The crypto winter breeze is blowing, and the DeFi community still hasn’t recovered from the Luna PTSD and Tornado Sanctions. Does the notion “bear markets are for builders” still hold when even NFT drops have used concepts over and over again?
Sudoswap recently announced its distribution of SUDO, the governance token of the sudoAMM protocol, a concentrated liquidity AMM protocol for NFTs. An initial supply of 60 million Ethereum-based SUDO tokens would be distributed to various project members. In the eyes of the community, Sudoswap is quickly transforming into the “it” place for NFTs these days.
Depending on the utility token members hold, they will receive a differentiating share of the SUDO drop. XMON holders will receive the lion’s share (41.9%) of the SUDO drop via a lockdrop event. While holders of the GA-generated oxmon NFTs will also receive 1.5% of the SUDO supply.
XMON holders may also choose to lock up their XMON to indicate their commitment. For every XMON locked up, users will receive 10,000 SUDO tokens. A small portion of Sudoswap’s SUDO supply would also be distributed to people who have provided liquidity for the platform in the past, luring speculators in and drawing even more liquidity to Sudoswap.
Taking a riff on Uniswap’s name, Sudoswap launched in July and uses an automated market maker to source and fund trades.
While Uniswap pools various token pairts, Sudoswap utilizes a similar mechanism and provides services for NFTs. It prides itself on being the first, honest-to-god, working decentralised NFT exchange with an on-chain automated market maker. It was created by the pseudonymous team of Statelauer, oxmons, oxHamachi, and BoredGenius.
The liquidity provided via the AMM in the Sudoswap protocol can be accessed by other protocols, dApps, and even marketplaces.
Holders can build pools that change the price of each NFT when the collection is purchased rather than displaying five different NFTs at the collection’s floor price. In contrast, traders can design “buy-only” pools that automatically purchase NFTs in a manner akin to dollar-cost averaging.
Creators get to be the artist, seller, and broker. In other words, the artist can take on the role of an entrepreneur by putting up liquidity, launching their project on Sudo, and taking the trading commissions from the pool. That may be more than they may get from a typical NFT sale.
Brentsketit’s Sudonauts was the collection that tried this method the most successfully thus far. Every sale of a Sudonaut NFT through Sudo’s AMM boosted liquidity to the pool, making the market more liquid and less volatile.
That’s fantastic for collectors since it gives them assurance that there will always be someone willing to acquire the collection, creating a safer and healthier market that is designed for longevity rather than being sentiment and hype-driven.