In a candid and in-depth interview with TheNewsCrypto, NFTFN’s co-founders Vikas Singh and Abhishek Kumar Gupta delve into their entrepreneurial journey, NFTFN’s unique advantages, and their perspectives on the evolving NFT landscape.
With backgrounds in telecommunications, blockchain, and financial technology, these entrepreneurs bring rich experience to their team. Let’s explore their vision, the challenges they face, and the exciting roadmap they’ve charted for NFTFN in the ever-evolving fields of NFTs and decentralized finance.
TheNewsCrypto: Could you briefly introduce yourselves and how your collaboration with NFTFN began?
Vikas Singh (VS): I am Vikas Singh, co-founder and CEO of NFTFN. I graduated from NIT Durgapur, India, in 2012 and started my career in a telecommunications company, progressing from customer support to contributions in the R&D department. My interest in blockchain began in 2016, driven by its potential for decentralization and democratic decision-making. After working with a healthcare startup in Hyderabad, India, exploring blockchain’s benefits, I became a core member of India’s largest blockchain community. In 2018, I founded my own self-sustaining company, later shifting focus to NFTFN, formerly Bliv.Club, where my partner Abhishek and I have been dedicated for the past two years.
Abhishek Kumar Gupta (AKG): I am Abhishek Kumar Gupta, co-founder of NFTFN, with a decade of experience in fintech and tech startups. After obtaining a marketing degree in 2013, I established Startup Delhi, India’s largest startup community with around 60,000 members. Through this community, I connected with Vikas, who guided me in Web3-related matters. Despite challenges like the COVID-19 pandemic affecting my shared office space operations in Delhi NCR, Vikas and I continued exploring creative ideas. Our journey with NFTFN has been focused on opportunities in the NFT space, particularly in blue-chip NFTs, NFT derivatives, and NFT finance.
TheNewsCrypto: NFTFN is particularly relentless in promoting a permanent decentralized exchange for NFTs. Can you explain how a permanent decentralized NFT exchange works?
VS: Our uniqueness lies in the domain we operate. While perpetual contracts are common in trading, applying them to NFTs is unprecedented. Traders are familiar with spot and futures markets where they speculate on price fluctuations. Initially, we aimed to provide this opportunity to existing traders in a new financial asset class—NFTs.
Choosing NFT derivatives was bold, knowing the challenges involved. We recognized the advantage of being industry leaders in the fast-paced crypto world, where innovation that might take five years in other industries can happen in one.
Perpetual contracts, similar to futures but without an expiry date, became our focus. Positions roll over daily, paying premiums to maintain them. Our platform remains neutral, allowing counterparties to join without involving ourselves directly. While this model isn’t common, some competitors have explored NFT perpetual contracts with less efficient price discovery mechanisms. We strategically ensure healthy unit economics, prevent protocol insolvency, and implement robust risk management.
AKG: In 2021, the NFT market faced uncertainty and skepticism. However, competitors made significant strides in educating the market, demonstrating growth potential. As we enter the next bull market, NFTFi is poised to become a significant topic.
TheNewsCrypto: In the cryptocurrency market, how does longing or shorting NFTs differ from similar strategies?
VS: Conceptually, longing or shorting NFTs is akin to what traders do in the cryptocurrency market, but the difference lies in the market itself—the collective volatility of the NFT market.
We chose the most liquid NFT projects, identified their base prices, and computed a geometric mean to create an index representing their base price volatility. This index forms the basis of trading on our platform.
Traders essentially speculate on this composite volatility, deciding to long or short based on market sentiment. Betting against the majority often yields higher returns. On our platform, traders can leverage up to 10x.
Thus, while the product structure resembles other perpetual markets, its uniqueness lies in the market itself. We’re the first to introduce an index and unified order book in the NFT space, aiming to provide a centralized exchange experience for the NFT domain.
AKG: It replicates what’s been done in traditional trading community markets, where you can go long on Apple and short on Microsoft. In NFTFN, the underlying assets differ, but the principles are the same. We applied previously effective methods in markets to NFTs, constructing a platform that offers a familiar experience in different asset categories.
TheNewsCrypto: What is NFT indexation, and how does indexing help track blue-chip NFTs?
VS: When researching our first product for the perpetual domain, we considered two things. Firstly, we explored the idea of offering perpetual markets for individual projects, similar to Bitcoin’s perpetual markets. We chose to create perpetual markets for projects like BAYC (Bored Ape Yacht Club) or MAYC (Mutant Ape Yacht Club), created by Yuga Labs, famous and highly liquid NFT projects. Ownership of these NFTs confers various privileges and exclusive access, demonstrating significant community value.
Effective risk management requires substantial support; otherwise, market maintenance becomes inefficient if prices fluctuate sharply in one direction. To address this, we turned to the indexing approach. Our method selects highly liquid NFTs, simplifying the user’s decision-making process. Standards include significant trading volumes over the past 30 days, a history of over two years, widespread project distribution, and minimal wash trading.
While we acknowledge inherent challenges in unregulated crypto markets, we sought projects with minimal wash trading and widespread distribution. This approach ensures index credibility, reducing external factors’ impact. Our Supernova index comprises cumulative volatility from five of the most liquid NFT projects, creating a reliable and robust investment option. Their inherent liquidity makes them difficult to manipulate, providing traders with a fair and secure environment.
TheNewsCrypto: Besides liquidity issues, what is the most urgent challenge you are currently addressing in the NFT space?
VS: Apart from liquidity challenges, another significant issue is regulation and compliance. Operating a financial product in a market expected to exceed a trillion dollars requires compliance and regulatory approval from global governmental bodies. Currently, we are in discussions with the Abu Dhabi Global Market (ADGM) and exploring compliance requirements in other jurisdictions to ensure our product meets regulatory standards for global user accessibility.
AKG: Another challenge we face is the cognitive issue during the initial NFT bear market. Many viewed the NFT market as contracting, but I hold the opposite view. I see NFTs as a way for users to showcase wealth in the digital world subtly. While people may not explicitly display their crypto holdings, owning significant NFTs becomes a nuanced way to convey financial status.
