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New project puts NFT investing on autopilot Automated market maker positions NFTs as tradable assets

The financialization of NFTs continues.

The latest development is the deployment of an automated market maker (MA) called sudoAMM, specially designed for NFT trading. It is planned for the mainnet of Ethereum and is designed to be an infrastructure for other NFT projects.

“We are testing in prod atm for the [user interface]0xmon, the project’s co-founder, told The Defiant. The pseudonymous developer post a transaction on Twitter, which used the Contract deployed April 24.

Bond Curve

Gem, an NFT aggregator that OpenSea acquired this week, has already integrated sudoAMM contracts, according to to the main developer of the aggregator called Vasa.

SudoAMM allows users to deposit either ETH, NFTs of a certain collection, or both, with a custom bond curve. This allows users to set up limit orders by deploying ETH in a pool with an on-chain commitment to buy NFTs from a specific collection at a chosen price.

Similarly, users will be able to deposit NFTs of a selected collection, sell the tokens at a fixed price or with a bond curve. It is a mathematical characteristic that increases the price of each subsequent purchase.

The different possible bond curves that depositors can choose from. Source: Oxmon’s Blog

0xmon described the basic sudoAMM model in more detail in a blog Publish. The co-founder compared sudoAMM to Uniswap V3 in that it allows liquidity to be deposited in personalized price ranges.

SudoAMM will allow entire NFTs to be traded, which means that only NFT “whales” will be able to provide significant liquidity on their own. Still, sudoAMM is designed to be permissionless, which means developers can leverage its smart contracts and potentially aggregate individual pools from one NFT collection into a larger one.

This hits a key element of sudoAMM – the protocol is likely to be used as infrastructure for other NFT projects. CometShockwriter and frequent DeFi commentator, gave The Defiant the example of Yuga Labs, the company behind Bored Ape Yacht Clubdeploying a marketplace specifically for its NFTs.

“The Official BAYC Marketplace might even have fancy branding and be a closed source to prevent social engineers from forking and scamming,” CometShock said.

Inescapable solution

The author also believes that, given ample liquidity, sudoAMM will allow for more accurate pricing of NFTs. This in turn could allow people to borrow against their NFTs, hence financialization.

No project has truly established itself as the go-to solution for NFT collateral, as the non-fungible nature of the token makes them difficult to value and borrow.

SudoAMM is part of an ecosystem of crypto products that include sudoswapwhich allows users to trade any combination of ERC20 and ERC721 (NFT Token Standard) tokens, and 0xmonsthe NFTs generated with neural networks.