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  • How Gamification is Changing Crypto

    How Gamification is Changing Crypto

    Making the cryptocurrency industry more approachable is an ongoing challenge. However, the advent of gamification, play-to-earn gaming, and NFTs has brought much more mainstream attention to this segment. Any platform innovatively embracing gamification can make a lasting impact. 

    Gamification Matters To Crypto

    Even though cryptocurrency has tremendous potential in the financial sector, that might not be the industry of interest for mainstream users. Financial matters are something most people either ignore or try to circumvent in whatever way possible. That is a bit problematic for the companies and projects pursuing opportunities in decentralized finance, as they will – most likely – only attract existing crypto users rather than those who have a pressing need for these products and services.

    Changing that narrative requires a very different approach to bringing crypto services to the world. Gaming represents an excellent opportunity, as it is a far more popular industry than finance. Unfortunately, most public blockchains will not scale properly to accommodate any gaming endeavors, creating another bottleneck to resolve. Although networks like Cardano, WAX, Solana, and others provide far better scaling, 

    Gamification of blockchain technology presents new exciting opportunities, but it may not necessarily trigger a major shift. Play-to-earn gaming attracts many people to this industry, as they see opportunities to make money. GameFi, the gamified version of decentralized finance (DeFi), seems to have a similar effort, although it is still a bit too early to say. The ongoing growth of metaverse technology can bring more people into the fold, but only if the correct infrastructure is built to accommodate millions of users. 

    Thankfully, that necessary infrastructure is currently in development across major blockchains. Surprisingly, it will not be Bitcoin or Ethereum that will bring the essential solutions to the table. Like the ones mentioned above, other blockchains note an influx of new projects that can help make gamification the catalyst to bring the mainstream into cryptocurrency and blockchain. 

    Gamification Examples Available Today

    While some people may think the future of gamification will not happen until a few years, things look very different today. Numerous projects have gaming elements to bring their product or service to the market. Outside of play-to-earn gaming, there are also solutions like NFTs unlocking virtual avatars or items for virtual avatars, providing access to gaming environments, and more. 

    However, the concept goes much further than that. Decentralized finance platforms make a concept like yield farming, staking, and liquidity provision much simpler and more accessible by adding game-esque elements to them. It makes DeFi more accessible to newcomers who are not familiar with these concepts, yet they can see the benefits of clicking on a website’s section to earn money or collect rewards. 

    Even in the decentralized exchange industry, gamification is taking hold. AdaSwap, the ecosystem builder on the Cardano network, supports various use cases, including serving as an AMM DEX. All of its core functionality is accessible seamlessly, and users will have fun swapping tokens, supplying liquidity, and experimenting with non-fungible tokens. Combined wth low trading fees, a referral program, and stake-and-forget functionality, AdaSwap removes many headaches newcomers would face otherwise when entering the crypto space. 

    Closing Thoughts

    Gamification changes the way people think about topics that might otherwise make them uncomfortable. No matter how important, financial matters make people’s skin crawl, as we prefer not to think about these things. However, it is not something to avoid forever either, and gamifying elements of [alternative] financial concepts can make these matters much more approachable. 

    It is a welcome change to the overall cryptocurrency industry. Decentralized finance, DEXes, and other solutions can change the lives of millions of people, yet they often only cater to those who are entrenched in cryptocurrency already. That is now what these initiatives were about, and gamification may be the catalyst to enable mainstream adoption of crypto and blockchain in the coming years.

  • Blockchain Fest 2022: The Tradition of Crypto Community Takes Singapore

    Blockchain Fest 2022: The Tradition of Crypto Community Takes Singapore

    Date – June 2-3, 2022

    Venue – Marina Bay Sands, Singapore

    https://blockchain-fest.asia/

    Blockchain Fest 2022 is no doubt becoming a good crypto tradition with FINEXPO stepping out to Singapore in 2022. This June luxurious and the most iconic Singaporean Marina Bay Sands will welcome the crypto community with its leading figures and top professionals. As usual, top expertise, networking and learning are the key elements with a lot more expecting every visitor who joins the event in Singapore. 

    Blockchain Fest is not a debutant as it already took place in Singapore twice and in Limassol, Cyprus last year and happened to be a great success. It wouldn’t be a lie to say that this show is creating a whole new routine for the blockchain community with invited leaders, business flow, expo spaces and informal parties.

    2022 promises to be even better with several events of Blockchain series both in Cyprus and Singapore as the organizing committee follows all the necessary preventive COVID measures to make the experience for attendees as safe as possible. Visitors are invited to safely attend the best conference and panel discussions, network and discover the industry from an insider perspective.

    The Singapore event has a lot of potential since the city state is becoming a real crypto hub and has already attracted crypto giants such as Gemini and Binance, not to mention that Singapore is a recognized global wealth hub. It might also be noted that this is not the first time Finexpo organizes a blockchain-related show there – Crypto Expo has made history and apparently intrigued the public to the tee.

    The upcoming event zone will be complemented by the conference and some networking spaces to create wonderful opportunities for everyone in the venue to both learn and connect. Traditionally topics for panel discussions and workshops include Blockchain, Exchanges, Cryptocurrencies, Decentralized Finance (DeFi), NFTs, Mining, Gaming and Gambling, Online Payments and Investment.

    The exhibition floor filled with booths from leading companies, networking spaces for meetings accessible for Business and VIP ticket holders and a gala night party creates a seamless networking flow and makes the event like no other. By the way, Crypto Awards are again, a part of this event as the voting has already opened and all visitors get an opportunity to even meet a company or a person live at our event before voting for them in the first honest rating of crypto projects, companies and persons based on feedback and reviews from real users and customers.

    You can explore more opportunities with our wonderful upcoming event at https://blockchain-fest.asia/. Tickets are already available on the website with an early bird discount until the end of February and include online, standard, business and VIP packages. 

    About the organizer

    FINEXPO aims higher with its events creating phenomenal shows and substantial series all over the world including Singapore, Malaysia, Philippines, Thailand, Vietnam, South Korea, South Africa, Egypt, Ukraine, Russia and Cyprus. Networking and learning are the key elements everywhere you go with FINEXPO. Every event produced by FINEXPO has its unique touch of perfection yet common sense for every person in the industry.

    Contact Blockchain Fest at 
    laura@finexpo.org
    +357 95536475
    Laura Mirnaya
    PR

  • Bitcoin Lost 20% in January as Macro Drivers Contributed to Risk-Averse Investment Climate

    Bitcoin Lost 20% in January as Macro Drivers Contributed to Risk-Averse Investment Climate

    Key takeaways:

    • Bitcoin has lost more than a fifth of its value during January 2021, as traditional expansionary assets also faced notable downward movement
    • At its lowest point during the first month of 2022, the price of Bitcoin was 52% removed from last November’s all-time high
    • Bitcoin’s poor performance can be attributed to a series of macroeconomic factors, highlighted by a tightening of the money supply announced by the Fed

    The start of 2022 was a turbulent ride for the blockchain industry – the value of Bitcoin and other digital assets has shrunk by high double digits. The combined valuation of all digital currencies in circulation fell to $1.75 trillion at the end of January, just two months after the historic milestone of $3 trillion was breached last November. 

    Macroeconomic drivers, not poor fundamentals, have led to Bitcoin’s subpar performance

    The beginning of this year was characterized by a series of macro drivers that have had a major impact on the price of expansionary assets, including cryptocurrencies. The spread of the coronavirus “Omicron” variant, rising tensions on the Russia-Ukraine border, and a tightening of monetary supply by the Federal Reserve have contributed to a notably risk-averse environment.

    Bitcoin, S&P 500, and NASDAQ have all experienced a notably lousy start to the year. Image source: Grayscale, Bloomberg

    The initial announcement of the interest rate hike at the beginning of the month led to Bitcoin and a large number of other digital assets shedding over 10% of their value in the span of 24 hours, after trading in a relatively tight range for a couple of weeks prior to the sudden drop.

    January’s second notable market pullback, which pushed the total market cap below $2 trillion, started on Friday, January 20, and lasted for a couple of days. The call of Russia’s central bank for a blanket ban on crypto coincided with the market drop, but it is difficult to say how much of a role it played. Russian tech and political leaders quickly dismissed the proposed ban, fearing such legislation could have a devastating effect on the Russian IT sector.

    Bitcoin finished January with a price decline of more than 20%.

    At the time, Bitcoin fell to the $32,000 level, which many analysts identified as the local bottom. Shortly after, key market indicators turned green, and Bitcoin swiftly recovered a large chunk of its lost value and began a steady rebound, which saw its price reach $37,700 at the time of this writing. 

    One important on-chain metric that points to a potential market trend reversal is Bitcoin miners’ unwillingness to sell their digital holdings. According to blockchain analytics firm CryptoQuant, miner reserves have reached their peak 12-month value at the tail end of January 2022. BTC miners sit on a stash of 1.86 million BTC, worth more than $70 billion at current market rates. 

    Bitcoin miners have been reluctant to sell their holdings despite massive price swings. Image source: CryptoQuant

    Final thoughts

    Generally speaking, the world’s largest crypto seems to be in a state of limbo – its market performance appears to be almost entirely dependent on macroeconomic factors outside the domain of blockchain technology. It is worth noting that periods of significant market drawdowns had historically presented some of the best buying opportunities. For instance, Bitcoin had lost more than 80% between Dec. 2013 and Jan. 2015, and Dec. 2017 and Dec. 2018, and both times pushed to a new all-time high once the markets eventually recovered.

    Buy/Sell BTC
  • Popular Singapore Startup Affyn Raised Over US$20 Million to Build a Play-to-Earn Metaverse for the Digital Future

    Popular Singapore Startup Affyn Raised Over US$20 Million to Build a Play-to-Earn Metaverse for the Digital Future

    Singapore, Singapore, 31st January, 2022, Chainwire

    Singapore-based startup Affyn raised over US$20 million through several fundraising rounds, including the recent round led by several launchpads.

    This comes directly after a successful presale round that raised US$10.4 million. This back-to-back successful fundraising round indicates a high level of anticipation for its Play-to-Earn Metaverse.

    Affyn is a blockchain-powered Metaverse project with a Free-to-Play, Play-to-Earn mobile game that integrates the best of both the virtual world and the real world. Utilising geolocation technology, augmented reality (“AR”) mechanics and blockchain technology such as non-fungible tokens (“NFT”), Affyn aims to create an ecosystem that is fun and practical, both virtually and in real life.

    Building a Sustainable Game Economy

    The Affyn team spent over a year to develop a closed-loop ecosystem that places sustainability at the forefront of its game economy. In contrast to many other projects in the Play-to-Earn category, Affyn places heavy emphasis on envisioning an ecosystem with a broader long-term view in mind. Creating a system with multiple revenue streams that includes an advertising revenue model and business-to-business collaboration, Affyn is positioning itself as one of the pioneers of building a mobile Play-to-Earn model that is sustainable.

    Users can also catch glimpses of the NEXUS Metaverse on Affyn’s social media in the coming months as they reveal their “Buddies” – a collection of NFT characters in the game. A trailer video of the NEXUS Metaverse is set to be released in February.

    Company founder and CEO Lucaz Lee

    “We would like to thank our partners, advisors, investors and community for the tremendous support and trust in Affyn. Our successful fundraising campaign signals strong confidence in the vision of Affyn’s Play-to-Earn Metaverse. 2022 will be unprecedented as we ignite the tech space by ushering in a new era of Metaverse. We will pioneer the first of its kind Play-to-Earn Metaverse that encapsulates the fabric of reality into a synthetic world where the notion of a real-world is represented by digital avatars, NFTs and assets. We would like to invite you to join us in this Metaverse where we can play, earn and have more fun together at the same time.”

    About Affyn

    Affyn is a Singapore-based company building a blockchain-powered Metaverse project with a Free-to-Play, Play-to-Earn mobile game with integrated geolocation where the virtual and real-world converge. Making use of geolocation technology and AR mechanics, Affyn incorporates the fun element of gaming with blockchain technology such as the utility of NFTs.

    https://affyn.com/
     

    Contacts
    • Tammie Chew
    • tammie@affyn.com
  • Ariva (ARV) Announces Milestone Partnership with World Tourism Forum Institute (WTFI) and Global Tourism Forum (GTF)

    Ariva (ARV) Announces Milestone Partnership with World Tourism Forum Institute (WTFI) and Global Tourism Forum (GTF)

    Ariva, a next-generation tourism & travel blockchain protocol, has announced a partnership with World Tourism Forum Institute and Global Tourism Forum. This is a significant development and will place Ariva at the forefront of the tourism industry.

    Ariva reveals key partnership

    Ariva will be leveraging its collaboration with World Tourism Forum Institute and Global Tourism Forum to position itself as a leading blockchain service provider in the global tourism sector. World Tourism Forum Institute will also serve as a bridge between Ariva and the global tourism industry. In addition, the organization plans to create fund the Ariva ecosystem with $50 million in two years. 

    Ariva expects the partnership to enable ARV to become a globally accepted cryptocurrency. It would also achieve its aim of fostering blockchain use within the tourism community. 

    As part of the partnership, the three organizations will be working together on several projects and initiatives. Furthermore, Ariva and WTFI will host the first forum that will bring together crypto professionals. WTFI experts scheduled ‘Global Tourism Forum Leaders Summit – Blockchain for Travel’ for March 2022 in Dubai. The event details will be shared with the public in the coming weeks. 

    A major milestone for Ariva 

    Ariva’s partnership with the World Tourism Forum and Global Tourism Forum is huge for the blockchain project. Since its launch in the second half of 2021, the blockchain project has focused on crypto adoption in the tourism sector. 

    Ariva is also developing an inclusive ecosystem that will cater to the needs of the travel and tourism industry. Its ecosystem is divided into key areas – Ariva.Club, Ariva.Finance and Ariva.World. 

    Ariva recently launched Ariva Wonderland, a metaverse project that aims to introduce tourists into a world with limitless travel experiences. Land sales in the metaverse are scheduled to begin in early February via an auction system. 

    About Ariva

    Ariva is a blockchain ecosystem dedicated to building innovative products for the tourism and travel industry. Its ecosystem is fueled by the ARV coin, a BEP-20 token that serves as a payment and utility token within the Ariva ecosystem. You can learn more about Ariva by visiting the website https://ariva.digital/

    About World Tourism Forum Institute (WTFI) 

    World Tourism Forum Institute is a London-based institution at the forefront of fostering new solutions and ideas for the tourism industry.  As the leading international tourism development and investment brand, World Tourism Forum Institute is committed to promoting developing countries in the field of tourism development, economic growth, foreign direct investment through tourism investments, and human resource development within the industry. You can learn more about WTFI by visiting the website https://worldtourismforum.net/ 

    Global Tourism Forum (GTF)

    The Global Tourism Forum, or GTF for short, is an international collaboration platform focused on addressing the challenges for the travel industry. Combining the joint efforts of government agencies, industry stakeholders, and academia, GTF strives to achieve sustainable development models for emerging travel markets and devise strategies to ensure tourism growth.

  • FTX Hits $32 Billion Valuation on the Heels of $400 Million Series C

    FTX Hits $32 Billion Valuation on the Heels of $400 Million Series C

    Key takeaways:

    • A leading cryptocurrency exchange FTX raised $400 million during its Series C fundraising round led by Temasek and Paradigm
    • The exchange has reached a $32 billion valuation, surpassing the market cap of some of the biggest publicly traded companies in the world
    • Last week, FTX US, the American-based arm of the international FTX exchange, raised $400 million in Series A at an $8 billion valuation

    The FTX cryptocurrency exchange has announced the close of its latest funding round, during which the rapidly growing digital asset trading platform raised $400 million from a series of high-profile investors.

    With a $32 billion valuation, FTX is now bigger than Philips and Twitter in terms of market cap

    The Series C fundraise saw participation from notable venture capital firms, such as Temasek, Paradigm, and SoftBank. The close of the latest funding round comes roughly a week after the exchange’s American arm, FTX US, announced a $400 million haul in its first-ever external fundraising round. At the time, President of FTX US Bret Harrison stated that Series A reflected “both what we’ve concretely accomplished and what we’ve laid the groundwork for in 2022.”

    According to Monday’s press release, most investors who participated in previous FTX funding rounds have contributed to the Series C as well, showcasing their “belief in the Company’s vision.” Sam Bankman-Fried, the founder and CEO of FTX, commented on the success of Series C: 

    “Our Series C financing round represents a milestone achievement for FTX, as we raised close to $2 billion in six months. This round will support our continued mission of delivering innovative products and services to the marketplace as well as expanding our global reach with additional licenses around the world.”

    Bankman-Fried added that the exchange will continue working with policymakers and financial watchdogs to “ facilitate access to digital assets in a safe and compliant manner.” In pursuit of this goal, FTX US has recently inked a sponsorship deal with Washington-based sports organizations, which the exchange hopes will help increase its favor among the US regulators.

    FTX concluded its Series B round last October – with more than $420 million raised, the company’s valuation reached $25 billion at the time. As a side note, and to illustrate how far along the industry has progressed in just a few years, Coinbase’s Series E netted the first US publicly traded exchange $300 million, which pushed the valuation to $8 billion at the time. Today, Coinbase (COIN) trades at roughly $182 per share, good for a market cap of $39.1 billion.

    With its current valuation of $32 billion, FTX enjoys a larger market cap than some of the most prominent tech companies globally, such as Dutch tech conglomerate Philips ($28.4 bln) and social media giant Twitter ($28.2 bln).

    FTX’s native exchange token FTT gained more than 3.5% on the news and set a new cycle high of $42.72 at press time. FTT gained more than 33% in the last seven days and is currently one of 2022’s biggest gainers in the cryptocurrency top 100.

    Create FTX Account
  • Unizen to Establish CeDeFi Alliance, a Non-Profit Advocacy Organization Fusing the Best Features of CeFi and DeFi

    Unizen to Establish CeDeFi Alliance, a Non-Profit Advocacy Organization Fusing the Best Features of CeFi and DeFi

    Key takeaways:

    • In Centralized Finance (CeFi), users must give custody of their funds to a trusted organization such as a bank or a centralized cryptocurrency exchange
    • Decentralized Finance (DeFi) eliminates the need for middlemen in financial transactions as in DeFi the transactions rely solely on technological solutions such as self-executing smart contracts running on a public blockchain
    • The soon-to-be-established CeDeFi Alliance aims to combine the best of both worlds by bringing together DeFi projects and CeFi institutions
    • The non-profit organization advocating for CeDeFi services will put great focus on their regulatory compliance

    Centralized Finance (CeFi) is the legacy financial system

    Let’s face it, centralized finance (CeFi) is the legacy financial architecture. The main characteristic of CeFi services is that they are run by centralized entities, such as banks, hedge funds, corporations, etc. Even though most blockchains are decentralized, there are many centralized companies operating in the cryptocurrency space that belong to the CeFi category – think of centralized exchanges (CEXs), centralized lending service providers (BlockFi, Nexo), and a vast number of other firms offering CeFi services to the crypto-savvy audience.

    While CeFi solutions often offer higher liquidity, better user interface, and more flexibility (e.g. cross-chain exchange options), they do come with one big trade-off. Users of CeFi services need to entrust their funds to the company offering the services, which puts them at risk of losing their funds, should the organization that has custody of the funds go bankrupt, get hacked, or even misuse the funds and act against customers’ best interest.

    Decentralized Finance (DeFi) replaced the “trust in people” with “trust in technology”

    While the development of blockchains gave us the possibility to transact digital assets without a trusted middleman it is the smart contracts that made it possible to utilize these digital public ledgers for more complex value transfers, such as those in trading, lending, borrowing, or even insurance deals. Self-executing smart contracts thereby removed the need for a centralized institution acting as a middleman in these deals.

    The “trust in people” (also trust in organizations) has been replaced by the “trust in technology”, which is the biggest pro of decentralized finance (DeFi), as its users don’t need to give up custody of their funds at any point. Furthermore, the DeFi sector is a place where very rapid innovation takes place. On the other hand, DeFi products are generally unregulated and the chance of having your funds stolen through exploited smart contract vulnerabilities is also a legitimate concern that should not go mentioned.

    While the term DeFi was coined in 2018, the first platform with characteristics of a DeFi product, MakerDAO, was established already in 2017. DeFi’s popularity grew significantly throughout 2020 and in 2021 DeFi emerged as a serious competitor to CeFi solutions. According to DeFi Llama, almost $190 billion worth of digital assets is locked in various DeFi protocols today. In addition, many industry insiders believe that DeFi will steal a large chunk of the market share from CeFi in the forthcoming years. 

    Centralized Decentralized Finance (CeDeFi) combines the best of both worlds

    Centralized Decentralized Finance is an innovative financial system that aims to fuse the best features of CeFi and DeFi. The ideal CeDeFi product, therefore, has the liquidity and ease of use of the CeFi, while also enjoying the security of the DeFi which minimizes the trust that must be placed in the centralized entity by removing the need for asset custody. The goal of CeDeFi is to make crypto assets accessible on the large scale and drive the wide adoption of blockchain through close collaboration between DeFi projects and CeFi institutions.

    Unizen will set up CeDeFi Alliance, a crypto non-profit that will accelerate CeDeFi development and adoption

    Unizen, a fully compliant cryptocurrency exchange that combines the features of CEX’s and DEX’s to meet the needs of both retail and institutional traders, has announced that they will establish CeDeFi Alliance – a non-profit organization that will seek to unite decentralized teams and centralized decision-makers. Unizen representatives hope that the two, typically opposing sides, will come together within the Alliance to discuss proactive cooperation.

    Besides creating a partnership network, the Alliance will also lobby for CeDeFi’s interests with key stakeholders in the industry in order to grant its members unique institutional and governmental opportunities. However, for CeDeFi solutions to be used in these environments, the financial products need to be regulated and fully compliant with local laws and regulations, which is why discussions with the market regulating authorities will be on the top of the Alliance’s task list.

    While the Alliance will primarily focus on financial solutions, the team will be on the lookout for innovative use cases of the centralized-decentralized approach in other industries as well. The press release notes:

    “Blockchain and digital assets have the potential to disrupt multiple fields if centralized and decentralized players can find common ground for such partnerships.”

    Jun Capital helps Unizen fund the CeDeFi Alliance

    Unizen has also revealed that they have secured funding for the new CeDeFi Alliance from a leading crypto technology investment firm Jun Capital, which will also become a key member of the newly founded organization. However, the Alliance is not the first joint venture of these two organizations. Jun Capital and Unizen have already established themselves as drivers of the CeDeFi ecosystem as they have set up the first CeDeFi incubator – the ZenX incubator.

    While the ZenX incubator helps teams with the development, promotion, and deployment of their CeDeFi projects from the technical and practical point-of-view, the CeDeFi Alliance will help the incubated projects in terms of complying with theoretical frameworks and regulations. In conclusion, should the CeDeFi Alliance live up to its full potential, we could soon be seeing rapid growth in the number of deployed CeDeFi solutions and their users. 

  • WhiteBIT Cryptocurrency Exchange Enters the Metaverse with TCG World

    WhiteBIT Cryptocurrency Exchange Enters the Metaverse with TCG World

    You have probably already noticed how the metaverse is getting more and more popular every day, accelerated by Facebook’s strategic move to rebrand to Meta and develop their own metaverse.  We are entering into a generational shift, people are buying virtual land for large sums of money, and big brands such as Nike & Adidas are on their way to developing virtual spaces in blockchain based games such as The Sandbox and Decentraland.

    TCG World, a metaverse project in which everything that the player owns exists on the blockchain, recently announced a partnership with WhiteBIT who will become the first cryptocurrency exchange to build their virtual office in the TCG World Metaverse.

    WhiteBIT is amongst the top global exchanges on CoinCheckup and supports USD, GBP and EURO in over 190 countries with a user base in excess of 1,000,000. The metaverse will provide WhiteBit a new opportunity to connect with customers and players through the experiences developed on their virtual land. Players will be able to view charts, trade on the exchange in-game or visit their auditorium for live news feeds & streams as well as other unique experiences developed by the team.

    To accompany the partnership, TCG World released a cinematic trailer of WhiteBIT’s virtual office in the Metaverse. The trailer takes you on a cinematic tour of their virtual building in the snow covered north region of TCG World and offers players an early glimpse of the metaverse development and graphics. TCG Worlds partnered YouTuber Ryan Patrick also provides an insightful reaction video on the latest trailer release.

    With the game set to go live in Q3 of 2022 for community testing, players are excited to jump into TCG World. You can join its popular Telegram or Discord communities in preparation for the release. Further information can be found over on the official website, where virtual land is currently on presale.

  • Wash Trading Accounts for Over 80% of Transaction Volume on OpenSea Rival LooksRare

    Wash Trading Accounts for Over 80% of Transaction Volume on OpenSea Rival LooksRare

    Key takeaways:

    • LooksRare is a new NFT marketplace that launched at the beginning of 2022
    • The LooksRare team admitted to wash sales taking place on its platform and called the practice “genius”
    • Arguably the largest NFT marketplace, OpenSea, has had a considerably lower transaction volume in January compared to LooksRare, despite OpenSea having its best month to date in January 2022

    The LooksRare non-fungible token (NFT) marketplace has made quite an entrance onto the digital collectibles space – in the first few weeks since its launch, LooksRare cleared triple the amount of transactions volume of the world’s largest NFT market, OpenSea. However, the vast majority of trading volume can be attributed to the practice known as wash trading.

    LooksRare surpassed OpenSea’s NFT trading volume thanks to wash trading

    Wash trading is a process of repeated buying and selling to create artificial activity in the marketplace in hopes of driving up the value of assets. Blockchain analytics firm DappRadar first reported on the unusual activity taking place on LooksRare in mid-January, the first week into the NFT marketplace public operation.

    Earlier in the month, LooksRare retweeted a message stating that the act of wash trading is “by design” and that “it’s genius.” Unlike OpeaSea, which charges a 2.5% fee on each transaction, LooksRare charges 2% on basic sales and zero percent fees on private NFT items. The fee structure has undoubtedly played a vital role in driving up the transaction volume as most NFT collections exchanging hands in recent wash trading have been traded without royalties.

    Another important thing to consider is that LooksRare incentivizes trading on its platform with crypto rewards. Users can earn the platform’s native LOOKS tokens based on their share of the total daily volume traded on the marketplace. LOOKS can be also be staked in exchange for WETH rewards, which further increases their usability and income-generating capabilities.

    According to NFT analytics firm CryptoSlam, approximately $8 billion of LooksRare’s total sales volume in January can be attributed to wash sales.  

    LooksRare cleared roughly $9.2 billion in trading volume between January 12 and January 28, according to data compiled by Dune Analytics. In that same time span, only 15% of the total volume could be considered as organic activity.

    It is worth noting that OpenSea beat its previous trading volume, user activity, and fee-generated records in the first two weeks of January – despite this fact, OpenSea trailed far behind LooksRare in terms of transaction volume on its platform in the same time span.  

    The dollar value amount of transactions and user numbers on OpenSea and LooksRare. Image source: Dune Analytics, @elenahoo

    It will be interesting to observe how the wash trading saga pans out. While some members of the crypto community find wash trading detrimental to the organic growth of the sector, there are many who believe that was LooksRare is doing is smart and volume spikes are beneficial to everyone. 

    A renewed interest in NFTs, the spike in sales, and the growing presence of institutions in the space have pushed the NFT sector to new heights in the first month of 2022 and is on pace to dramatically surpass the previously record-breaking 2021. For reference, the NFT market generated roughly $23 billion in trading volume throughout last year.