Totally love the idea of a NFT Index - though my initial concern is the market cap and liquidity of the constituents. For indices that are launched, they’d ideally be able to grow to $50M+ in market cap and the underlying liquidity be able to support large purchases ($50k+) in a single transaction.
Also, could you help describe a go to market plan on how this could potentially be really huge?
I would also say that this proposal should include sharing the thought process behind why the assets are weighed as they are, because this is going to be important in the future.
First of all, what should the project be doing to be considered for the NFT Index? Because I can understand why most of the picks are there, but not for dego. To me, that just looks as risky as adding FARM or PICKLE to the DPI
DPI has a whole host of criteria for what can be considered for it, and I think you’re going to need to double down a lot on defining criteria. If it’s a marketplace, should it hit a certain threshold of volume to be considered? If it’s a game, does it need to hit a threshold of players? Do we take games under development, or does the game have to have launched something playable?
And how would the NFT index be different from a Gaming Index? (Which I would propose if there were more games actually playable) Will this try to keep a stable ratio between art and gaming and whatever category DEGO and MEME are? How would this adapt to future new categories?
Interesting questions.
The concept of “NFT” is broad and encompasses multiple use-cases. It’s almost as broad as the concept of “ERC20” (or could become as broad).
Examples :
There are probably more types, but I can already distinguish a subcategory : The collectibles.
(2) and (3) probably don’t really fit in this category even though they might or might not be NFTs.
(1) is a complicated one, as a domain name can be used both productively or speculatively. However you can also argue that an in-game item can also be used “productively” given that you care enough about the game.
Thus, I’d consider (1), (4), (5) and (6) to fit into the Collectibles category.
Following this reasoning, the concept of Collectibles is still large but kind of gives an indicator about which projects are eligible or not. The concept only overlaps with @DarkForestCapital’s Metaverse Index Proposal on point (4) (in-game items), but that section is also one that features lots of tokens such as $MANA or $SAND. Today those are used as a currency to purchase virtual items (as far as I understand). If we exclude those, we decide the exclude tokens that are used as currency to purchase NFTs. Thus, do we exclude $MEME as well (one doesn’t use directly $MEME to purchase NFTs but needs to stake them) ? Or do we focus on generalized NFT marketplaces governance tokens such as $RARI (but it doesn’t only propose collectibles) ?
Intuitively, I’d said that anything that is linked to collectibles should be eligible, regardless of a strong intersection with the Metaverse Index - weighting could be totally different which still makes it a totally different index. If we choose to exclude what intersects with a Metaverse Index, then maybe it’s a little bit too soon to talk about an NFT/Collectibles Index.
I really love the idea, and we definitely need to launch something around NFTs at some point. Nonetheless I agree with @setoshi: this space is not large enough for the moment, which may result in a small AUV on the short term. Furthermore, i’m not confortable with the tokenomics. Why these tokens are valuable ? I’m not talking about the NFTs themselves, but the governance/network tokens powering the issuance/redemption of NFTs. I would prioritize other indices such as the one proposed by Coinshare (Gold&BTCÐ) before moving to smaller caps. But, we should not wait too long, as we don’t want to create an index before it’s too late 
Hi!
Thank you for participating.
Totally love the idea of a NFT Index - though my initial concern is the market cap and liquidity of the constituents. For indices that are launched, they’d ideally be able to grow to $50M+ in market cap and the underlying liquidity be able to support large purchases ($50k+) in a single transaction.
R: Well, it’s hard to predict the future or the exact potential of each asset, the markets are most of the time irrationals, in particular, I see a lot of potential in most, but I have this concern in mind, that’s why the rebalance and hours dedicated daily as described in the proposal should be able to track all markets and liquidity to protect the investors, e.g following the proposal methodology, two or three assets above should be rebalanced in the next window due to MC > $5M, just an example.
Today we have:
$MANA with $84M in market cap
$SAND with $20M in market cap
$GHST with $9.5M in market cap - most assets locked on OKEx (critical case)
$RARI with $3.7M in market cap
$MEME with $3.3M in market cap
Also, could you help describe a go to market plan on how this could potentially be really huge?
R: Here is a basic plan:
The NFT community is growing fast. There are people dedicated (working) to get their monthly income, e.g I know people in brazil playing Axie Infinity (AXS) game to pay their bills, so these people with the real case are the right people to talk about it. The first plan is to hit this public to collect feedback.
The second plan is to refine a product that must hold the attention, plus a product that needs to work very well until the next rebalance without concerns, based in the market, and trust.
The third plan, at the begging the NFT pulse index product (website, design) must be (bigger) than marketing.
The fourth plan, general marketing, Indexcoop database, setprotocol database, expertise, Twitter, etc.
< REPEAT >
Obs.: I tend to agree that may we have to wait to create that, the next year must be the right year for this, but we need to plan now.
Hi, thanks for your feedback.
I replied to the @setoshi right now, so probably there is something in there that can reply to this, as agreeing about the moment.
I would also say that this proposal should include sharing the thought process behind why the assets are weighed as they are, because this is going to be important in the future.
R: It was shared in the proposal, but there is no doubt, the rebalance, methodology, research, daily hours are important to protect the users.
First of all, what should the project be doing to be considered for the NFT Index? Because I can understand why most of the picks are there, but not for dego. To me, that just looks as risky as adding FARM or PICKLE to the DPI
R: DEGO has been removed, because it was moved to BSC as described above.
DPI has a whole host of criteria for what can be considered for it, and I think you’re going to need to double down a lot on defining criteria. If it’s a marketplace, should it hit a certain threshold of volume to be considered? If it’s a game, does it need to hit a threshold of players? Do we take games under development, or does the game have to have launched something playable?
R: As described in the proposal, everything will be considered as being criteria, for each individual asset, following your category, it’s an MVP, so need to breakdown this for sure.
The NFT Pulse Index aims to track NFTs projects that have significant usage and show a commitment to ongoing maintenance and development, max supply, products live, assets sold on-chain, owners, users’ growth, community, governance space between owners and community, team support, volume, roadmap, not necessarily in that order.
And how would the NFT index be different from a Gaming Index? (Which I would propose if there were more games actually playable) Will this try to keep a stable ratio between art and gaming and whatever category DEGO and MEME are? How would this adapt to future new categories?
R: What can an NFT represent? That is the NFT Pulse Index.
NFTs can be used to represent all of these things… and much, much more. They have the potential to modernize the lucrative collectibles market, eliminate fraud in the entertainment industry, open up new possibilities in gaming, and allow someone to own a real-world asset that’s thousands of miles away.
NFTs are overhyped now. Its still not here. The CT bubble makes you believe everyone is paying lot of ethers for NFTs. Its just not true. Volume can be gamed. Dont be naive.
My concern on DEGO was more specifically what made you think it was a valid NFT project to begin with? From where I was looking, it looked more like another yield farming project trying to capitalize on NFT hype. That kickstarted my concerns about how this list is vetted.
Because for your Project Traction Characteristics, you mention that it must have launched for at least 90 days, and must have a clear product. But all things considered, GHST doesn’t have a working product at all, just got the basic early minting functionality, but not a testnet of game functionality. And it’s weighted in your proposal at 20%.
I’m really asking because with your assets left (RARI, GHST, SAND, MEME, MANA), two of those are games without a playable game yet. And games come with a lot of risk, and if I wanted to get this index, I want to be assured that it would be safe by reading some strong vetting criteria.
So the criteria of: " The protocol or product must have been launched at least 90 days" is still far too vague for me. Does an alpha count as a launch? What if they’ve only launched their token?
Also, my confidence in your ability to execute this isn’t helped by two things:
When viewing the earliest iteration of your proposal, it had a longer list of tokens. @Kiba asked what made you change from the initial proposal to what you’ve chosen, and your response was a vague sentence and implied you could add more. Which really concerns me, because what other projects are there to add? More random farming + NFT projects?
Your fees give 20% to you, the proposer, and 10% to some NFT expert. This just implies to me that you yourself are not an NFT expert, and that’s really concerning. What is this other NFT expert supposed to do, and why can’t you as the Methodologist fulfill it? And if you don’t even have the NFT expertise, why do you deserve so much for “maintenance+research+networking with NFT community involved+methodology checks”? Especially when as far as I can see, there’s no concrete methodology yet.
I’d agree with that premium if say, Opensea or dclblogger or Andrew Steinwold was in charge of this, but they’re not.
So, to summarize, here are the questions I’d like concrete answers to:
Hi Owls 
how about calling it Open Sea Index $OSI?
Team up with Open Sea, the leading platform for trading NFTs to issue an Open Sea Index $OSI.
This would allow to leverage their brand the same ways as with DeFi Pulse Index.
An nft fund is a great idea, but instead of having tokens like rari, mana, meme, etc… we should incorporate NFTX.org D1 and D2 tokenized funds.
I’m talking an index coop token with underlying PUNK, KITTIE, AVASTARS, AXIE, and others. NFTX can be the methodologist.
These funds have millions of dollars in actual ‘blue chip’ NFTs locked in balancer pools. The tokenized funds will launch on Jan 5.
I will invest in most of these funds, and so are many others, but if they were part of a single token DPI-style, it would be a game-changer.