As it turns out, NFTs are not a fad.
There are solid numbers behind these unique assets.
Let me throw in some interesting statistics:
Did you know that OpenSea’s trading volumes soared past $10 billion in November three months after crossing the one-yard ($1 billion) mark? What’s more, a Blockchain Alliance Group (BAG) study found that the number of NFT users, especially in gaming, rose 24X from above 25k to over 750k in the first nine months of 2021 alone?
We can go on and on.
The common mistake critics make when dismissing NFTs and their potential is the fixation of digital art. Indeed, a big part of NFTs is the proliferation of boring auto-generated digital art now selling for millions—if not more. Crypto Punks made a name for itself and rightly so because Larva Labs, the minter, created the project to test out the tech and not expressly to make money. The 10k Punks were airdropped for free. Those who agreed, even reluctantly, are now in green—and (greedily) looking for the next opportunity.
This clamor for the next big thing explains why the NFTs space now commands billions, finding integration in diverse sectors of the real economy from gaming to art and even eCommerce. And where money talks, the quest to stand out, be the first in a highly competitive and growing sphere is proving cut-throat.
What is Sweeping the Floor in NFTs
And this is why a new trend is emerging: “Sweeping the floor” in NFTs, buying en masse.
Undoubtedly, sweepers are FOMOing and aiming for their newly acquired assets to “moon” in the shortest time possible.
Are you still following?
Well, it is tough being in crypto—new jargon, every time, everywhere; it’s frustrating.
No worries, I will be your translator.
First, to where it all began: FOMO—Fear of Missing Out.
Remember when Bitcoin “mooned”? Remember when Bitcoin rallied?
The surge from $20k to $40k then to $68k drew many investors, most of whom didn’t want to miss out. This fear continued to pump prices.
FOMO in crypto trading is a bullish sentiment indicating high demand for a cryptocurrency asset tradable either in a centralized or decentralized exchange.
Not to be outdone, the NFT community derived their variant of FOMO in “sweeping the floor.”
Simply put, to “sweep the floor” in NFTs is when a specific project buys all its minted NFTs at the floor price. The Floor price is the minimum “ask” or the lowest price an NFT can be sold. When all listed NFTs are scooped at the “floor,” the buyer is said to have “swept the floor.”
However, sometimes a single buyer or a project can’t be behind the sweep. Whenever there is a positive development around a given NFT project and all of a sudden buyers buy its listed NFTs in bulk at the floor price, that qualifies to be a sweep.
Whenever an NFT floor sweep happens, assets are bought in bulk.
Why Users “Sweep the Floor”
Remember that floor sweep is almost always automated to execute trades faster without drawing attention from the market.
Therefore, it is common for new but highly potential project NFTs to be swept using searcher bots immediately on mint. After the sweep, the purchaser has an advantage and can then sell these newly acquired prices at a higher “floor price,” essentially flipping them for profit.
The motivation could be profit maximization for enterprising collectors.
Sometimes, the objective of “sweeping the floor” is to save on trading fees.
Ethereum remains the most active NFTs minting platform that’s expensive to transact on. This has forced developers to innovate, realizing “sweeping” NFT bots to automate the purchase of digital assets for different users in bulk, saving Gas fees.
In Ethereum, Genie is democratizing the broom, allowing for purchasing up to 60 NFTs across different Ethereum-based marketplaces, including Rarible and OpenSea, in one single sweep (transaction). It has emerged to be the preferred NFT aggregation tool that bundles together purchases saving on Gas fees and time.
Whenever a sweep happens, buyers are also shielded from reactive market shifts. In the last week of December 2021, Scott Gray, the founder of Genie, said the aggregator had moved over $25 million in trading volumes, pushing its trading volumes to over $125 million generated from more than 10k users.
Democratizing the Floor is Both Good and Bad, depending on the Application
From another lens, this—and similar tools—could also open the door for whales to manipulate markets. By acquiring assets in bulk cheaply, they will easily arm-twist market participants, unnecessarily bidding the price of assets higher—out of reach of the project’s retail fan.
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