SmartArtists will use Stellar and Stellar Turrets to build a decentralized platform that introduces an innovative way to trade NFTs in a way to maximize profits by mixing the standard way of trading NFTs (buy, sell, and profit only one time) with a rewards and pooling system allowing the owners of an asset to continuously earn each time a new user buys.
Before getting too technical, let me show you what the main idea behind all of this is:
Imagine buying a Cryptopunk in the early stages at, let’s say $120. After a while, you are able to sell it for $1000. You are happy with your $880 profit, but it stops right there the exact time you sell the NFT.
Now, let’s say you buy a SmartArtistsPunk(this asset does not exist, but serves as an example) and decide to buy it for $120 (wait, can I decide at what price I can buy the NFT? More on that later in the next paragraphs). Then another person bought it for $700, and, as time goes by, there have been other 23 owners, and the latest owner just spent $15000 on this NFT. Despite you buying the asset for $120 and the next buyer at $700, you have not made an $880 profit, rather a $2000 profit. How is this possible?
Let’s unpack this in the next paragraph.
Besides this paragraph, I encourage readers to listen to this 2 minutes explanation as an integration to the following explanations. Also, I recommend exploring the website and the Litepaper(this one is a quick read that summarizes it all!)
As you may have understood in the introduction paragraph, a SmartArtistNFT owner profits each time there’s a new buyer, and so does this new buyer. In fact, when you buy a SmartArtists NFT, you will not be sending money solely to the previous owner (which would be the user that sold you the NFT if this worked as standard NFT marketplaces work), rather a % of the XLM you used to buy the NFT will go to each previous owner of the asset.
As you might be guessing, this % varies from owner to owner, and it has nothing to do with how early you got in. This % corresponds to how much of the NFT’s network a specific owner represents which, is directly proportional to how much XLM you spent when acquiring the asset. That’s why you can decide the price at which you’ll be buying the asset. If you go for a higher price, you’ll weigh more in the network and receive higher rewards, if you go for a lower price, you’ll weigh less and receive fewer rewards.
Also, when buying, you’ll be directly supporting the artist with a fixed fee that directly goes to their accounts and you will own a Token that can only be acquired through SmartArtists marketplace.
Enough theoretical representations and let’s jump on this image that shows with an example how the basic flow of a SmartArists NFT’s network looks like:
As you can see, an owner earns as long as there is always a new buyer ready to buy. While this is the principle behind trading standard NFTs, I wanted something more for SmartArtists, that's because, as you already know, these are not standard NFTs.
Using the volume/rewards pools functionality, I added a layer of dynamism to the platform, incentivizing users to buy.
When a User buys a saNFT, a percentage of how much the artist earns will be sent to a so-called pool account (a stellar account). The more buyers, the higher will be the value of this pool account.
Each "tot time" (tot stands for the period, can be each day, each week, each month, etc; chosen by the artist) this account will be equally divided between the n owners with the highest owned percentage of the latest k owners. (the artist will set these two parameters).
Who are the k owners? Latest k owners are the ones that have bought in a k period of time before tot time. For example, if k is 3 days and tot time is 1 month, the latest 3 owners will be the ones that have bought in the last 3 days.
This will ensure a high volume for that NFT before the "tot time" is about to end, as there will be users buying to get a part of the pool. But there will also be buyers trying to anticipate the big volume period, as they know there will be a lot of buyers.
100 Operations per transaction
As Stellar supports, 100 operations per transaction, the owners that will receive lumens for each new buyer can be maximum of 93 (I need 7 fixed operations). If the number of owners exceeds 93, only the 93 users with the highest owned percentage will receive XLM.
Buyers will obviously be warned before buying in the marketplace I'm building.
I’ve chosen Stellar as a network to build this project for a simple reason: I needed a performant network allowing me to easily issue assets and a network that supports up to 100 operations per transaction. All backed up by SDK which allows easy data-retrieval and ensures clear communication with HORIZON. Stellar allows me to run things transparently and not have a server take care of managing the owners and their owned network percentage.
Also, having turrets makes the work of decentralization of the contract much easier.
Since I've not already made the code public on Github, it's healthy to share what I'm currently working on and how the code works.
Mainly, there are three sub-projects that together form SmartArtists
The smart contracts for each NFT will be running decentralized on two Stellar Turrets (try out the demo on the testnet). The front-end is being built with react and I'm working on the marketplace, where users will be able to acquire the first SmartArtistsNFTs and earn from them. Right now, I've only worked with integrating Albedo as the wallet, but I'll bring more options such as Xbull market or LOBSTR. Probably, the hardest part will be going production (as I've never gone production with a Stellar project), but Stellar seems to handle that easily with the NETWORKPASSPHRASE. The API will mainly be used for data retrieval for a specific asset and to handle some calls in the upload contract process. Still, nothing concrete will go through the API, everything will run openly on Stellar.
Already built the first Smart Contracts and pool redistribution contract, set up a simple frontend, and got comfortable with working with Albedo. Also started working on the serverless API for the Artists to publish their NFTs.
The development is going pretty smooth even if I'm developing solo, I've currently just finished the front-end and starting to work on the marketplace. The project has not yet been announced thus has no users, the network would be accessible to all the globe and I have not yet raised any funds.
I’d like to see SmartArtists get a solid base of users in the production environment. I'll start by getting the first production deployment up, with only a few assets.
After that I see this project becoming a platform where verified artists are able to deploy these SmartContractNFTs easily within a few clicks and by being able to set their own fees (without any fees taken by the platform).
Obviously, I’d also need to get some artists on the platform and sort out how the verification process of the artist would work (also from a legal point of view probably), still, I’d initially bring only a set of assets I’ve (or other people I’ve eventually already talked with) built. I’d say in 6 months I will have already sorted out this thing about verification (which is not in my competence) and brought a couple of artists on the platform.
As better described in the project body, once deploying the marketplace (will not be long from now), I will leverage my online audience on Medium (1K followers, ~20-30K monthly views) and start interacting on Twitter with other Stellar Enthusiast to get eyes and users on SmartArtists. But I don't believe that good marketing can make a great project, so, what I'm really looking for is a sincere opinion on this project.
That's why what I believe I need the most to get the project to the next level is a supporting and interested online community, and passing the panel selection along with Medium articles and Twitter interaction would set steady foundations to build such a community. I'm also planning to launch a discord server for those who have questions or want to get constant updates on the development.
I have not yet seen a crypto-based and decentralized platform to directly earn supporting the artists you think deserve more, sure there's bitclout (which is a great project) but the artists don't get to choose their fee, and from the point of view of the users, the profits are much higher with SmartArtists (also, the two are very different technologies and I wouldn't call it a competitor).
Smart-artists will be using Stellar Turrets for the smart contracts, the SDK in the front-end, and the serverless API I'm building for managing the marketplace (only for data retrieval, everything concrete will still run decentralized on Stellar)
I've decided to get no revenue from the project directly (probably only the 1 Lumen the artist would pay to get the asset issued). I plan on making revenue by using the platform myself. Firstly by being the "artist" behind the first tokens that will be on the marketplace, but then also investing personally on other tokens (this will be possible only when I'm able to get users and artists in).
Decentralization is the future, and so are all platforms that leverage it, but I realize not every app can be noticed by the internet, and that's why I've set up a simple strategy to drive users into the project.
Being able even to only pass the panel selection stage would allow me to have enough credentials and visibility to start doing the marketing: being able to be seen and voted by many Stellar lovers looking for a good project is something I would really count on if smart artists passed the Panel Selection. Secondly, I've thought about interacting on Twitter (obviously no spam or solely product promoting) with other developers, artists, and Stellar community members (I've also thought about promoting some tweets).
Next, I would leverage my audience on Medium, in which I have about 1K+ followers and ~15K to ~30K views per month (depending on each month). I'll make a piece on Yard Couch (where I'm editor, with ~5K followers) with an overview on the network and how to earn from it, and one in better programming (~200K followers, I'm not an editor there but if the article is well-written it will get accepted) where I'll talk about the development stages of the project, management, and so on. This will get some eyes on the project.
The key to all this "advertising" though is making it through the panel selection which would convince my audience this project is worth looking into. That's what I'm mostly looking for. In fact, you'll notice the requested budget is relatively low as I think that once the project gets enough users, the budget to continue promoting and developing will create itself according to my revenue plan.
The requested $1500 will mainly go for ads, and paying freelancers to make some SVG art for the front-end as a good landing page keeps the customers intrigued (I'd like the frontend to become stellar.org-like with the awesome SVG graphics)
* The amounts shown are budget requests and not (yet) granted to the projects. During the Community Vote phase, voters can indicate whether the project deserves the amount it's asking for (budget request). The total pool of XLM available for SCF#11 is 8M XLM. SDF will allocate the XLM equivalent of the specified USD budget of the submissions with the most votes in descending order of rank until the earlier of (i) the XLM Pool is fully distributed (ii) there is not sufficient XLM remaining in the XLM pool to fully fund the next ranked submission or (iii) there are no remaining eligible submissions. The USD valuation of the budget request in XLM will be calculated using the CF Stellar Lumens-Dollar Settlement Price on December 5, 2022 as administered, maintained, and reported by the cryptocurrency index provider CF Benchmarks Ltd. (using the ticker “XLMUSD_RR”) (available at https://www.cfbenchmarks.com/indices/XLMUSD_RR). Learn more in the SCF Handbook.
*The USD valuation of the award in XLM is calculated using the CF Stellar Lumens-Dollar Settlement Price on July 5th as administered, maintained, and reported by the cryptocurrency index provider CF Benchmarks Ltd. (using the ticker “XLMUSD_RR”) (available at https://www.cfbenchmarks.com/indices/XLMUSD_RR)
**The USD valuation of the award in XLM is calculated using the CF Stellar Lumens-Dollar Settlement Price on December 16, 2021 as administered, maintained, and reported by the cryptocurrency index provider CF Benchmarks Ltd. (using the ticker “XLMUSD_RR”) (available at https://www.cfbenchmarks.com/indices/XLMUSD_RR)
*The USD valuation of the award in XLM is calculated using the CF Stellar Lumens-Dollar Settlement Price on September 27, 2021 as administered, maintained, and reported by the cryptocurrency index provider CF Benchmarks Ltd. (using the ticker “XLMUSD_RR”) (available at https://www.cfbenchmarks.com/indices/XLMUSD_RR)
* The USD valuation of the award in XLM is calculated using the CF Stellar Lumens-Dollar Settlement Price on the date of transfer as administered, maintained, and reported by the cryptocurrency index provider CF Benchmarks Ltd. (using the ticker “XLMUSD_RR”) (available at https://www.cfbenchmarks.com/indices/XLMUSD_RR)