How Pricing Platform PawnHouse Solves NFT Markets' Liquidity Issues

TOKYO, Sept. 9, 2021 /PRNewswire/ -- In recent days, NFT pricing platform PawnHouse has become a highly sought-after project, receiving capital from top investment firms such as Huobi Ventures, A&T Capital, Spark Digital Capital, and CryptoTimes.

NFTs possess enormous market potential and numerous applications. Compared with fungible token assets, NFTs can have personalized, irreplaceable traits, and possess unique value. However, because of the unique nature of each NFT, their circulation has been limited. There are uncertainties as to their value-add and total potential supply, causing hesitation among investors. What the market needs now is a NFT pricing infrastructure that can provide consensus-driven pricing. This can establish broader market confidence in NFTs across the board.

PawnHouse proposes concepts of "Private Value" and "Common Value", which can help investors make sense of how to value NFT assets. Private Value refers to the final deal price at which a buyer is willing to provide at a particular time, independent of other bidders' valuation. However, there are still uncertainties on whether an asset can gain more value and rapid circulation at present valuations.

So, how does PawnHouse price NFT assets and support their liquidity? By utilizing the Nobel Prize winning Simultaneous Multi-Round Auction Format (SMRA), PawnHouse has more data to solidify accurate pricing. Under this model, multiple auction rounds and quotes from rational participants can help generate the highest deal price (the "Private Value"), as well as an effective price range (the most concentrated range of quotes, or "Common Value") at the same time.

This innovative cross-border application applies real-world tested pricing theories to the NFT field. Within this, introduces the 2 concepts of what PawnHouse calls "Consensus Value," and "Price Consensus." Both help solidify a more accurate valuation of a NFT's price by identifying data in the present, and forecasting for the future. For example, the "Price consensus" of NFT assets indicates the consensus range for the asset; where the "highest deal price" shows the highest private value accepted under the current scope, and the "price range" displays the effective quotation information of the market for this type of asset overall.

Because both forces help users grasp a more holistic price perspective, assets priced through PawnHouse can get the highest private quotations on the market. At the same time, the price range data obtained under this mechanism will also help calibrate future prices for this particular asset, and others similar to it. To reiterate, PawnHouse combines the concept of "Consensus value" with NFT asset pricing, and builds a price range for NFT assets by obtaining more effective market quotation information. In addition, through its binding incentive mechanism, the information provider and NFT asset form a mutually beneficial relationship that creates usable value and incentivizes the accuracy of asset pricing.

PawnHouse's V1.0 has already launched, and users can provide price quotations for NFT assets in the form of NFT-collateralized loans. In the future, PawnHouse will look to incorporate multi-dimensional price information to reflect asset values. Effective pricing has become a critical factor to establishing NFT liquidity. Solving this problem will motivate more investors to participate in the NFT market. This will profoundly impact the circulation of NFT assets and will enable the market to determine more complex NFT asset circulation patterns. Because of all this, constructing NFT pricing infrastructure has become a key requirement for capital deployment. Projects that can provide NFT assets with effective quotes set by market consensus will significantly accelerate the evolution of the NFT ecosystem.

SOURCE PawnHouse

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