- Advertisement -

Ask someone what NFT is and they will instinctively think of digital art – CryptoPunks, Bored Apes and Ether Rocks that have been sold for mind-boggling sums.

- Advertisement -

In some quarters, non-fungible tokens are dismissed as a vehicle for speculation, with critics lamenting that demand for such assets is fueled by greed.

- Advertisement -

But this argument does not give us the full picture. We’re barely scratching the surface of what these one-of-a-kind tokens can achieve, and new use cases are constantly emerging.

The music industry is tentatively exploring what NFTs have to offer. Live Nation, one of the world’s largest entertainment companies, has begun offering digital versions of ticket stubs, giving fans virtual mementos of the concerts they’ve attended. Other platforms allow consumers to invest in new music and receive a share of the royalties. TV shows and movies are also funded through NFTs – and despite the backlash from gamers, game brands are also dabbling in the technology.

NFTs can also improve existing crypto services, one of which is DeFi. What if this technology could be used to unlock access to certain restricted services… and could we see popular crypto collectibles widely used as collateral?

While the “NFTification” of the decentralized sector is seen as inevitable in some crypto circles, there are some hurdles that need to be overcome. Let’s explain why.

NFT is worth the mint

Any discussion of what is preventing NFTs from playing a larger role in the DeFi ecosystem must inevitably start with the cost of minting such tokens.

Even in a secure Layer 2 network, transaction fees mean that creating, distributing, and trading NFTs is often not profitable. This, in part, explains why these cryptographic collectibles are so prohibitively expensive, not to mention why new uses for non-fungible tokens are being explored very slowly.

As traders look forward to the launch of the Ethereum Proof-of-Stake network, this blockchain has become inaccessible to many ordinary users. While faster, cheaper, and scalable competitors have emerged in recent years, some have suffered repeated outages that have cast doubt on their reliability.

But what if users could be offered a completely gas-free experience during transactions? Could this be a silver bullet that draws tens or hundreds of millions of users into the space – people who will be attracted to the development that it will encourage?

Such an approach would be beneficial for both the NFT and the DeFi sector, giving crypto enthusiasts the freedom to transact the way they want without worrying about cost. But from an infrastructure standpoint, there are other issues to consider.

Innovation in DeFi

Currently, high gas fees mean that trading and farming is not financially viable for small users, while slow bridges connecting the Ethereum mainnet to Tier 2 are frustrating. The DeFi space has also shown a lack of stickiness, with users often moving from platform to platform in search of the best short-term opportunities.

Of course, an even bigger barrier has to do with getting people to see what decentralized protocols and automated market makers (AMMs) have to offer. Poor user experience and more complex features on centralized platforms often don’t give investors much incentive to move to DeFi. The downside here is that consumers end up relinquishing control of their own cryptocurrency.

But it doesn’t have to be this way — and one team says it built the first NFT-based AMM that was designed “from the ground up to address a number of critical issues for DeFi.”

Product Gem

Ruby.Exchange builds its infrastructure on SKALE, which is described as a powerful multi-chain solution for Ethereum. SKALE networks have zero gas cost and boast a fast, decentralized and secure bridge to the main network where transfers in either direction can take minutes instead of hours or even days.

And while the value of NFTs may be uncertain due to their limited uses, Ruby offers gems — “beautiful, generative works of art that inspire loyalty by embodying real utility as well as artistic value.” These assets play a major role in her AMM.

This exchange claims to provide a feature-rich and gaming user experience where NFTs are minted for user profiles, as trading fee rebate vouchers, and to ensure that customers can access the premium features they expect – among They have built-in charts and advanced analytics. . Increasing yields is another use case.

Moreover, the gamified trading and farming experience provides that subtle “stickiness” that DeFi protocols currently lack—rewarding long-term participation and benefiting all users by helping to prevent capital from migrating elsewhere, which impacts liquidity.

In the future, new classes of NFT gems will be created – and as the Ruby analytics and liquidity provider control panel is created, owning non-fungible tokens will be the key to unlocking access.

In their early days, NFTs and DeFi showed great promise, reshaping the worlds of art and finance. Now Ruby.Exchange is determined to show how powerful the “NFTification” of decentralized finance can be.

Learn more about Ruby.Exchange

Denial of responsibility. Cryptooshala does not endorse any content or product on this page. While we strive to provide you with all the important information we can obtain, readers should do their own research before taking any action related to the company and take full responsibility for their decisions, and this article should not be considered investment advice.