Economics behind AW Land Shares

This article will explain you how AW Land Shares work and economic mechanisms behind them.

Photo by Abigail Lynn on Unsplash

The main problem with NFTs: whales

Don’t get me wrong: the blockchain ecosystem needs whales. They are pionniers and take significant amount of risks. They deserve to be rewarded when they bet right.

However, the issue with NFTs is that they exist in limited supplies and a whale won’t fully use them 24 hours a day, 7 days per week. Who will have enough hands or time to use those 768 swords/shovels/cryptokitties?

The answer? Fractional ownership!

Hence comes a possible solution: dividing valuable NFTs in shares and splitting responsibilities between assets owners and their users.

I‘ve started to explore that way by tokenizing lands I own on the blockchain game Alien Worlds. When I purchased them, land price tags were around $300–$350. They were thus very expensive for most players. The issue is that it is player engagement that generate value (see below). Something must be done to keep them involved.

My solution is to issue 100 shares, give 30% of them to active players over time and sometimes selling them at a fair price (you can find shares lying around at $20 on AtomicHub right now).

I believe this model aligns all interests: miners have a reason to mine on my lands, shareholders enjoy passive incomes and I, as the asset owner, will do everything I can to promote my assets.

You said “passive incomes”?

My AW Land Shares are currently backed by two lands on Magor. Owning a single share entitles you to exactly 1% of all incomes generated by these lands. There are currently two income streams:

  • When miners mine on the lands, shareholders will get 5% of their income (aka mining commission).
  • Every week, land owners get a special allowance. As a shareholder, you will receive your part too.

Payment are done at least once a day in Trilium (TLM), the native token of Alien Worlds. TLM is fully exchangeable against WAX, and then other cryptoccurencies.

What’s next?

You’ll find some ideas on the last part of the FAQ. Some of them, like voting, are still far away and I am covering basics (user awareness, bulletproofing the payment system, communication…) first.

Want to be a part of the project?

NFT Share is not related with Alien Worlds or AtomicHub in any way. Feel free to send a mail at nftshare@protonmail.com for further information.

Building the first NFTs fractional ownership system on WAX. Join me at: https://nftshare.net