Dotties has shown up to change the game of NFT trading on Aptos once and for all. As an NFT trader & enthusiast, you should know how Dotties affects you, how it works and what you can do to make the most out of it.
All of the above will be addressed in this in-depth introduction about Dotties. Let’s dive in.
How is Dotties different from other NFT Marketplaces?
How do you benefit from Dotties Swap as a trader?
The key selling point here for Dotties is that anyone can sell an NFT instantly. Dotties provides immediate liquidity for NFT traders, meaning that you will be able to exit your NFT position without waiting for a buyer.
Besides, there might be some unique sniping opportunities for traders. When you buy an NFT through Dotties, you get to pick from the pool which NFT you want. If someone mistakenly undervalues their NFT, you will be able to purchase it at the floor price.
How does liquidity for NFT work?
Automated market maker (AMM) facilitates swaps between NFTs and tokens (APT). In other words, you can trade your NFTs for tokens like APT without ever needing to find a buyer or seller. This provides you instant liquidity as an NFT trader and makes trading NFTs similar to trading any regular token on Uniswap/Pancakeswap.
If you ever used Uniswap for swapping tokens, you might be familiar with the concept. The price of tokens on Uniswap is determined by the AMM mechanism, if the token is bought, the price of the token will go up a certain percentage, the opposite will happen when the token is sold. With a fixed amount of buying/selling volume, bigger the liquidity, the smaller the change in pricings there will be.
So the question is, how do NFTs even have liquidity in the first place? (Make sure you already are familiar with AMM before diving further, please refer to this article for a full understanding)
There are 3 types of liquidity pools on Dotties: Buy-only pools, Sell-only pools, Buy-and-sell pools.
-
Buy-only-pools: Liquidity providers deposit NFTs into one pool and set the starting price they wish to sell their NFTs at. Every time an NFT is bought from the pool, the price of the NFT will go up by a flat amount (if the pool uses a linear curve), or a certain percentage (if the pool uses an exponential curve).
-
Sell-only-pools: Liquidity providers deposit APT into one pool and set the starting price they want to buy the NFT at. Every time an NFT is sold to the pool, the price of the NFT will go down by a flat amount (if the pool uses a linear curve), or a certain percentage (if the pool uses an exponential curve).
-
Buy-and-sell-pools: Liquidity providers deposit APT in one side & NFT collection of their choice in the other, and set the fee percentage that they would like to charge for every trade. Every time an NFT is bought from the pool, the price of the NFT will go up by a flat amount (if the pool uses a linear curve), or a certain percentage (if the pool uses an exponential curve) & vice versa.
About Linear/Exponential Bonding Curves
Linear
With a linear bonding curve, the price of an NFT is increased by a flat amount (called delta) every time an item is bought from the pool. Conversely, the price of the NFT is decreased by that same flat amount every time an item is sold to the pool.
Linear is most commonly used for a pool with a few NFTs and suitable for those who wish to purchase a small amount of NFTs (from 1 to around 3).
Exponential
With an exponential bonding curve, the price of an NFT is increased by a certain percentage (also called delta) every time an item is bought from the pool. Conversely, the price of the NFT is decreased equivalently every time an item is sold to the pool.
Exponential is most commonly used for a pool with a lot of NFTs and suitable for those who wish to purchase a considerable amount of NFTs (more than 5).
What's next?
All things considered, Dotties is the first to offer a unique and revolutionary protocol for the NFT ecosystem on Aptos, with the delivery of immediate liquidity, which is unprecedented within the NFT industry.
Dotties first free mint event will be announced soon.
In the meantime, join our crew3 campaign, claim your opportunity to receive amazing rewards. The higher your role on crew3, the higher the rewards.