Hey folks, so with all the uncertainty in the cryptomarkets right now, there’s been a slow bleed (or accumulation however you look at it) in many altcoins right now. One of the ones that I’ve been looking at particular is $FORE, the native token of Fore Protocol, which has recently retraced its price to all the way back to last October:
With price now going to 3-month lows, this means that this may be the last time you’ll able to mint one of $FORE’s Analyst NFTs for this cheap —a price of 1,000 $FORE (or roughly $65 dollars worth at time of writing) to mint.
First, what does an Analyst NFT even do?
Fore’s Analyst NFTs enters you into Fore’s ecosystem of decentralized bookmaking, as one of the 3 roles of Creator, Player, and Analyst:
After a market is created by a Creator and the Players place their bets on their predicted outcomes, the Analyst’s role is to validate the market — usually within a 24-hour timespan, the market is eligible for validation:
With an Analyst NFT, there are significant benefits and risks, meaning that a Analyst’s role is perhaps the one with the greatest responsibility.
Analyst Benefits
There’s a pretty significant upside to validating different markets, and hypothetically if you were able to validate markets with extreme efficiency, you could potentially be earning greater than 900% APR.
With each market validated, analysts have the potential to earn up to 2% of the total volume of that market, a rate that differs depending on what the level your NFT may be:
Starting out at Blue, your NFT can essentially level up, which gives you a better reward multiplier depending on how many successful validations you have completed, with black being the highest at a multiplier rate of 1.225x:
The rewards above are the normal reward rates for Analysts, yet currently there’s a Fast-Tracking promotion where until March 1st, new Analysts are eligible to “fast track” their rewards, earning as a slightly higher reward multiplier as they go up the tiers:
It’s important to note that there are two different gauges at play here — rewards and power. When you initially mint your NFT you start out at 1,000 power, but as you continue to correctly validate markets, you start earning power which can be withdrawn as $FORE tokens. By simply not withdrawing your power, you could easily start compounding your rewards, essentially boosting your earnings into the triple-digit APRs:
The greater your total NFT power is, the greater the share of the 2% total market value you’ll receive, which incentivizes analysts to validate quickly and early.
Validation Risks
Validating markets can be extremely profitable but it also can be extremely risky, as an incorrect validation can either lead to the burning of your Analyst NFT (There’s been talk about the introduction of a strike system in V2), or at the very least if there’s a dispute against the validation, your NFT might be tied up in the dispute until it gets resolved. Therefore it behooves the validator to choose markets that have outcomes that are easily verifiable, such as ones that have a clear Yes/No answer and/or if there is no reliable source that confirm the actual outcome.
Disputes — If your market’s results are in fact disputed, either a high guard (an analyst with a Black NFT) or the folks at UMA may be tasked in order to resolve the dispute. Either way, real human intervention comes in to make sure that markets are resolved and payouts are delivered appropriately.
My Takes and Considerations
Adoption is key: As with any DeFI protocol, Fore’s success will primarily depend on its ability to gain mass adoption. Their main competitor, Polymarket, resolves the majority of its disputes through UMA and conducts all of its markets through USDC (as opposed to an altcoin), yet provides no incentives for its users to do so. $FORE is considered pretty hyper-deflationary and has mechanisms to incentivize people to create their own markets and validate them. Despite these incentives, without significant liquidity and adoption, gamblers will ultimately go to the market that can provide the biggest payday, which I think is ultimately why Polymarket (still) has significantly larger TVL.
Low-marketcap = High Volatility: $FORE has an extremely small marketcap of barely $60 million dollars FDV, which means that the price could increase (and decrease) significantly depending on whale pressure. Additionally, with several levers to help burn tokens (NFT minting, 1% burned upon market creation, etc.), this should theoretically put price pressure on $FORE to go up as the protocol gets more utilization.
Conclusion
Can Fore gain the adoption it needs to be successful? Last month when I wrote about $FORE, the token had a little over 900 unique holders — a number that’s increased to nearly 1200 at time of writing. Additionally, two weeks ago they announced that they hit a creation target of their 500th market so there are definitely signs of some traction getting built.
Regardless, with the price of $FORE today I’m speculating that we might not be able to see an Analyst NFT mint price this cheap again. If you disagree, or if you’ve already been validating markets, I’d be keen to hear about your thoughts and experiences in the comments below. If you haven’t tried Fore yet, but you’d like to give it a shot, consider supporting this blog and use my referral link to get a 50 $FORE!
And as always, thanks for taking the time to read this and be sure to follow me on twitter (https://twitter.com/CryptosWith) to get all my latest updates. Also, looking for a gift for your Crypto-loving/hating friend? Give them a REKT journal to cheer them up!
Disclaimer: And as a final reminder, this is not financial advice and this is for educational and entertainment purposes only. Please as always, do your own research and find what investments are best for you. Cheers everyone!