Not all non-fungible tokens (NFTs) are the same. There are some unique features that are not commonly shared. Sometimes collectors stumble upon these nuggets and want to reflect their value. However, it can be difficult to distinguish rare tokens from regular tokens.
Now, it said, ranking non-fungible tokens on OpenC has become easier with the introduction of a new tool called “Open Rarity.” American Marketplace thus describes its new factor as “rarity,” a method that standardizes unique digital images.
NFTs for the private collector
In a post, OpenSea explained: “The ‘scarcity’ ranking allows us to describe the relative lack of features of another non-fungible token in the same collection”.
“An NFT with rare characteristics will have a lower rarity ranking (eg 1 or 2) than an NFT that shares characteristics with thousands of others in the collection,” it added.
Value has a strong correlation with scarcity. This is why exclusivity is an important factor for NFT collectors. In the absence of a standardized ranking process, however, it is difficult to determine the exclusivity of a non-fungible token’s attributes.
According to OpenSea, this has created a chaotic situation. “When rarity rankings vary from platform to platform and use different methods, it can confuse buyers and sellers and complicate the use of the rarity factor for buying and selling decisions”.
The goal then would be to create “a unified, open, transparent and repeatable standard for rarity rankings across the NFT industry”.
Why classify your NFT?
OpenRarity is a joint venture between OpenSea, icy.tools, Curio and PROOF. Its users have the option to indicate whether their collections are rare or not. A collection that chooses this option must display a number identifying the rarity rating on the item page as well as on its collection page.
According to OpenSea, this classification is crucial in interoperable markets, where different NFTs can be traded.
The platform explained: “If you hover over the numbers, you’ll see the percentage ranking. OpenRarity rarity ratings reflect attribute data directly published by the creator and may change over time if the creator makes changes to the item’s metadata.”
Pudgy Penguins, one of the first NFT collections available on OpenRarity, lists 8,888 non-fungible tokens of various properties. According to a description of the collection of rare tools, Pudgis “embodies love, compassion and compassion.”
It is described as a “source of good vibes and positivity for all”. Each holder gets exclusive access to experiences, events, IP licensing opportunities and more.”
As of Friday, September 27, Pudgy Penguin’s floor price averaged 3.8 ETH or about $4,900, down 2.7% on the day. According to NFT floor price data, the collection sold 66 ETH (about $86,000) in the last 24 hours, down 30% from the previous day.
Cool Cats, another collection, has 9,999 randomly generated non-fungible tokens on OpenRarity. According to its concept, its holders can participate in exclusive events such as free NFT requests, raffles or even community giveaways, among others.
At the time of writing, Cool Cats are selling at an average price of 2.95 ETH (~$3,800) each, up 7.2% over the previous 24 hours, with volume at 96.89 ETH (around $126,000).
Lack, a magic formula?
However, a recent study by the Stevens Institute of Technology suggests that scarcity may not be the magic bullet for NFTs. In fact, according to this study, there are several potential pitfalls.
Jordan Sucho, a cognitive scientist who led the study, cautioned that the hype around rare non-fungible tokens needs to be managed, as collectors may become bored.
“Knowing that NFT trading data is public, it gives us a great opportunity to examine why people perceive the value of certain things and how that changes over time,” Sucho said.
Mr. Sucho studied Bored Ape Yacht Club collectors and noticed a decline in interest in these NFTs over time.
A monkey token wearing an accessory is considered rarer, compared to a more modestly dressed monkey NFT. It can be interesting at first, Sucho says, but as the collection grows, the monkeys can all look the same.
“It’s a bit like a stamp collection: the stamps all look the same. So if there’s a misprint or some other rare feature that sets one stamp apart from the others, people will pay a lot more to acquire it,” he explains.
“Today, a newcomer to the bored apes trade sees these rare apes everywhere and thinks they are much more common than they really are.”
Jordan Sucho added:
“If someone wants to know what a dog is, they can go to a dog park and see several common animals. On the other hand, going to an experimental breeder and looking only at rare breeds will skew his perception of a given dog’s type and value.”
The scientist thus concluded that the cause of scarcity could be self-defeating, as it would prevent trading in the more common currencies that make up the bulk of the market.
The concept is not new
Scarcity is not a new concept. In traditional art and music, for example, there are so-called ‘collectibles’, which are not designed for the mainstream market.
Hip-hop group Wu-Tang Clan, for example, sold a single copy of its album “Once Upon a Time in Shaolin” to a crypto group as an NFT, worth about $4 million. The album content is not yet available to the general public.
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