will now have the ability to trade Miladys that fall under the “Mid Tier” criteria in the same manner as trading a “Floor” NFT.

But what does this actually mean for NFT enjoyooors?

Whether in a traditional marketplace or on an NFT AMM, most NFT collections see a significant portion of their volume traded around the floor of the collection. These trades occur in various venues, both centralized and decentralized. For the longest time, an aspiring NFT collector could only trade floor assets on decentralized exchanges but with the introduction of Caviar, that is no longer the case!

Caviar accomplishes this by splitting a collection of NFTs up into different buckets and creating an AMM pool for each bucket. By using a “true value” classifier that takes into account various data points such as trait rarity, price estimates via data providers, and prior price history, the classifier is able to determine the desirability of the NFT relative to the rest of the collection. It then splits the NFTs up into different tiers: floor, mid, rare, and grail. Users can then buy and sell floor NFTs into the floor pool, mid NFTs into the mid pool, and so on and so forth.

Because each pool has its own independent xy=k curve, price of the mid pool functions independently from the price of the floor pool. Now, as long as there is consensus in the classifier doing its job correctly, true price discovery can occur for more than just the floor of a collection, and liquidity for non floor assets can be aggregated in a manner never seen before.

FloorDAO is excited to become the first Liquidity Provider for a Caviar Mid Pool! Follow along Discord | Twitter | Website