With the recent end of the German government's BTC sell-off, many projects have also fallen below the "golden bottom" after the previous round of rapid decline. The crypto market has ushered in a slow rebound, and the MEME project has also taken the lead and performed well. For investors, this is also an important opportunity to find potential projects and plan for the future.
For this round of bull market, MEME is an unavoidable topic. We all know that the high valuation of VC projects and the unreasonable allocation and distribution of tokens forced market funds to turn to MEME, thus creating the prosperity of MEME. Nevertheless, MEME's strong inherent user base and consensus are also important reasons for its market favor.
However, the market is currently more concerned about homogeneous MEME tokens, while NFT-based MEME is relatively less concerned. NFT-based MEME tokens are subject to certain restrictions mainly due to the depth of transaction circulation, but from the perspective of value, MEME is widely circulated because of "small pictures", so the NFT version of MEME also plays a key role in the ecosystem, and it is currently just lacking an opportunity.
The ERC 404 protocol has therefore come into the vision of developers. ERC 404 is also called a semi-fungible token. ERC 404 tokens have the properties of both homogeneous and non-fungible tokens and can be split and merged. Color Protocol has made further optimizations on this basis and launched BC 404, bringing new gameplay and application scenarios to the industry.
What is Color Protocol
Early NFTs were actually a type of “dyed” homogeneous token. The original intention of Color Protocol was to “dyed” homogeneous tokens, thereby adding community elements with MEME attributes such as pictures to MEME coins, increasing their breadth of dissemination and recognition, and helping MEME coins gain a higher user base and value.
For this purpose, Color Protocol has launched a conversion pool. In short, users can convert their homogeneous MEME tokens into BC 404 semi-homogeneous tokens with NFT image attributes, so that MEME tokens can be displayed, traded, and played in more ways like NFT. Of course, users can also convert these BC 404 tokens into the original homogeneous tokens later, and the whole process will not be affected in any way.
Relatively speaking, we can regard Color Protocol as a launchpad built on MEME collectibles, helping users display and promote MEME tokens, thereby promoting the healthy development of the MEME ecosystem.
Color Protocol's Technical Advantages
BC 404 launched by Color Protocol evolved from ERC 404 and has the dual attributes of homogeneous tokens and non-homogeneous tokens. Users can use this protocol to split and combine tokens, such as fragmenting NFTs into homogeneous tokens, or combining homogeneous tokens into NFTs. The generation ratio of ERC 404 NFTs is fixed. For example, 10 ERC404 tokens can generate 1 NFT, so this ratio will not change from the beginning of token generation.
Compared with ERC 404, BC 404 adds a curve model binding function, and adds a generation curve model in the token generation process, so that the token generation rate or quantity can be controlled according to the generation difficulty, that is, the difficulty of each NFT will increase. For example, the initial ratio is 10:1 for NFT generation. As the number of participants increases, this ratio will increase for each NFT generated, and may gradually become 15:1 later. This situation is similar to the mining difficulty mechanism, which also means that new NFTs are more difficult to generate than previous NFTs, thereby increasing the scarcity and value of tokens.
In this way, each BC 404 NFT token will have a different number of homogenous tokens behind it, and the NFT ID number may not be continuous or start counting from 1#, but counted according to the token content. In addition, the transfer and transaction of BC 404 homogenous tokens will also trigger the destruction of the corresponding NFT, which also means that the NFT ID number will only appear once, and the destruction of BC-404 NFT will produce deflationary properties.
For investors, new NFTs may also generate corresponding premiums relative to homogeneous tokens, thereby increasing the value of NFTs. The increase in the cost of generating NFTs will also increase the scarcity of NFTs, and the uniqueness of the number also makes NFTs more unique, which can derive more gameplay worth exploring.
Color Protocol Recent Updates
In addition to its technological advantages, Color Protocol has also established partnerships with a number of well-known institutions/project parties to jointly expand the scope and scenarios of application. For example, it has reached strategic cooperation with Orbiter Finance, Pandora, UXLINK, Scattering, NFPrompt, etc., and launched corresponding activities to promote the development of the community and the popularization of BC 404.
Color Protocol has already completed the conversion of PEPE and COLORPEPE. The total amount of COLORPEPE is 42 million, of which 80% is generated in the conversion pool, the team is attributed to 0, and the remaining 20% is used for liquidity planning. Later, we can also wait for the official to further launch the conversion activities of other MEME tokens.
Color Protocol currently does not have its own mainnet token, but the official launched the Point airdrop function in April this year. Users who participate in the Point airdrop have the opportunity to obtain the IDO whitelist, become the first batch of conversion pool users, and obtain corresponding quotas. The activity has now ended.
Of course, users who did not participate in the points activity still have other opportunities to get airdrop opportunities. For example, the official recently launched the ORBGUY NFT airdrop rules in cooperation with Orbiter Finance, and conducted snapshot airdrops for COLORPEPE NFT holders and PEPE with ORBGUY holders, and carried out ORBGUY airdrops worth US$50,000.
Participants can purchase and hold COLORPEPE NFT before 14:00 on July 14. The official will take a snapshot to obtain airdrop rewards. It is expected that the official will further increase the empowerment of COLORPEPE and ORBGUY in the future.
Judging from the current official actions, the project party is more focused on empowering COLORPEPE. Behind COLORPEPE is PEPE. In the future, it may continue to launch conversion activities for other popular MEMEs and empower them as well, such as airdrops, etc. Users have lower risks in participating and can obtain higher expected returns.
Summarize
Color Protocol does not produce new MEME, it just reprocesses MEME. Due to the properties of BC 404, there is almost no additional casting cost for users participating in the Color Protocol conversion pool, but there is an overflow value of unlimited imagination for new NFT tokens. In other words, if participants calculate according to the currency standard of participation, there is no risk. For example, in the process of PEPE to COLORPEPE, the value of COLORPEPE will be greater than or equal to the value of the PEPE behind it, otherwise there will be arbitrage opportunities in the market.
In other words, Color Protocol is very user-friendly, and many new ways of playing will be generated based on BC 404, which is of great significance to the activeness of the ecosystem. At the same time, we can also see from COLORPEPE's activities that the official also has the intention to empower the converted tokens and provide holders with more potential value. Coupled with the expected airdrop of Color Protocol, it is worthy of continued attention and participation.
