Draft Proposal: XIP#10: Sell off non-floor NFTs from NFTX v1 Vaults




Floor priced




This draft proposal is intended to discuss selling/auctioning off all non-floor NFT assets held by NFTX v1 vaults for ETH and/or stablecoins. This will act as a buyout mechanism for v1 vault token holders. As a secondary effect, this helps rebalance the DAO treasury to be (a bit) less exposed to the NFT markets, as the NFTX DAO holds a majority of these v1 vault tokens on its balance sheet.


With NFTX v2 being introduced in June, the DAO is currently migrating DAO-owned liquidity from v1 vaults towards v2 vaults, while collapsing some close-to-equal v1 vaults such as PUNK-BASIC, PUNK-FEMALE and PUNK-ATTR-4 into one v2 vault, namely $PUNK. This is done to further optimize the usefulness of v2 vaults, both bringing deeper liquidity to AMM pools causing less slippage, as well as offering a broader inventory for retail users that want to buy a specific NFT from a vault.

With this said, there are a couple v1 genesis vaults that hold non-floor priced NFT assets as collateral (NFTs which are considered of higher value and/or rarity). As NFTX isn’t optimized for fractionalizing higher-value assets due to not having a protocol vault buyout mechanism, selling off collateral and distributing rewards to token holders looks like a valid alternative to unwind these vaults.

Many of the vault tokens are still 100% owned by the DAO (i.e. Axie Mystics) due to never being listed on an AMM, while some have been distributed more widely (i.e. PUNK-ZOMBIE). Thus in many of the proposed selling/auctioning of NFTs, this means that the DAO would be liquidating non-floor assets on its’ balance sheet in return for either ETH or DAI/USDC. In other scenarios, such as the PUNK-ZOMBIE vault, it’d act as both a buyout mechanism for retail token holders, as well as diversification for DAO treasury.

The full list of vaults applying to this draft proposal are:

  • JOY

If this were to pass, we would redeem collateral from the above listed v1 genesis vaults through an Aragon NFTX DAO vote, and offer them on their respective marketplaces at predefined rates (to be discussed on forums - my current thoughts are “Average going rate of rarity, reweight & drop by 5% if not sold in a month).

Example 1 (Tokens distributed over multiple holders): A vault that holds 2 high value NFTs has it’s tokens distributed to 20 owners, all owning 5% of the supply. The 2 NFTs collectively generate 400 ETH worth of sales. After both NFTs are sold, the 400 ETH gets deposited in a claim contract. Owning 5% of the vault tokens allows you to claim 20 ETH from the contract (5% of 400 ETH), burning your vault tokens in the process. This contract remains in claim mode forever, causing the vault tokens to never be unbacked by sales generated.

Example 2 (Tokens held by one owner, i.e. the DAO): A vault that holds 2 high value NFTs has it’s tokens distributed to 1 owner. The owner redeems all NFTs from the vault and lists them for sale. Generated sales are collected by the owner, and potentially diversified into other currencies (i.e. USDC or DAI) after.



  • Offers the most true-to-value buyout mechanism for current affected v1 vault token holders.
  • Offers a way to diversify the NFTX DAO balance sheet to be a bit less NFT heavy, while bringing other currencies such as ETH and/or stablecoins for extending DAO runway (Note: we would still hold a sizeable position due to floor v2 vaults as suggested here)
  • May strengthen our positioning as the primary liquidity hub for floor priced NFT assets by not holding higher valued NFTs captive in (deprecated) v1 vaults.


  • Listing of assets must be spread out according to activity of the asset listed. I.e. we cannot simultaneously list 15 Joyworld JOYS, as it will temporarily kill their market.
  • In addition to the point above and suggested rates (avg going rate) may cause potential for floor undercutting, causing the asset to not sell in a reasonable time frame.


If this proposal would pass in its’ current form, this would mean that:

  • PUNK-ATTR-5, PUNK-ZOMBIE, AXIE-ORIGIN, AXIE-MYSTIC-1, AXIE-MYSTIC-2, AVASTR-RANK-60, KITTY-FOUNDER and JOY vault contracts would be overridden through an Aragon vote, unlocking collateral to be listed at average going rate, on secondary markets (such as OpenSea or LarvaLabs Marketplace).
  • ETH collected in buyout sales would be distributed to associated v1 vault token holders through a migration contract that burns v1 vault tokens upon redemption of collateral, after all assets are sold successfully.
  • ETH claimed by DAO-owned v1 vault tokens would be exchanged for stablecoins at a 50/50% rate (rates to be discussed in comments).

Funding request - Yes - Implementation Requires Funding

In order to execute this proposal, all NFT collateral in the vaults listed under specifications would be required to be withdrawn through an onchain governance vote (Aragon), with the purpose of listing on secondary markets.


Proposed points of discussion.

  • Is this in the best interest of v1 vault token holders?
  • If in favor, is current average floor the best listing rate?
  • Exchange rates for DAO-collected ETH to stablecoins (from 0 to 100%, and to which stablecoin?)

Quorum (For forum)

  • Minimum Quorum: At least 5 votes
  • Passing Threshold: More than 50% must vote in agreement for the XIP to Pass. For changes to the NFTX contract, more than 70% must vote in agreement for the XIP to pass.
Proceed with proposal
  • Yes
  • No

0 voters


Thanks again Chop! Great proposal :rocket:


Seems like the most logical approach to get V1 fractional token holders sorted plus improve liquidity on for DAO and DAO vaults.