Primer: The NFT space is illiquid. Jae Chung intends to solve it with Unicly, his NFT fractionalization protocol and exchange. JennyDAO is a DAO where NFT collectors come together and pool funds to purchase NFTs to add to their collection. Learn how these two projects synergize with one another in this episode of the Zima Red Podcast.
Background
Has an engineering background
Started crypto in 2017
Found some vulnerabilities in EOS. Received bug bounties for reporting and fixing them
Started running validators on various blockchains, building products, and angel investing
Got into NFTs in Sep 2020. Realized that most NFT projects had very little liquidity. Started to build a solution for this
His Initial Attraction To Crypto
Started working for startups in Hong Kong when he was 14/15 years old
In 2017, his boss assigned him a project to create the infrastructure for EOS
Started doing his research and fell down the crypto rabbit hole
Wanted to put all his time and effort into it for the long haul
"It was really cool how people created [Telegram] groups on their own, and like started building tooling and everything on their own, instead of like the company behind the project building everything out for the community. So it was really interesting to see that going on as a developer, just like, random people all over the world, sort of working towards a similar goal and being hype about the same thing." - Jae Chung
Why Were People From Hong Kong Into EOS Back Then?
EOS was the hot thing at that time
Block.one, the company behind EOS, was based in Hong Kong
EOS was throwing massive events in Hong Kong and it amplified the hype
Finding Vulnerabilities In EOS
Was reading through the source code a lot
Found a part in the code that was not sophisticated
Switched a few components around and the whole network would be rendered useless
Reported it to the Block.one engineering team
Received a 10k USD bug bounty for it
His Journey Into NFTs
A year ago, Ben Rameau, his co-founder of JennyDAO, thought that Punks were going to be massive
Ben wanted to buy Punks up, but his wife vetoed him
Started researching into OG NFTs
"And he [Ben] was saying just go ahead and buy all of them up anyway. But then his wife vetoed him. He ended up not doing it. And then soon enough Punks started going off. And that was very unfortunate." - Jae Chung
Came across Genesis Shards, where fungible tokens can be wrapped up and turned into a NFT
With Genesis Shards, teams do not need to do Simple Agreement for Future Tokens (SAFT) anymore. The NFT will vest the underlying fungible tokens over time
His Thought Process On Making NFTs Better
When he was looking into getting some exposure into NFTs last year, he found it difficult as a beginner:
Unsure about floor prices
NFT valuation
Lack of liquidity
Not enough volume
The existing fractionalization protocols like NIFTEX and NFTX have very high slippage
To get to mass market, there must be a way for people to gain exposure using small sums
Unicly
Unicly is a fractionalization protocol for NFTs as well as an exchange
People can fractionalize a single NFT or a group of NFTs on Unicly into a token that people can buy into
People can now gain exposure to NFTs such as Punks, Beeple, Fewocious without a specific minimum sum at all
There's a ton of liquidity on Unicly as liquidity providers get rewarded for using the protocol
Fractionalizing Your NFT Collection
Go to Unicly, click on new token
User goes through a process of deciding what their new token will be called
User deposits their NFTs, it gets wrapped up into a bundle, and the tokens are then minted
Users can add liquidity and then people can start buying and selling those tokens
Getting Exposure To NFTs Through Unicly
Go to the Swap page and find the collection that you want exposure to
Swap ETH for it to gain exposure to that collection
Buyouts
People can start bidding directly on individual NFTs as soon as a fractionalized collection is created
If the fraction holders feel that the bids are sufficient, they can vote to unlock the collection
When a collection is unlocked, the top bidder on each NFT receives the NFT
Their platform allows people to both bid on individual assets in the collection or the entire collection
Currently working on Unicly V2, which allows collections to sell individual NFTs off to different bidders and share the profits with fraction holders
The UNIC Token
A governance token that allows people to vote
The following are used to exert a buy pressure on UNIC:
0.05% of all trading volume on Unicly
0.5% of every new token minted
For V2, there will be a fee for every sale of a NFT
The fees get distributed to people that staked UNIC. Staked UNIC is called xUNIC to differentiate it from UNIC
JennyDAO
A DAO where people from the NFT community come together and pool their funds to purchase amazing NFTs
The entire JennyDAO collection has been fractionalized on Unicly
NFTs can be added to the fractionalized collection, increasing the value for uJENNY token holders over time
Thought Process Behind Forming JennyDAO
Unicly went through a fully fair launch process. Investors were not allowed to invest directly and there was no presale
The only way to earn UNIC is to liquidity mine the token
JennyDAO was created as a way to mine UNIC token
The uJENNY Token
Used to gain access to the DAO and govern how their vault of funds is used
Anyone with the token can create a proposal to decide what NFT gets purchased next. Their voting power is proportional to how many tokens they have
Proceeds of the sales of any NFTs will be shared with uJENNY token holders
Future Plans Of JennyDAO
Foresees that JennyDAO will be a lot more versatile with Unicly V2
Have a lot of active members in the DAO which share alpha
Thinks that the DAO will be able to outperform if they start trading NFTs and become flexible on what kind of assets they could buy
Could hold exhibits and museums displaying the JennyDAO collection in the metaverse
What Is He Most Excited About In The NFT Space?
Got into Loot last week. Thinks that it has a lot of potential because of its bottom-up approach
Is concerned that not all derivatives of Loot are adding value to the wider ecosystem
"It's [Loot] like a way for people to express their own worlds and metaverses. And like create almost a blueprint of what they believe, can be used by a project in the future." - Jae Chung
People are incentivized to make Loot valuable by giving it utility
The initial hype drew in speculators who wanted to make a quick profit. What makes him confident is that many thought leaders in the space have jumped in to support Loot
Loot is a totally new category of NFTs. People are calling it a bottom-up model for NFTs
Besides Loot, NFT infrastructure is another category he is excited about. Bullish on Unicly and other NFT infrastructure plays
Excited about NFT aggregators like Genie
Thoughts On Larger Brands And Corporations Entering The Space
Saw a tweet from Gmoney saying that money spent on marketing is an expense. However, when Visa announced their purchase of a CryptoPunk, it was a massive marketing stunt that gave them a lot of exposure
The amount Visa paid for the Punk is not a cost. It is an investment for the company
Thinks that when more companies start to purchase punks, it would still have an impact, with diminishing marginal returns for each new company that does so
Thoughts On The Metaverse
Growing up, he played a lot of video games. Has always imagined what a digital world where everything is connected looks like
"I think the Metaverse is really bringing out the dreams that we had as a kid." - Jae Chung
Ready Player One is one of his favourite movies
Thinks that worlds and games like Nifty Island and the Sandbox Game are really cool
NFTs as financial assets are super interesting to him. Thinks that DeFi will start to merge with NFTs and that NFTs will be used in the real world (e.g. concert tickets, real estate)
His Team
Unicly
Recently, they had a project that came in with an ecosystem proposal to contribute to Unicly full-time
The proposal went through and their dev team doubled to 6 devs
Currently have 6 devs, 2 designers, 2 people in operations, and 4 marketers
A lot of recent hires for Unicly
Have marketing agencies that are helping them to make a big push
JennyDAO
Consists of a lot of active members that are contributing and deciding on what to purchase, etc.
His 5-10 Year Vision
Want to be part of a massive movement that he helped build
Want to have enough capital to support any projects that his friends build
"If they want to build something like I'd be able to support them, like even with no strings attached." - Jae Chung
Single Favourite NFT
Have a Genesis CyberKongz
"If I told this to my parents or my girlfriend, they will think I'm so stupid. It sounds stupid, but it's amazing because it's a yield generating NFT, where each day it generates like 10 bananas. And then you can sell it for, like money." - Jae Chung
Most Controversial Thought On NFTs
A lot of NFT projects, especially JPEG projects that are a copy of another project, will either crash or end up having no liquidity and no buyers
Have to be prudent on what kind of places to allocate money to and who the creators of the project are
If You Could Improve One Thing In The Space
Less noise and less pump and dump scams/speculators. This takes away the focus of building value and advancing the space
Who Does He Look Up To And Why?
Santiago Roel Santos: Super active in DeFi and NFTs. Get a lot of great advice from him
The Lau twins: Amount of research and alpha he can get from them
Ben Rameau: His partner on a lot of projects
JennyDAO investors that he is close to
NFT Ecosystem In 3 Years
There will be more NFT infrastructure primitives
This will be used to create the foundational building blocks of the space
All information presented above is for educational purposes only and should not be taken as investment advice. Summaries are prepared by The Reading Ape. While reasonable efforts are made to provide accurate content, any errors in interpreting and summarizing the source material are ours alone. We disclaim any liability associated with the use of our content.