Digital native collecting as a collective comes with its own set of challenges and unsolved problems. 1OF1 was designed from the ground up and aims not only to improve the execution, governance, and acquisition process of scarce digital assets, but also to solve the challenges around exhibiting, financing and valuing the collection. Some early experiments include:
Valuation
An important part of operating a collector club is the ability to consistently and fairly value assets, both to determine the current NAV (Net-Asset Value) of the portfolio, but also, more importantly, to be able to take in contributions in form of NFTs from artists or fellow collectors. This is a crucial exercise because it will allow the 1OF1 community to onboard other thoughtful collectors with rare pieces that add value to the capital pool via accretive transactions.
Striking NAV of subjectively priced assets is a notoriously difficult exercise. We developed The NAVgator as a first attempt to create a tool that can give a more nuanced and informed overview of pricing, specifically for large edition NFT series. More information at https://www.theorbacle.com/
For unique works or low-count editions, the tokens usually don't have many overlapping traits. This means that each work or edition needs to be assessed separately and on its own terms, here the driving factor of prices are: recognition of artist and individual piece, art historical importance, provenance, museum and curatorial support, collector base, subject matter, and many other factors. This makes it rather difficult to use an automated or algorithmic approach for pricing. Therefore we work with the market data that is available, have works priced by professionals or crowdsourced appraisals such as Abacus.wtf.
Striking NAV of subjectively priced assets is a notoriously difficult exercise. We developed The NAVgator as a first attempt to create a tool that can give a more nuanced and informed overview of pricing, specifically for large edition NFT series. More information at https://www.theorbacle.com/
For unique works or low-count editions, the tokens usually don't have many overlapping traits. This means that each work or edition needs to be assessed separately and on its own terms, here the driving factor of prices are: recognition of artist and individual piece, art historical importance, provenance, museum and curatorial support, collector base, subject matter, and many other factors. This makes it rather difficult to use an automated or algorithmic approach for pricing. Therefore we work with the market data that is available, have works priced by professionals or crowdsourced appraisals such as Abacus.wtf.
Lending and yielding
1OF1 scouts, risk asses and executes upon a large variety of novel yielding strategies. Thus for the first time, unlocking the full DeFi composability potential of NFTs and maximizing the capital efficiency of otherwise idle assets. Each guild is exploring diversified sources of yield for sustainable returns, which include
1OF1’s Art Guild pioneers digital art lending, which is only available to the best work at the intersection of web3 and the traditional art market. Taking a low loan to value debt position on parts of the 1OF1 portfolio is the first step towards making the assets in 1OF1 yield a return. These funds are deployed into Dialectic’s Chronograph, our in-house delta neutral stable coin yield farming fund, with a targeted APY of 15-25%, which helps us maintain and grow the collection at a steady pace.
- Market Making on MetaFi protocols such as NFTX, Seaport and upcoming options markets
- Harvesting Metaverse native resources through Play-To-Earn gaming assets such as virtual Lands and in-game Characters.
- DeFi delta-neutral yielding with stablecoins borrowed against the fine-art portfolio and blue-chip collectibles with Pwn.Finance and other platforms.
- Lending Gaming assets to Active P2E Guilds to play in P2E games thereby generating compelling yield.
- Active risk management lead by Dialectic
1OF1’s Art Guild pioneers digital art lending, which is only available to the best work at the intersection of web3 and the traditional art market. Taking a low loan to value debt position on parts of the 1OF1 portfolio is the first step towards making the assets in 1OF1 yield a return. These funds are deployed into Dialectic’s Chronograph, our in-house delta neutral stable coin yield farming fund, with a targeted APY of 15-25%, which helps us maintain and grow the collection at a steady pace.
Compliance
1OF1's Swiss AG wrapper ensures compliance. With our optimized legal structure and bespoke Freeport storage solution for physical art and NFTs, we ensure minimal taxation across the collection for members.
Wen DAO?
To align with Web3 values and entrench 1OF1 in the zeitgeist of the digital world, transitioning 1OF1 into a DAO and decentralising the governance is the mid to long-term goal. We will be thoughtful about this approach and will wait until the 1OF1 organization has some maturity and governance is trending to be removed from daily execution. This will result in an easier transition from private collection to DAO. As governance by decentralized means is a relatively new approach, foundational groundwork should be set in place to increase the success of the final outcome, and before projects move towards this.
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