A new Solana-based NFT protocol, All.Art is contributing towards NFT licensing rights and introducing novel NFT liquidity pools.
Non-fungible tokens (NFTs) have exploded in popularity this year, and in doing so, they’ve revolutionized digital art. NFTs unlock innovative monetization models and make it possible to truly own and sell digital art.
However, NFTs are still bound by the technical limitations of the blockchain platforms that support them. And if they’re to have real staying power, NFTs need legal clarity around licensing and offer owner benefits beyond speculative trading.
What is the All.Art Protocol?
All.Art is a protocol currently being developed on the Solana blockchain that promises to solve some of the NFT market’s primary pain points.
First, by building a new style of Automated Market Maker (AMM) liquidity pool, All.Art will add liquidity to the NFT marketplace and make buying and selling easier. Second, All.Art addresses some of the legal issues around NFTs by introducing a new NFT standard with embedded license rights called NFT-PRO.
All.Art will run on Solana, differentiating it from protocols based on Ethereum and other leading chains. All.Art can offer its users fast and efficient L1 transactions. This means that minting costs are more affordable, and there will be no environmental concerns.
Who Is Behind All.Art?
The All.Art protocol is currently running on testnet, but its origins date back to 2017 when its founder Vitomir Jevremovic had the idea of integrating blockchain-based art trading into virtual exhibitions. Jevremovic is the CEO of VR-All-Art — a Zug, Switzerland-based platform for artists, galleries, and museums to exhibit art through virtual reality.
The All.Art protocol is the progression of VR-All-ART with the addition of blockchain technology. The team behind it has released SolSea — the first open NFT marketplace on Solana with embedded licenses, FTX-Pay support, indexes, and many more features. They were also among the winners of the Solana Season Hackathon and created the first virtual reality exhibition of Nikola Tesla.
How Does the All.Art Protocol Work?
All.Art’s two most important innovations are decentralized NFT swap pools and the new NFT-PRO standard layered on top of the protocol. The pools are intended to boost NFT liquidity, and the standard is intended to inject licensing rights directly into every token.
Here’s how the system works: Each NFT created on All.Art is represented by its own subset of tokens called license ownership rights tokens or LORTs. LORTs are not fractions of the NFT. Instead, they give holders the ability to own licenses for that NFT, and here’s where All.Art’s unique licensing scheme comes in.
NFT-PRO Standard
Under NFT-Pro, there are multiple types of license rights a user could choose to purchase. Each of these contains different information with different types of associated legal rights. To keep things simple, NFT-PRO groups the licenses into a three-tier system.
Tier 1 — the core data layer consists of the metadata that uniquely identifies an NFT
Tier 2 — the license rights data layer has terms and conditions for each license
Tier 3 — the transaction layer records cAMM pool interactions and other sales mechanics
If a user wants to represent an item on the blockchain, all they need is the first tier, i.e., the metadata. However, if they wish to sell it, tier 2 and a contract of sale or license transfer are required. If they want to sell it on-chain, level three is required. In effect, this new standard clearly defines license rights for every NFT and eliminates the scenario where an investor buys a piece of art without knowing what they’re actually purchasing.
Capped Automated Market Maker (cAMM) Pools
The other primary issue All.Art aims to solve is liquidity for on-chain NFT trading. This problem is addressed with the creation of a novel automatic market maker system. Here’s how that works in practice.
When an All.Art NFT is created, it comes with 150 LORTs, 100 of which are put into a pool while the remaining 50 go to the creator's wallet. To buy that NFT, a collector needs to purchase LORTs and lock them into the license to meet the price set by the artist. Once this is done, the collector is granted a license token that proves their ownership. They can then either hold it, return for it the original amount of LORTs, or sell to another user. Meanwhile, the artist gets a share of the sale by cashing their original 50 LORTs for the funds deposited by the collector.
This all takes place in programmatically controlled Capped Automated Market Maker (cAMM) pools. These pools are designed to boost liquidity, and each one has a mixture of LORTs and the protocol’s native AART tokens. Each pool also limits how many LORTs it can hold, which is essential because it ensures that an artist gets paid for their work.
AART tokens
The AART token is the fuel for the All.Art ecosystem — connecting cAMM pools and acting as a link to outside capital, both stablecoins and fiat currencies. For any investor to purchase an NFT on the All.Art platform, they need to buy AART tokens from the open market.
By introducing a token, All.Art enables easy swapping of NFT-PROs’ LORTs, as they are all collateralized in the same unit of exchange. The AART token is set for a public sale in Q4 2021. For more information about the sale, follow the official All.Art account.
All.Art Future Outlook
With the NFT booms, new projects and protocols are launching every day. However, when it comes to NFT platforms, few offer much in terms of real innovation. All.Art, on the other hand, has an ambitious roadmap laid out with a mainnet launch, community rewards, and a public token sale scheduled in the coming months.
All.Art aspires to create Uniswap-like liquidity pools for NFTs. In addition to pioneering a new standard for NFTs. They’re integrating the protocol with existing VR exhibition capabilities and working on a digital wallet that will act as a bridge connecting Unity game developers and the Solana blockchain.
Should All.Art succeed, they will need to onboard a critical mass of creators and investors, and if they do that, they’re likely to become a mainstay in the Solana ecosystem. To this end, the SolSea marketplace could be the key with its potential to attract a wide audience of NFT enthusiasts interested in its new licensing standards, low transaction costs, and high speeds.
