Spores Resolution to NFT Market Limitation
It is undoubtful that NFT is making a disruption in creative & gaming industries, potentially in many other fields in a near future. However, we should point out several challenges to the development and adoption of NFTs at presence. To enable the development of NFT applications, there are a number of important barriers which need to be overcome. Several remarks should be liquidation, infrastructure problems, user experience, regulation, bridging the gap between the centralized and decentralized world
Centralization vs Decentralization. Mik from Crypto kitties pointed out that the distinction between the online and offline world is increasingly blurred, as more and more people are choosing to spend most of their lives online and, in many cases, in virtual worlds. Whilst this is certainly the case, there is still a huge divide between the decentralized and centralized realms. Many non-crypto-native NFT projects will struggle when it comes to bridging the gap between the relatively self-governed decentralized realm and the centralized realm which is bound by various rules and regulations.
Illiquidity & fragmentation. Unlikely fungible tokens (e.g. ERC-20 types), NFTs have low liquidity due to their scarcity and rarity nature. In addition, NFTs are fragmented on many marketplaces without a seamless connection. Contrasting to rather mature cross-chain wrapping protocols for most crypto assets, NFT owners cannot sell their Ethereum-based NFTs for BEP-20 USDT without an intermediary.
Scalability & transaction fee. The development of NFTs is heavily dependent on underlying blockchain infrastructure. Solving for scalability and transaction fees, for instance, is likely to have a huge impact on the speed of development of this space. Alongside this, the lack of accessibility when it comes to NFTs is a real problem. Lili, Co-Founder at Cryptodecks and designer by trade, discussed this in detail. Particularly for non-crypto natives, interacting with decentralized ecosystems entails a large amount of friction. From having to manage your private keys, to paying several gas fees per transaction and having to set up a new wallet each time, there are so many barriers to entry. Cryptodecks is tackling this problem by providing a simple interface for users to interact with their NFTs.
Shared ownership issue. Whilst many people view NFTs as a way of creating new financial assets and democratizing access to capital, regulation will most likely act as a barrier to this. For instance, Codex might use NFTs as a mean to fractionalize ownership of a piece of art or we could consider fractionalizing ownership of a property. Whilst this is interesting in theory, there is a risk that doing so would turn these tokenized assets into securities and they would, therefore, need to be regulated accordingly.
How SPORES solves the problems
Spores’ ultimate goal is to build a full-stack NFT platform, consisting of an NFT minting portal and a marketplace for trading NFTs, supported by cross-chain interoperable decentralized finance protocols, which is feasible to solve the aforementioned limitations of NFT space. A full-stack decentralized NFT finance platform is in urgent need for both vertical and horizontal application scale up, as analyzed by Rachel M. [4]. We target bridging the three major blockchains (Ethereum, Cardano, BSC and Polkadot) for frictionless NFT minting and exchanging. Furthermore, Spores marketplace is blockchain-agnostic and friendly for everyone to join. Services offered by popular decentralized finance (DeFi) protocols (e.g. wrapping, atomic swaption, staking & lending) are sophisticatedly integrated on the whole Spores platform to improve NFT liquidity to allow seamless capital access for the new class of crypto assets. DeFi users join Spores’s NFT marketplace with gamification of staking, collateral dept positions, farming and more.
Simply, ones can see Spores as a full combination of an NFT minting platform, a marketplace and a DEX for NFTs. The foundation team of Spores Network believes that the composition and complementation of NFT and DeFi will bring a significant progress for the crypto space, making it more applicable in real world. Readers may find projects proposed the nexus between NFT & DeFi.
