NFTs on Bonding Curves
Last updated
Last updated
The NFTs within the protocol are minted and traded on bonding curves.
That means that
unlike traditional mints, the mint-funds stay locked in a smart contract, providing liquidity and allowing community members to sell back their assets at any time
no listings and bids like on "traditional" NFT marketplaces are required.
The experience is similar to trading fungible tokens on Uniswap or other DEXs. You can trade at any moment because the bonding curve smart contracts hold the necessary liquidity to enable instant trades. This is also called "AMM", which stands for Automated Market Making.
Hint: You can transfer your NFTs to your Coinbase or Metamask wallet and trade them on regular marketplaces.
There are currently three different bonding curve options.
👉 Flat Bonding Curve: The price per NFT stays constant, independent from the minted supply. You can sell for the same price you minted, only the royalties/fee gets deducted.
👉 Linear Bonding Curve: For every minted NFT the mint price for the next NFT increases by a constant ETH amount. If you discover an NFT collection early and other people mint as well, you could sell your NFT for more ETH than you initially paid.
👉 Exponential Bonding Curve: Similar behavior as the `Linear Bonding Curve`, but the more NFTs are minted the higher the price increase per NFT minted.
First of all, the AMM model for NFTs allows us to reintroduce creator royalties. As long as the bonding curve is in range and the NFTs are not traded at prices higher than the maximum bonding curve price, there should be trades through the bonding curve. This is awesome for creators.