Adding a 0xuniverse index

I would like to create a couple of indexes related to 0xuniverse. Pre requisite is having a feedback here if the all operation makes sense.
The game has a big audience but went through financial troubles because of high gas costs and stall in trading.
I can imagine that investors have also assessed a better capital allocation in the booming defi.
In my opinion there are two dimensions:

  • one centralized which is the gaming dimension which I would not underestimate for the potential audience. The L2 ‘galaxie(s)’ are active and bring people in the game
    but imho assets there have not a value comparable with native ethereum ones.
  • one is decentralized and is the NFT one in the original ethereum galaxy.
    There, the assets (planets) have a max fix supply 500k commons, 400k rares both not relevant for funds as too cheap and 100k epics and less than 120 legendary…
    The epics are classified by resource and approx 20k of them can be classified as Lepic (they have legendary resource). Note that the planets discovered till now are less than 50% and
    the cost of discovery plus increasing difficulty will make very hard to go over 60% of existing planets in ethereum.
    In my opinion lepics could be a good asset to back up an index. The reason is that they were trading between 0.025 and 0.055 before the gas cost explosion and in average at 0.035

1k lepic planets could back a 35 ether index. In order to have a meaningful index we should have trades and not only players dumping assets at low gas price. I believe that there is a best case scenario which can happen based on the following use cases:

  1. the arbitraging between assets in game and assets in the index that are described in the lightpaper.
  2. an additional pseudo arbitrage. the game include an asset, partially centralized but handled properly (simply requires trust in the game owners servers), energy. This can be transformed in an erc-20 token and traded. Planets include limited amount of energy. Players can mint from the index adding exahusted lepics and redeem hoping to get randomly planets which still have energy.
  3. another operation mint-redeem could be made by exchanging lower grade lepics compared with the average included in the index.
  4. A renewed activity in game can bring income to game owners and make them more active (they are in passive mode currently). I believe that the game-dimension on top of collectible one could add long term value to the assets.
    Index backed by legendaries.
    Legendaries are imho a fantastic asset if, for the less valuable, owners are interested to created 1-1 indexes at 10-15 ether evaluation, or we can identify the 10 less valuable and create an index out of it (obviously the first couple of legendaries must be added and the owners found: i don’t own any legendary planet)

we have to consider the eventual capability of the 0xuniverse contract owners to mint planets at will: it would be suicidal but it has to be excluded. Therefore this should be clarified with them and excluded in the smart contracts.

the list of the allowed asset backing the lepic index can be actualized each 2-3 months. They are still discovered and the index should consider it.

Do you think that an index like the lepics one could make sense? Could it be possible to incentivize the first minters in case? (it would be me at first …).

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Hey @thp, appreciate you looking to create funds on NFTX. I am hoping to have more documentation available by the end of this month (and also a slightly improved front-end process).

The main problem I see with what you’ve outlined is that some planets have quite a low price. Due to high gas prices, the cost of redeeming an NFT from a fund can be 0.02 ETH or more. Therefor it is impractical for funds to exist for items less than about 0.1 ETH in price, since minting and redeeming can end up costing almost as much as the item itself.

I’m browsing 0xUniverse planets right now on OpenSea. From the looks of it, a Legendary planet fund would be feasible if you could get your hands on one or more of the legendary planets. And Epic planet fund would probably be better since there is only one legendary planet for sale, however epic planets start at like 0.01 ETH, so they would need to have their floor appreciate a fair amount in order to get to that 0.1 ETH happy place. Could definitely happen though.

In the future we will likely offer grants and gas reimbursements to creators who want to make funds which end up being popular, but I can’t promise anything like that yet.

Let me know if you have any other questions @thp — I do think an epics planet fund would be really cool if the price floor increases — legendary planet fund could be solid too.

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epics can be divided in two groups: normal epics and lepics. This depends on the resources of the planet. The lepics (currently I think there are about 6k) price is in the 0.035 range but the market is illiquid. Actually i see asset backed funds as a way to make the assets liquid again (at least a chance).
The main question for me now is: legendaries are really limited in quantity. Could make sense to make a fund which allows hypotetically all of them to be added? Obviously the owner has to be careful as some legendaries have properties like more unlikely to be minted relatively to all the others, older which makes them more valuable. Or perhaps it could be possible to identify 10 in the same range and allow them and only them.
Another question: can be the adding of planets subsidized by nftx?
I clicked around in the interface and it looked like the creation of an index itself requires half ether or more. Is it correct?

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hey @thp, (apologies for the delayed response).

Yes this is definitely the way to go in my opinion. People will just have to be careful and not put very high-end legendaries in (sort of like how people don’t put very high-end JOYs into the JOY fund)

We haven’t decided anything formally yet but I strongly expect the community will support us reimbursing users for the gas costs when creating funds. $500 sounds more expensive than what I would have expected… there may be something going on there, but could maybe be accurate given high gas these days. Either way, we can very likely reimburse the expense and will know more about this soon.

Also, I think the idea of splitty epics into two groups could work well

I think this is a great idea.
From what I am reading, it looks like we could create a balancer fund incorporating different planet types. If this is the case and it would not be too gas prohibitive, I would suggest

  • Common
  • Rare
  • Epic
  • Epic with Legendary resource
  • Legendary

I have been tracking and charting 0xUniverse planet prices for a couple of years now. Here are links to the last two price charts which are also posted in the # com-writeups on the Discord.
ETH Price Chart:
Matic Price Chart:

I only have one Legendary, but would be willing to contribute it to the fund.

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its even possible to make more differences in planets like

  • commmon
  • common with rare resources
  • rare with common resources
  • rare with rare resources
  • rare with epic resources
  • epic with rare resources
  • epic with epic resources
  • epic with legendary resources
  • legendary with epic resources
  • legendary with legendary resources

and there is also virgin planets ( aka without energy minted planets) and with energy minted planets…

i dont know if this a plus thing i mentioned to your post ? just saying something

you need to assess the real value of the legendary of course. If it can have a very high collectible value (for example very old one and so on) you can wait and sell it in a growing market

energy is not a decentralized feature: it cannot be used as a criterion, All the rest is feasible but gas is too high: therefore the meaningful indexes are two.
Legendary now.
in a second time lepics. the gas has to decrease in value and the floor price for lepics has to reach .08
Obviously adding a lepic you loose the direct ownership (there could be lepics without and with energy in the index) up to the user to add the ‘worst’ ones or redeem planets hoping in getting a value higher than the one priced in the index.

alex: some interest is popping up. please keep an eye on the thread so that, if the conditions come to create a legendary index you can clarify some of my and other people questions: example, if possible, compensate index creator of gas cost with nftx and perhaps the first couple of planets added to the index. @Yostari says that he would add his only one: I believe a player with one legendary acting in a so trusty way could be compensated (i am convinced he will gain at the end). There are some whales also in 0Xuniverse: I expect their interest as a legendary index could be a vehicle of interest for the extremely rare asset which are legendary planets (one of the rarest in the crypto community)