• Home
  • Podcast
  • App
No Result
View All Result
Subscribe
×
sign in
  • Learn
    • All
    • Crypto Basics
    • Token Metrics Tutorials
    • Weekly Index Performance
    ocean-protocol

    Ocean Protocol Code Review

    Bitcoin: Everything You Need To Know

    Bitcoin: Everything You Need To Know

    What is Web 3.0? Everything You Need to Know

    What is Web 3.0? Everything You Need to Know

    NEW Token Metrics Crypto Market Indicators

    NEW Token Metrics Crypto Market Indicators

    Weekly Index Performance – May 26, 2022

    Weekly Index Performance – May 26, 2022

    NFTs Explained: What Are Non-Fungible Tokens?

    NFTs Explained: What Are Non-Fungible Tokens?

    Weekly Index Performance – April 27, 2022

    Weekly Index Performance – April 27, 2022

    When Does the Crypto Market Close?

    When Does the Crypto Market Close?

    Will Shiba Inu reach $1?

    Will Shiba Inu reach $1?

    • Crypto Basics
    • Weekly Performance
  • Market Analysis
    • All
    • Market Navigator
    • Market Update
    shanghai hard fork

    Shanghai Hard Fork – Investing Opportunities | Navigator

    The Bottom | Market Update

    The Bottom | Market Update

    The Metaverse Rally | Market Update

    The Metaverse Rally | Market Update

    The Dollar and DOGE| Market Update

    The Dollar and DOGE| Market Update

    Crypto Market Update

    Can Crypto Rally In October? | Market Update

    Crypto Rektember

    Can You Believe The Macro Shift ? Market Update

    Crypto Rektember

    From Rektember to a Brighter October | Market Update

    ethereum-its-time

    Ethereum: It’s Time | Market Update

    Europe is headed for a depression

    Europe is headed for a depression | Market Update

    • Market Update
    • Price Prediction
    • Market Navigator
  • Deep Dive
  • Hidden Gems
    • All
    • DeFi
    • Gaming and Metaverse
    • NFTs
    • Web 3
    Azuki NFTs

    Azuki | Hidden Gems – NFT

    LonelyPop

    LonelyPop, POTATOZ By 9GAG | Hidden Gems – NFT

    Moonrunners, Disco Kittiez | Hidden Gems – NFT

    Moonrunners, Disco Kittiez | Hidden Gems – NFT

    Evmos, Penumbra, Oasis Network | Hidden Gems – Web 3

    Evmos, Penumbra, Oasis Network | Hidden Gems – Web 3

    League Of Kingdoms, Aurory | Hidden Gems – Gaming and Metaverse

    League Of Kingdoms, Aurory | Hidden Gems – Gaming and Metaverse

    Orderly Network, zCloak Network | Hidden Gems – Web 3

    Orderly Network, zCloak Network | Hidden Gems – Web 3

    Sneakerheads, The Possessed NFT | Hidden Gems – NFT

    Sneakerheads, The Possessed NFT | Hidden Gems – NFT

    BitCraft Online, Earth from Another Sun | Hidden Gems – Gaming and Metaverse

    BitCraft Online, Earth from Another Sun | Hidden Gems – Gaming and Metaverse

    OnChainMonkey & RUNNER | Hidden Gems – NFTs

    OnChainMonkey & RUNNER | Hidden Gems – NFTs

    • DeFi
    • Gaming and Metaverse
    • NFTs
  • Code Reviews
  • Reports
    • All
    • Altcoin Quarterly
    • Awards and Ratings
    • News and Thought Leadership
    NFT Grade

    Introducing Token Metrics NFT Grade

    Token Metrics Research

    Introducing Token Metrics Research

    Research & Chill: 30% Token Metrics Discount

    Research & Chill: 30% Token Metrics Discount

    The Best Crypto News Sites of 2022

    The Best Crypto News Sites of 2022

    The Best Crypto Analysts

    The Best Crypto Analysts

    Token Metrics + CEX.IO Promotional Coupon

    Token Metrics + CEX.IO Promotional Coupon

    Partner plan

    NEW Token Metrics Partner Plan

    NEW Token Metrics Crypto Market Indicators

    NEW Token Metrics Crypto Market Indicators

    Best Altcoins of 2021 | Altcoin Quarterly Report | Q4 2021

    Best Altcoins of 2021 | Altcoin Quarterly Report | Q4 2021

    • Altcoin Quaterly
    • Moon Awards
    • News and Thought Leadership
  • TV
  • Learn
    • All
    • Crypto Basics
    • Token Metrics Tutorials
    • Weekly Index Performance
    ocean-protocol

    Ocean Protocol Code Review

    Bitcoin: Everything You Need To Know

    Bitcoin: Everything You Need To Know

    What is Web 3.0? Everything You Need to Know

    What is Web 3.0? Everything You Need to Know

    NEW Token Metrics Crypto Market Indicators

    NEW Token Metrics Crypto Market Indicators

    Weekly Index Performance – May 26, 2022

    Weekly Index Performance – May 26, 2022

    NFTs Explained: What Are Non-Fungible Tokens?

    NFTs Explained: What Are Non-Fungible Tokens?

    Weekly Index Performance – April 27, 2022

    Weekly Index Performance – April 27, 2022

    When Does the Crypto Market Close?

    When Does the Crypto Market Close?

    Will Shiba Inu reach $1?

    Will Shiba Inu reach $1?

    • Crypto Basics
    • Weekly Performance
  • Market Analysis
    • All
    • Market Navigator
    • Market Update
    shanghai hard fork

    Shanghai Hard Fork – Investing Opportunities | Navigator

    The Bottom | Market Update

    The Bottom | Market Update

    The Metaverse Rally | Market Update

    The Metaverse Rally | Market Update

    The Dollar and DOGE| Market Update

    The Dollar and DOGE| Market Update

    Crypto Market Update

    Can Crypto Rally In October? | Market Update

    Crypto Rektember

    Can You Believe The Macro Shift ? Market Update

    Crypto Rektember

    From Rektember to a Brighter October | Market Update

    ethereum-its-time

    Ethereum: It’s Time | Market Update

    Europe is headed for a depression

    Europe is headed for a depression | Market Update

    • Market Update
    • Price Prediction
    • Market Navigator
  • Deep Dive
  • Hidden Gems
    • All
    • DeFi
    • Gaming and Metaverse
    • NFTs
    • Web 3
    Azuki NFTs

    Azuki | Hidden Gems – NFT

    LonelyPop

    LonelyPop, POTATOZ By 9GAG | Hidden Gems – NFT

    Moonrunners, Disco Kittiez | Hidden Gems – NFT

    Moonrunners, Disco Kittiez | Hidden Gems – NFT

    Evmos, Penumbra, Oasis Network | Hidden Gems – Web 3

    Evmos, Penumbra, Oasis Network | Hidden Gems – Web 3

    League Of Kingdoms, Aurory | Hidden Gems – Gaming and Metaverse

    League Of Kingdoms, Aurory | Hidden Gems – Gaming and Metaverse

    Orderly Network, zCloak Network | Hidden Gems – Web 3

    Orderly Network, zCloak Network | Hidden Gems – Web 3

    Sneakerheads, The Possessed NFT | Hidden Gems – NFT

    Sneakerheads, The Possessed NFT | Hidden Gems – NFT

    BitCraft Online, Earth from Another Sun | Hidden Gems – Gaming and Metaverse

    BitCraft Online, Earth from Another Sun | Hidden Gems – Gaming and Metaverse

    OnChainMonkey & RUNNER | Hidden Gems – NFTs

    OnChainMonkey & RUNNER | Hidden Gems – NFTs

    • DeFi
    • Gaming and Metaverse
    • NFTs
  • Code Reviews
  • Reports
    • All
    • Altcoin Quarterly
    • Awards and Ratings
    • News and Thought Leadership
    NFT Grade

    Introducing Token Metrics NFT Grade

    Token Metrics Research

    Introducing Token Metrics Research

    Research & Chill: 30% Token Metrics Discount

    Research & Chill: 30% Token Metrics Discount

    The Best Crypto News Sites of 2022

    The Best Crypto News Sites of 2022

    The Best Crypto Analysts

    The Best Crypto Analysts

    Token Metrics + CEX.IO Promotional Coupon

    Token Metrics + CEX.IO Promotional Coupon

    Partner plan

    NEW Token Metrics Partner Plan

    NEW Token Metrics Crypto Market Indicators

    NEW Token Metrics Crypto Market Indicators

    Best Altcoins of 2021 | Altcoin Quarterly Report | Q4 2021

    Best Altcoins of 2021 | Altcoin Quarterly Report | Q4 2021

    • Altcoin Quaterly
    • Moon Awards
    • News and Thought Leadership
  • TV
No Result
View All Result
No Result
View All Result
Home Learn Crypto Basics

How to Short NFTs?

by Jacob Koch-Gallup
2023/01/16
in Crypto Basics, Learn
Reading Time: 4 mins read
0
0
SHARES
2.2k
VIEWS

After seeing the parabolic rise in the price of many NFT projects, you are probably wondering to yourself, “how to short NFTs?” Well, you are not the only one. A few protocols are currently developing derivative markets for the floor price of NFTs.

How Do You Actually Short NFTs?

Currently, there are no fully-developed products that allow you to short NFTs. 

In theory, you could borrow someone’s NFT, sell it at its current price, then buy it back once (if) it drops in price, return it to the original owner and keep the difference. This method, however, would never work. No one would let you borrow their NFT without a large amount of collateral, and the person who you sold it to could charge whatever they want because they would know that you are required to buy it back.

NFT Derivative Products in Progress

Mimicry

Mimicry is a fork of Synthetix protocol, a derivatives liquidity protocol for derivatives trading in DeFi, built on Polygon. Mimicry utilizes Mimics, fully-collateralized derivative tokens on Polygon that leverage oracles to mirror the floor price of one or more OpenSea NFT collections. By using a similar approach to Synthetix protocol’s pooled collateral model, Mimics can be traded with infinite liquidity and zero slippage.

how to short nfts

Anyone can use the Mimicry platform to mint new Mimics; however, investors must stake the native network token, $MIMIC, as collateral. Mimicry states in its white paper that Mimics are currently backed by an 800% collateralization ratio in order to absorb large price shocks. The collateralization ratio may be raised or lowered based upon community governance mechanisms. 

MIMIC stakers incur debt when they mint Mimics, and to unlock their MIMIC, they must pay back this debt by burning Mimics. This debt is not correlated with the original minted value but instead based on the exchange rates and supply of Mimics in the system. For example, if half of the Mimics in the system were Bored Ape Yacht Club Mimics (BAYCm), and BAYC doubled in price, then the system’s total debt and each staker’s debt would increase by one quarter.

Now for a real-life example to better understand the project. Suppose you want to mint a Bored Ape Yacht Club Mimic (BAYCm). If the floor price of BAYC was $250,000, then each new BAYCm token would require $2M worth of MIMIC collateral. If you did not have that much capital, you could instead mint ~0.00000050 BAYCm tokens by collateralizing just $1 worth of MIMIC. By mirroring NFT collections and creating ERC-20 tokens, investors will be able to short projects without actually borrowing any NFTs.

Mimicry is very early in its stages of development. Currently, the engineering team is working on forking Synthetix protocol. You may check out Mimicry’s website and whitepaper. 

NFTures

NFTures is a spin-off of SynFutures, a decentralized derivatives market platform designed for any blockchain. NFTures allows investors to short NFTs, individual or a basket of NFTs using leverage. Investors will use a single token to place their bets which is achieved through NFT fractionalization. To target more retail clients who know less about derivative trading, NFTures built the user interface to look similar to the Tinder dating app. 

NFTs

NFTures uses SynFutures’ existing synthetic automatic market maker (sAMM) model to match counterparties. SynFutures’ sAMM is a contributor to the market with an independent margin account that can create prices based on the constant product formula and its current position. This allows for constant liquidity, giving investors the ability to open futures contracts in a fully permissionless and decentralized manner. 

NFTures bases its contracts on spot price oracles, data feeds run by separate entities. NFTures will use decentralized exchanges such as Uniswap and SushiSwap and NFT fractionalization protocols such as Unic.ly and Fractional for its spot price oracles.    

NFTures – Short NFTs

Like Mimicry, NFTures is still under development. However, you may check out a sample of how NFTures will function on its website.

Tags: Crypto BasicsFree
Jacob Koch-Gallup

Jacob Koch-Gallup

Jacob Koch-Gallup, Investment Analyst & NFT Specialist at Token Metrics

Related Posts

Help

Market Landing Page Tutorial

January 6, 2023
NFT Grade
News and Thought Leadership

Introducing Token Metrics NFT Grade

August 18, 2022
Token Metrics Research
News and Thought Leadership

Introducing Token Metrics Research

July 9, 2022
Next Post
GoldFinch, Psyoptions, Exotic Markets, Shade/Silk, Friktion | Hidden Gems

GoldFinch, Psyoptions, Exotic Markets, Shade/Silk, Friktion | Hidden Gems

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

COMPANY

  • About Us
  • Contact Us
  • Privacy Policy
  • Sitemap

7600 Chevy Chase Drive, Suite 300, Austin, Texas, 78752, USA
Email: info@tokenmetrics.com | Tel: +1-888-908-6536

DISCLAIMER

Token Metrics Media LLC is a regular publication of information, analysis, and commentary focused especially on blockchain technology and business, cryptocurrency, blockchain-based tokens, market trends, and trading strategies.

Token Metrics Media LLC does not provide individually tailored investment advice and does not take a subscriber’s or anyone’s personal circumstances into consideration when discussing investments; nor is Token Metrics Advisers LLC registered as an investment adviser or broker-dealer in any jurisdiction.

Information contained herein is not an offer or solicitation to buy, hold, or sell any security. The Token Metrics team has advised and invested in many blockchain companies. A complete list of their advisory roles and current holdings can be viewed here: https://tokenmetrics.com/disclosures/

Token Metrics Media LLC relies on information from various sources believed to be reliable, including clients and third parties, but cannot guarantee the accuracy and completeness of that information. Additionally, Token Metrics Media LLC does not provide tax advice, and investors are encouraged to consult with their personal tax advisors.

All investing involves risk, including the possible loss of money you invest, and past performance does not guarantee future performance. Ratings and price predictions are provided for informational and illustrative purposes, and may not reflect actual future performance.

Copyright © 2022 - Token Metrics - All Rights Reserved

No Result
View All Result
  • Learn
    • Crypto Basics
    • Weekly Performance
  • Market Analysis
    • Market Update
    • Price Prediction
    • Market Navigator
  • Deep Dive
  • Hidden Gems
    • DeFi
    • Gaming and Metaverse
    • NFTs
  • Code Reviews
  • Reports
    • Altcoin Quaterly
    • Moon Awards
    • News and Thought Leadership
  • TV

Copyright © 2022 Token Metrics All Rights Reserved