Goat Swap Overview
The NFT market is currently hindered by low liquidity as well as the price volatility of NFTs, but the AMM model applied to the NFT market has made it easier than ever to provide liquidity and pricing for NFTs. GOAT Swap is an NFT trading platform built on the AMM model for NFT liquidity providers that helps to create automatic liquidity for NFTs like Sudoswap.
Along with the more established Sudoswap, which was just just launched to facilitate NFT collections on the Ethereum network. On September 3, Goat Swap received its formal debut. It is the first NFT AMM platform created on the Solana ecosystem to serve the network's NFT marketplace.
How Goat Swap operates
Goat Swap may operate similarly to Sudoswap when employing a link mechanism with a bonding curve. However albeit the exact mechanism is still unknown. There are two popular curve models at the moment: Linear and Exponential. Specific links aid in establishing the relationship between supply and price, allowing asset pricing.
Additionally, the Goat Swap operating mechanism is by default a Linear model in the near future. This means that the price of the subsequent NFT will reduce by delta if the pool purchases one NFT. The selling price of the subsequent NFT will drop in delta if the pool sells one NFT. Liquidity providers can set up two-sides buy-sell pools to create spreads and earn fees, much like Sudoswap does.
Goat Swap fees
According to information on the Goat Swap website, this project currently only charges 1% of the transaction fee, which is quite competitive for a platform that has just been launched and supports the Solana network, where gas costs are reasonably low. However, Goat Swap still charges more than its predecessor Sudoswap, which had a 0.5% fee. Users can hope that transaction costs will be equal to or cheaper than Sudoswap once Goat Swap has a steady user base.
On the other hand, pool owners are free to decide on their own prices. The price is what the user sees when the transaction charge is added to the list on Goat Swap.
Whether Goat Swap will give NFT issuers a royalty on each NFT transaction made and occurring in the secondary market is presently unknown. Goat Swap will struggle to draw blue-chip collections or the collections of other well-known artists if it follows Sudoswap's step and not paying royalty fees to NFT authors.
Goat Swap Team
Research indicates that Raccoons Dev is Goat Swap's team. This group is responsible for various initiatives on Solana, including:
- Jupiter: The leading swap aggregator on Solana with over 20 billion USD in traded volume
- Mercurial: An AMM-based DeFi infrastructure platform on Solana that maximizes utility and output of stable assets
- Pawnhub: NFT Lending site on Solana
The team had excellent products and a sizable user base; Goat Swap is anticipated to be the system's next possible NFT AMM project after Sudoswap. ecology of solanum Several common and well-known people can be identified based on the information we can gather about specific members that create Goat Swap on Discord, including:
- Siong Ong (Twitter): Engineer at projects such as GraffitiGeo, Prefer, Expa, Envoy (project invested by a16z).
- Ben Chow (Twitter): Co-founder, Growth Lead at Jupiter Aggregator, and developer of Mercurial Finance.
The whitepaper is currently being created while the project is still being finished. The platform's token issuance as well as a user airdrop strategy were also alluded to by the project. The project's Twitter account will be used to make specific announcements about the token release and airdrop plan.
The project has also stated that it will make a collection of its own NFT available once a specific amount of users and transactions have been recorded on the platform.
We can infer from the aforementioned news that the project will have its own token, just as Sudoswap did when it announced the platform's native token $SUDO and airdropped $SUDO to eligible users. airdrop occasion.
To participate in the game, current users must generate liquidity for the Goat Swap platform in order to be eligible for an airdrop if the project eventually announces tokenomics and the release of native tokens. Let's construct a pool on the platform in the manner shown below to aid Holdstation in the game and aid in the creation of liquidity for Goat Swap.
How to create pool on Goat Swap
Step 1: Users need Solana wallets to be able to connect to Goat Swap (eg Sollet, Solflare, Glow, Slope,...) but the most popular is still Phantom wallet and a $SOL amount from 0.5 -1 SOL to be able to buy NFT and as a transaction fee on the platform.
Step 2: Users go to Goat Swap website and click Connect Wallet located in the right corner of the screen. Click on Phantom wallet and successfully connect to the platform.
Step 3: After successfully connecting the wallet, the user's Phantom wallet address will appear on the right corner of the platform as shown below.
Step 4: Goat Swap currently only accepts authenticated NFT collections to protect new users from mistakenly purchasing fake collections. If the user is an NFT creator, you can apply for collection validation using the Metaplex tool.
Users can click on 'Your NFTs' to see which NFTs they own that they can create a pool with. If the user does not have an NFT, the user needs to proceed with the purchase of an NFT. Click on 'Collections' to find your favorite NFT to buy.
Step 5: Proceed to buy NFT. Buying NFT on Goat Swap is quite simple, for example, the author wants to buy NFT from the Dippies collection. The author proceeds to buy Dippies #2014 for 0.55 SOL and clicks the 'Buy now'. Phantom will pop up a notification window asking the user for approval. When the author presses 'Approve' the transaction will proceed, then the user will find his or her NFT by clicking on the 'Your NFTs'.
Step 6: Users proceed to create a pool when they have a suitable NFT by clicking on the 'Your Pools' section and clicking on the 'Create a pool'.
Step 7: Goat Swap will pop up a window as shown below with 3 options: Buy NFTs, Sell NFTs, Do both and earn trading fees.
- The author chooses the 'Do both and earn trading fees' item because he wants to benefit from the fee difference.
- The 'Amount of NFTs to Buy' section entry is 1, because the author currently only has 1 NFT. If the user wants to add more NFTs to the pool, they can select multiple NFTs.
- The 'Start price (SOL)' section entry is 0.02 SOL because the author thinks 0.02 SOL is a fair price to buy/sell this NFT.
- The item ‘Change price by (SOL)’ is the delta variable price (as mentioned in the mechanism of action) per NFT bought/sold in the portfolio.
- The 'Fee (%)' section is the profit the pool owner wants, set the percentage to meet your risk appetite. The author alone will set it at 5%.
- The 'Selected NFTs' section to select the NFTs you want to add to the pool, can add up to 4 NFTs, this saves transaction costs as well as time when users want to sell/buy many NFTs at the same time.
After clicking on the 'Create Pool' item, the user will see the pool information as below, the author needs to deposit 0.02 SOL to be able to create a pool and can enjoy 0.03 SOL profit.
Personal view of Goat Swap's future
This project applies AMM to NFT in a similar manner to Sudoswap, although it is still a new paradigm for crypto investors in general and NFT traders in particular. The author believes that the use of the AMM mechanism for NFT is a successful business model for upcoming projects. Goat Swap has the potential to be the platform with the largest market share in this model in the high-volume ecosystem because to the strong and experienced team behind it as well as the positive investor experience the platform offers. It's possible that Solana, which boasts 2 million active monthly users, would directly compete with Sudoswap on the Ethereum network and even Magic Eden within its own ecosystem.