Dapp of the week: NIFTEX



Learn how to create & trade ERC20 NFT Fractions

Updated: NIFTEX has found a “potential vulnerability” in part of its code and is currently “on hold” for two weeks while it fixes it. All NFTs are safe and locked down in the meantime.

Enabling the interoperability of blockchains is an increasingly vital part of building out a vibrant and optimized ecosystem.

The introduction of Bitcoin as a collateral element within the Ethereum DeFi sector has been one key element, for example. 

But even within a blockchain, allowing assets to flow more efficiently is gaining momentum. 

One novel but a fascinating example is the NIFTEX dapp

Simply put, it enables the owners of high-value NFTs such as digital art, in-game items, or land parcels to sell off a minority share of that asset.

This is important because such high-value NFTs are generally hard to resell as there aren’t many people with either the inclination or the financial ability to spend thousands of dollars on such digital items.

https://www.youtube.com/watch?v=zFXPtVrlbbI

However, NIFTEX enables the fractionalization of NFTs, which just means the NFT (which uses the ERC721 Ethereum standard) is locked within its smart contract, and a minority shareholding is created in the form of standard ERC20 tokens. 

In this way, someone with an NFT worth for example 100 ETH, could choose to turn 40% of that value into 400 ERC20 tokens each worth 0.1 ETH (or 4,000 tokens worth 0.01 ETH, etc). 

Traders interested in owning a small part of this high value NFT can then buy some tokens, which because of their use of the ERC20 standard, can then be traded on standard exchanges such as Uniswap. 

After only a couple of months of operation, over 20 NFTs have been sold in this way on NIFTEX, with the majority of their tokens – so far- rising in value. 

Neatly you can track the highest value NFT ERC20 tokens on DappRadar’s new ShardMarketCap website.

https://www.youtube.com/watch?v=iLFCjk8wqWY

At the time of writing, the best performing tokens are Axie Infinity character Hauteclere – up 206% – giving the asset a market cap of almost $37,0000, and digital artist XCOPY’s Evader – up 180%, with a market cap of $6,650. 

Of course, always remember such dapps are highly experimental in nature, and things can go wrong. Certainly, you shouldn’t use NIFTEX in the expectation of making money. And you should never use more value than you can afford to lose.

As always we will continue to monitor developments as they unfold. For now, make sure to bookmark DappRadar. Sign up to our newsletter to receive regular updates directly to your inbox.

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