Proclamation of Non-fungible Contract

What is an NFC?

Non-Fungible Contract is the latest expansion of Dego.finance to its NFT Protocol and infrastructure.

Why do We Need a Mezzanine Market for Blockchain?

Since 2020, a black swan event in the global economy has become less of an anomaly. While the venture capital space stands a viable pool to digest oversupplied sovereign money, the liquidity drought remains rather hazardous for IPO or strategic acquisition exit routes for venture capitalists. This risk of liquidity shortage is likely to disrupt the venture capital space and hinder fundraising for start-ups.

Three Issues

Established financial markets is regulated hence relatively sound. A mezzanine market for Blockchain is problematic since the purchaser are buying the actual tokens, but futures delivers the tokens after lockup period, where three core issues arise.

Lack of Liquidity

When investing in the primary market, a large number of tokens in the hands of investors are locked up. Faced with the rapidly changing climate, they cannot respond in time, and it is easy to miss a trading signal since investors cannot transfer and circulate their stakes. When they finally receive these tokens, they often rush to dump and break the market liquidity, causing No-win situation for every stakeholder.

Cost of Friction

In 2017 and 2018, we witnessed numerous cases of agent deception, where an agent who claims to have allocation of a certain token and collect investment from investors, then do a runner and keeps the raise for himself. When an investor tries to transfer locked up stakes, it is generally hard to find a credible counterparty. Even if a counterparty is found, the transfer process is also full of surprises. These complicated procedures make it difficult for a mezzanine market to develop.

Room for Misbehaviours

Investors and project both suffers high frictional costs facing doggy middlemen. For investors, many project manages lockup stake is in a centralised way, even manually, which causes delay in token release, also trust issue between investors and the project.

Pioneering Financial utility of NFT assets

In the past, the price of an NFT is often determined by individual perception of beauty or value. Beeple’s masterpiece, auctioned for $60 million, “EVERYDAYS: The First 5000 Days” was well-recognised by a close circle of NFT connoisseurs, in a lack of consensus among the mass(crypto fundamentalists or in the established art space). These NFTs mostly fall in the category of Collectibles and Arts.

The Potential of NFT

Dego team has been focusing on exploring the combination of NFT + DeFi, so that NFT could unleash more possibilities. We believe that the financial and practical nature of NFT will be the future of blockchain. The shaping of Non-Fungible Contracts is another vital step we have taken. At present, almost everyone’s mind is imprisoned by “Intellectual Property” and “Arts”, which we fully respect, but we beg to differ with more innovation in the infrastructure and protocol layer.

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