From PFPs to Generative Art, NFTs adoption has seen exponential growth during the rampant frenzy generated in 2021, bringing a massive influx of new retail interest. However, it still represents a thin layer of how deeply the fundamentals of NFTs technology can be explored and leveraged.

In its turn, rather than being designed as a blockchain-based digital collectible, artifact, or artwork, Financial NFTs are designed to carry some underlying financial utility or application, instead of having the visual output and traits rarity as their main product. The Financial NFTs can include everything: from bonds and security-based swaps to baskets of tokens.

Addressing the potential of leveraging the fundamentals of NFTs technology as a key pillar, we’re introducing Aliquo, a decentralized reserve asset protocol on the Ethereum blockchain. Community-governed, the mission of Aliquo is to create, issue, and maintain the consistency of AQ1, the protocol-native token.

AQ1 is an ERC-721 token collateralized 1:1 with a 0,1% stake in the AQ1 Vault, fully backed by ether; with a hard-capped supply of 1,000 NFTs.

Through AQ1, Aliquo comprises existing mechanisms widely adopted by the crypto market (e.g., royalties over secondary sales, token-gated community, decentralized organization, multi-signature wallet) to present an ERC-721 token structured on underlying financial features: Royalties as Liquidity (RaL), Reserve-Backed, Proof of Value (PoV), Protocol Ensured Value (PEV), Non-Inflationary, and Free-Floating.

Materializing the core utility of AQ1, Aliquo aims that the protocol-native token can function as a decentralized reserve asset that accrues earnings from royalties as backed value, enabling AQ1 to retain or increase its purchasing power over time, rather than depreciate; the primary fundamental of a reserve asset.

The Aliquo approach introduces a flywheel mechanism that makes the protocol collect the earnings from royalties over secondary sales of AQ1 to reinvest in underlying assets, which become accrued as backed value for the NFTs themselves. Those underlying assets are allocated to a multi-signature protocol reserve called Aliquo Treasury, which is safeguarded and managed by Aliquo DAO — a decentralized organization of AQ1 token-holders. In its turn, AQ1 Vault is fractionalized in a fixed number of stakes with a theoretical ratio of 1:1 between the stakes and the AQ1 token supply, on which the supply cap (1,000) is the coefficient of the number of stakes, and each resulting stake (0,1%) collateralizes 1:1 the backed floor price of each AQ1. In other words, AQ1 Vault collateralizes AQ1 with a theoretical ratio of 1:1 between the vault's assets value (100%) and the token supply cap (1,000).

Aliquo’s flywheel provides a long-term, virtuous cycle of compounding the backed floor price of AQ1: as much more AQ1 becomes traded, more earnings from royalties the protocol accumulates as backed value to AQ1 itself. Hereupon, the key point of compounding the floor price of AQ1 is that as much more the backed floor price increases, it proportionally leverages how much 10% from royalties fees equals in each secondary sale of AQ1; then, reflecting on the posterior protocol revenue and the next cycle of compounding.

Distributing 100% of the protocol’s decision-making power in favor of the community, Aliquo is fully run by Aliquo DAO. The primary responsibility of the DAO is to maintain the consistency of AQ1 by dictating and safeguarding the Aliquo Treasury, which includes the AQ1 Vault. The membership of Aliquo DAO is based on holding 0,1% of the total supply of AQ1 (i.e., 1 of 1,000 NFTs). Permissionless, anyone holding at least one AQ1 is allowed to join Aliquo DAO and participate in shaping the protocol’s future.

The fair public launch of AQ1 occurs in Q1 2023, marking the first iteration of Aliquo on the Ethereum Mainnet. Empowering the protocol decentralization since its inception, the tokenomics of AQ1 proposes a public event where the entire token supply of AQ1 (1,000) is offered, with equal opportunity to everyone, from everywhere.

If it got your interest, join us, and let’s carve out the future of Aliquo and AQ1 together.

For further understanding about Aliquo, we recommend reading our whitepaper and documentation.