NFTs have been slowly developing from a socially-interesting trend to an established asset class. Nonetheless, structural and conceptual issues — such as being mostly based on Ethereum’s PoW network thereby resulting in high gas fees, or being perceived as a means to obtain unrealistic economic returns — have slowed the realization of NFT potential. For NFTs to improve and claim their rightful place as the building blocks of the next financial ecosystem, they need a solid basis. We are talking, of course, about liquidity. Inherent to their unique nature, NFTs have had a hard time enjoying the benefits of fungible assets — interchangeability, divisibility, liquidity, and more.
The THEOS ecosystem comprises a variety of features and functionalities. As initially developed in our whitepaper, THEOS will be equipped with four main products; the Minting platform, our ODYSSEY and DELPHI pools, and Auctions. ODYSSEY pools are at the center of the Theos.fi ecosystem, materializing the idea behind true liquidity for NFTs, and will be the next part of our ongoing MVP launch.
Experimenting with NFT liquidity
The same idea that separates us from other players in the NFT space is the one that results in a not-so-intuitive understanding of our product. While some mechanisms are being created to bring liquidity for NFTs — such as collateralized NFTs, partial liquidity hubs through similar-NFT pools, and more — there is no established mechanism that can do so.
We believe that our ODYSSEY NFTIZE pools will turn out to be not a marginal improvement of an already-developed asset class, but the concept that will defy the way we think about liquidity. They have come to transform the experience of NFT trading in a similar manner as Uniswap did to liquidity pools. Simply speaking, Uniswap enabled a User-to-Protocol shift, discarding the need for centralized exchanges that enable P2P trading. ODYSSEY pools can therefore be considered as the Uniswap of NFTs, enabling a User-to-Pool NFT trading — inherently eliminating the need of a peer counterpart to carry out an NFT trade. Now you can ‘sell’ an NFT to an ODYSSEY pool.
ODYSSEY NFTIZE Pool Walkthrough
Initially, ODYSSEY pools will be permissioned, which means that pool originators will be required to accept NFT submissions from other users. The process involves the following steps:
1. ODYSSEY Pool Creation
The role of Pool Originator (PO) is assigned to those that create an ODYSSEY pool and define a number of parameters, such as:
- Token name and symbol
- NFT base price or ‘V’
- Social cause and
- Limit of NFTs in the pool (if desired)
Requirements
For creating an ODYSSEY pool, the PO will need two things: An originator NFT, and a bag of $THEOS tokens.
A pool of fungible tokens will be created and will issue tokens as more NFTs are accepted and deposited into the pool. The initial amount of $THEOS tokens will depend on the base price set for NFTs, and will be used to fund a liquidity pool for those pool tokens — thereby making the PO the first Liquidity Provider.
Note: The process of creating both the ODYSSEY pool and liquidity pool happens in one transaction.
2. NFT Deposit
Once the pools are created, users will be able to submit their NFTs to become a part of the ODYSSEY pool of their choosing, and -if accepted- receive the base amount of pool tokens— resulting in instant liquidity. NFT depositors can, however, place an optional markup value ‘i’ that will only receive if someone else buys that NFT from the pool.
Note: Users will be able to submit both NFTs minted on THEOS as those minted on other platforms, and will have several ways of accessing them throughout the platform.
Note: The price obtained by depositing an NFT into a pool will vary depending on the market price of the pool tokens of each pool.
3. Sell or Withdraw your NFT
The counterparts of the deposit flow are buying/withdrawal flows. Essentially, in order to buy an NFT — thereby utilizing an ODYSSEY pool as a marketplace —, a user must acquire ODYSSEY pool tokens in the secondary market. For example, let’s say Matt Sorum has a pool and accepts several NFTs in it. If anyone wants an NFT that belongs to that pool, they are going to need to buy the NFT price of $MATT tokens from the liquidity pool.
4. Price and fee distribution
A part of the total price paid by the NFT buyer will be distributed among other actors in the pool, including:
- Original NFT Minter. In certain cases, a percentage may correspond to the minter through royalties included at the moment of minting. Royalties are displayed in the detail of each NFT.
- Social causes. For ODYSSEY pools with social causes, a predetermined percentage of the selling price will be redirected to the social cause, and the proceeds will be used to fund special projects.
- NFT Seller. The NFT depositor -now seller- will receive a share of the total price paid (V + i) for the NFT. Basically, the seller will receive the remainder of the total price minus the aforementioned fees and the V price — which was initially received as instant liquidity when the NFT was deposited into the ODYSSEY pool.
- ODYSSEY Pool Originator. While no fees will be distributed to POs at the MVP stage, POs will be allowed to set a determined percentage of NFTs selling price to be distributed to themselves.
Note: THEOS will not be adding a THEOS fee on ODYSSEY pool transactions at the first MVP stage. However, it is possible that a small fee is added in the coming iterations to support the project’s development.
ODYSSEY pools were designed to issue pool tokens each time an NFT gets accepted -and deposited- within the pool, and send said tokens to the depositor. Nonetheless, as we also created the possibility of selling within pools, we encountered a double charging of the NFT price. In order to account for this, we determined that the NFT seller only gets the difference between the price sold and the liquidity originally obtained. The V amount of pool tokens will not go to the seller but will be burnt in order to control for limitless pool tokens supply.
We are aware of the complexities that innovation may bring, and we are determined to assist our community every step of the way.
About THEOS: The THEOS ecosystem is managed and sustained by our Association, a team of both traditional finance and blockchain virtuosos. We envision a new way of thinking, minting, and trading NFTs, and have developed what we believe is going to become the next-generation community-governed NFT platform. THEOS will become the first NFT platform in Cardano, the blockchain with the highest potential out there.
Follow our social media channels to stay up to date with the latest news:
- Telegram Announcements — https://t.me/theos_fi_announcements
- Telegram Official Community — https://t.me/theos_fi
- Twitter — https://twitter.com/theos_fi
- Discord — https://discord.gg/aMdWsXFzBt
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