BlockTalks x DROPS AMA Transcript!
Hello! BlockTalkers & Blockchain Enthusiastic!
We recently hosted an AMA with DROPS, on April 15th at 12.00 PM UTC. Many of you might have participated or many of not. But we make sure no one missed out from the knowledge shared by Darius Kozlovskis, Founder of DROPS. So here we are up with the AMA transcript, for those who missed the live session, this blog post will be a saver & feeder of knowledge for them.
Introduction Questions Asked By Team BlockTalks!
Q1. Could you please introduce DROPS to our community in layman’s term?
Ans — Drops is a platform that will bring more value to NFT holders, by allowing to stake NFTs and farm NFTs like game items etc. Also use NFTs for instant liquidity and loans. On top of that we will enable users to earn yield from NFTs in vaults.
We believe DeFi solutions around NFTs might even surpass DeFi itself, since we already see mass adoption for NFTs.
So it’s about creating a product that’s easy to use and gives value to users.
Q2. What are the advantages of DROPS to other alternatives in the Blockchain field?
Ans — We have a couple competitors, from fractionalisation and loans side. For NFT fractionalisation solutions like NFTX and NFT20 we stand out by having option to fractionalise NFT by keeping the ownership over it.
Also we will have undercollaterilized NFT liquidity, which will make NFTs more liquid. For the loans part, current solutions on the market like NFTfi and Stater are using peer to peer model. It needs a second party to accept the loan.
In our case loans can be obtained in a permissionless manner like in Compound or Aave.
We will have NFT vault solution where users can stake NFT, borrow DAI which gets forwarded to yield farming strategy.
Q3. What are the major milestones DROPS achieved so far & what are in the future pipeline?
Ans — Product wise, we’ve worked tirelessly from early January, so far
we have finished NFT staking, raffles and fractionalisation smart contracts.
We’ve also done around 70% of the work for the Loans.
We also have raised 1m in private round, which will be announced shortly.
Our next milestones are: public sale on launchpads, launch of the NFT staking and fractionalisation protocols in May.
Questions Asked on Twitter For DROPS Team!
Q1. Can you explain and give an example of how the NFT asset value is determined through the associated ERC20 token in the NFT Loan?
Ans — Each NFT contract will have a separate pool fractions.
ERC20 token will have it’s own liquidity at Uniswap, and market forces will decide the value of it 😊
When NFT is locked for the loan, it gets fractionalised and supplied as a collateral.
So it’s the value of ERC20 tokens at the uniswap that will determin the collateral value.
Since we will have undercollaterilized liquidity, there will be a decent liquidity backing NFTs.
Q2. What are the marketing strategies of your project? What will you do so that your project will be visible in crypto field and people come to explore your project?
Ans — For user acquisition we will rely on partnerships and KOLs.
We will have partnerships with NFT projects and NFT games where we will anable staking of NFT assets, which in turn will attract users from partner projects.
Also part of our strategy is having a cross chain solution, we will integrate with Polygon and later on BSC.
Q3. What is the ultimate vision that Your project is trying to achieve within the cryptocurrencies market? Obviously the whole space will experience huge growth in the upcoming years, but what role would you like Your project play in this?
Ans — Our ultimate vision is enable users to earn passive income from their idle NFT assets.
Also become a platform that helps new exciting NFT projects to get exposure.
There is plenty of areas where NFTs will expand, most likely real estate, financials, derivatives.
We will strive to support new markets and bring more value for NFT holders.
Q4. Most of the questions in the AMA section ask the project about its future project goals and intentions and look great at your project as well? So can you share the difficulties that the project has encountered in the past? And how did the project overcome that challenge?
Ans — Team building and development was definitely the most challenging part, some of the written code won’t be ever used, but that’s the part of creating something new.
Adjusting the product, developing and fundraising was definitely the hardest parts. We took a more difficult route for fundraising, instead just giving allocations to a few VCs we onboarded over 130 people.
Q5. This utility to convert NFT to Erc20 caught my attention, when converting NFT into a fungible token, does this Nft not lose its essence by ceasing to be unique? when converting my NFt to Erc20 tokens, will my Nft disappear or can I convert the Erc20 back to NFT?
Conversion works by supplying NFT to the pool and receiving erc20 tokens. We have 2 conversion options.
basic — user converts NFT and loses ownership over it, however if nobody takes it from the pool user still can claim it back.
with lockup — where user locks NFT in the pool, receives erc20 and nobody else can claim the NFT.
there is a collateral ratio to keep this mechanism in tact.
Questions Asked by our BlockTalks Community Members during live Session to DROPS Team!!
Q1. What’s your plan for building an active and global Drops community? How can communities help you at this stage?
Ans — We will make sure stayng in the Drops community will be worthshile, by being able to farm cool NFTs from games, rare NFT drops which have use cases, keeping it engagemed through competitions etc.
Q2. Can you list 1–3 killer features of Your Project that makes it ahead of its competitors? What is the competitive advantage your platform has that you feel most confident about?
Ans — Undercollaterilized NFT liqdudity
Access to liquidity with NFT ownership
Trustless NFT loans.
Q3. I noticed that for every purchase, We can get cashback up to 5% in the form of DROP tokens. So Kindly tell us What are the terms and conditions? and What can the Cashback DROP token be used for?
Ans — Users participating in Drops raffles can get cashback in Drops tokens. Cashback will depend on the amount of LP tokens staked.
Q4. Peer to peer NFT loans option is absent in DROPs. Why?
Ans — Peer to peer is good for legacy NFTs which have a clear market value. However they are difficult to scale, users need to wait for the loan supplier.
Q5. From your website : Drops is able to Bridge NFT assets from other chains, So can you say which chains exactly? How do you avoid the huge transactions fees of Ethereum?
Ans — After the launch on the mainnet, we will launch Drops platform on Polygon and subsidize gas costs.
Q6. I am interested in the concept of NFT and defi by Drops. What does it take to enter the presale? and do you have any special offer for early investors?
Ans — We have closed our private round. Public round of 200k will be done through launchpads.
Q7. Drops is a complex project. Are you going to create educational material so that more people understand your goals and vision?
Ans — Yes, we are in the works to create video tutorials as well as Q&A channel in our discord.
Q8. Are there any benefits to NDR token holder other then the 5% vested to the NDR DAO?How will DROP platform fees be distributed to NDR holders? Will we need to stake NDR?
Ans — NDR with DROPS token will have weight in dVote — non transferrable governance token. Also NDR will be stakable to farm DROPS tokens.
Q9. How your staking model works? And how encourage you user to do staking in Drops?
Ans — We will be creating staking pools for each new NFT project that we partner up with.
As an example — we onboard a new NFT project through our launchpad. We will then create a staking pool for their NFTs, where users will be able to farm dPoints.
Users will be able to use those dPoints to partially cover the cost of new partner project’s NFTs.
Q10. I see your project has several partnerships but who are the main partners? What are the benefits of partnering with the DROPS ecosystem? What is in the future you will reach?
Ans — We have partnerships announcements in the pipeline, most are known NFT projects and games. Our partners benefit of having for utility for their assets, which then increases their long term value.
Q11. I read on your white paper that staking pools will be sorted into three tiers, with different levels of staking yield Tier1, Tier2 and Tier 3, can you tell me more about this? How can I classify in each of the tiers?
Ans — One of our products is NFT Launchpad.
So each of our new partners can sell their exclusive NFTs via our launchpad.Our users can stake NFTs and earn dPoints, which can then be used to get new NFTs.
This way we believe we can encourage our audience to participate in various NFT projects and giving them exposure.