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Nftperp Review: Long & Short NFTs With Any Budget

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Last Updated Jan 17, 2023  |  Affiliate Disclosure

  • Review

Key Takeaways

  • Nftperp, built on Arbitrum, is a new DEX that lets you long and short blue chip NFT projects with wrapped Ethereum (WETH). This enables traders to hedge their positions and profit from the price movements without having to own the actual NFTs.
  • It has 5 NFT collections so far: BAYC, MAYC, Azuki, Crypto Punks, and Milady. You can trade all the way up to 10x leverage.
  • The project is currently in Private Beta and you need to apply for the whitelist. The public mainnet launch is expected at some point in 2023. There is a confirmed airdrop for Private Beta traders.

What Is Nftperp?

Nftperp is a decentralized exchange (DEX) for perpetual futures on NFTs. It lets you go long or short on the floor prices of popular NFT collections with up to 10x leverage. The platform claims to be a "fast, low fee, secure, and fully decentralized exchange protocol.”

At the time of this writing, it's in Private Beta and supports Bored Apes, Crypto Punks, Azuki, Mutant Apes, and more. It’s a new solution for investors who want to hedge their NFT positions, get exposure to blue chip NFTs on a low budget, or try to predict the prices of NFTs.

Why Does It Exist?

According to their documentation, Nftperp was created to address three issues faced by NFT investors:

  • To Make Blue Chip NFTs Accessible: Blue chip NFTs such as BAYC and Crypto Punks cost 50-100 ETH and are out of reach for 99% of retail investors. This leads to the NFT market becoming a "whale only" type of asset, leaving retail investors without the opportunity to invest.
  • To Go Long or Short on NFTs: Previously, there was no way to short NFTs for those that are bearish or those that just want to hedge their positions.
  • To Reduce Fees: High fees on OpenSea make it harder for traders to profit. OpenSea has a 2.5% service fee and 2.5% royalty for creators so traders need to be up at least 5% just to break even.
Nftperp

Core Features

1. Long & Short NFTs

Nftperp Collections

Go long or short on BAYC, MAYC, Azuki, Punks, and Milady with up to 10x leverage. At the time of this writing, there are only 5 NFT collections but more are on the way. With perpetual futures, you don't need real NFTs as collateral. Nftperp lets you make trades and post collateral with WETH.

2. Trading Dashboard

Nftperp Pro Trade

This is the Pro trading dashboard but you can also toggle the Lite version for a simpler interface. Your wallet address needs to be whitelisted in order to make trades in the private beta.

3. Decentralized

Nftperp is a DEX built on Arbitrum, making it accessible to a global audience. To make trades, all you need is a Web3 wallet like Metamask and some ETH. Some of the cheapest places to buy ETH are on Binance and KuCoin (referral links).

4. Analytics

Nftperp Analytics

Users can track their performance and improve their trading strategies using leaderboards, analytics, and paper trading on the platform. Statistics like total volume, open interest, and top ROI by wallet address can be viewed at https://beta.nftperp.xyz/stats and https://beta.nftperp.xyz/leaderboard. You can use this to spy on active wallets, find strategies, and see what active traders are up to.

5. Fractional Ownership

Nftperp provides fractional exposure to blue chip NFTs, making them accessible to a wider range of investors who may not have the funds to purchase the whole NFT. KuCoin is another platform that has launched fractional NFTs, helping make expensive collections more accessible.

6. Paper Trading

Nftperp Paper Trading

Hedging Your NFT Positions

To further explain how Nftperp can be useful, lets look at an example. By opening a short position, traders can potentially profit from a decrease in the value of the NFTs they hold, offsetting any potential losses they may incur. This feature of Nftperp provides traders with an additional tool to manage the risks associated with investing in NFTs.

For example, Sarah owns a Crypto Punk with a floor price of 50 ETH. She is worried about the market downturn and wants to protect her investment without selling her Crypto Punk.

She discovers Nftperp and opens a 50 ETH short position on the exchange. If the floor price of CryptoPunk drops to 45 ETH, her CryptoPunk is now worth 45 ETH, but she can close her short position with a 5 ETH profit.

Instead of losing 5 ETH with the floor price drop, Sarah can now hedge her position with no value lost. And if the floor price of CryptoPunk increases to 55 ETH, Sarah would have a loss of 5 ETH on her short position but her CryptoPunk is now worth 5 ETH more.

How To Get The $PERP Airdrop

Nftperp has a confirmed airdrop campaign called "nftperp Odeshi" which is a retroactive airdrop for private beta traders. Their website homepage allows you to apply for the whitelist.

Users who participate in the private beta by trading on the platform will be eligible for the airdrop, based on their total trading volume and activity. Private beta traders will earn $vNFTP, a voucher token that can be converted into $NFTP in the future. 

How To Set Up Arbitrum

Before you can use Nftperp, you will need to do the following things:

  • Get a crypto wallet like Metamask that is connected to the Arbitrum network
  • Transfer Ethereum onto the Arbitrum network, which can be done through the Arbitrum Bridge or by transferring from a centralized exchange.
  • Have some ETH for gas fees. Transactions on Arbitrum are very cheap so a couple of USD worth of ETH should last you a while.
  • Once you have ETH on the Arbitrum network, you will need to wrap it to WETH in order to use it for trading on Nftperp. You can swap ETH for WETH on Uniswap.

How To Use Nftperp

Keep in mind, this only works if you get accepted into their Private Beta which you can apply for on the website homepage. If you're not accepted yet, you can try Paper Trading in the meantime. Here is what to do once you're whitelisted:

Connect Your Wallet

Visit Nftperp and connect your wallet in the top right corner.

Select The NFT You Want To Trade

Pick the NFT you want to trade and decide if you want to go long or short. Choose how much you want to trade and the leverage you’d like to take (between 1x and 10x). 

Long or Short

Then, "Approve" your trade, confirm it on your wallet, and wait for it to execute. You will have to pay a small gas fee.

Monitor Your Trade

Open Positions

You will then be able to view details of your trade as you can see in these images.

Summary

In conclusion, Nftperp is a decentralized exchange protocol that allows traders to open long or short positions on NFTs with up to 10x leverage. This provides a way to hedge positions and profit from price movements of NFTs without owning the actual NFTs.

The platform offers a variety of features such as leaderboards, analytics, and paper trading to help users improve their trading strategies and track their performance. Transactions on the Arbitrum network are very cheap, and the platform is accessible to a global audience as long as you have a Web3 wallet.

However, it is important to note that the platform is still in its beta phase, and it only supports a limited number of NFTs at the moment. Additionally, liquidity is important for Nftperp to work effectively and as it is a new platform, liquidity may not be sufficient yet. 

The Bottom Line

Overall, Nftperp is an innovative platform that provides a new way to trade NFTs and offers a variety of features to help users improve their trading strategies. However, it is important to understand the risks involved and to keep in mind that it's still in Private Beta.

Pros & Cons

  • Long or short popular NFTs with 1x-10x leverage
  • Get exposure blue chip NFTs without spending 100 ETH
  • Hedge your NFT positions
  • Transactions on Arbitrum are cheap. Only a few dollars worth of ETH should last a while
  • Potential airdrop for early users
  • Still in its beta phase and not available for the public (roadmap says 2023)
  • Only supports about 5 NFT collections currently
  • Since it's relatively new, liquidity may not be sufficient yet which is important for its success

Official Links


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