JPEGz - NFT market capitalization Index

Nick Sawinyh on 10 Jan 2023

Hello! What’s your background, and what are you working on?

Hi, I’m Joe Sticco, a lifelong trader and asset manager. In 2014, I purchased my first Bitcoin and sold it shortly after, realizing a small profit. In the summer of 2016, I began researching, accumulating, and holding various tokens. In 2018, I was soon inspired to create something to benefit the crypto ecosystem. This turned into Co-Founding Cryptex Finance alongside Preston Van Loon and Thomas Matzner in 2019. I left my former life and never looked back.

Cryptex Finance is a DAO that builds fully decentralized index solutions for global DeFi users worldwide.

Examples thus far are TCAP, a Total Crypto Market Capitalization Index, and JPEGz, an NFT index representing 10 collections weighted by their respective current market capitalization.

JPEGz is a synthetic index that provides utility for a system user to track real-time market capitalization of these 10 NFT collections, without the need to own any of the underlying collections themselves. JPEGz index components are Bored Ape Yacht Club, CryptoPunks, Mutant Ape Yacht Club, Azuki, CloneX, Doodles, VeeFriends, Cool Cats, World of Women, and Cryptoadz.

Real-time NFT market capitalization data of these collections is powered by Coinbase Cloud. It is then aggregated and verified on chain via Chainlink. This index data is then further aggregated by Cryptex.

JPEGz, now representative of this data, is then minted and burned by system users via an over-collateralized vault system. JPEGz will be launching on the Arbitrum Network in Q1. It represents the second synthetic index from Cryptex Finance, with many more to come.

What’s JPEGz backstory?

With NFT/ WEB3 still being in its infancy, Cryptex wanted to approach this space in a data-driven way that provides DeFi users worldwide the opportunity to track an index of NFTs, without the need for holding any of the underlying NFT assets themselves.

Similar to how the total crypto market capitalization has continued to evolve with Layer 2 networks, blockchain infrastructure, gaming, and security to name a few, it is possible the NFT space can follow a similar path as it matures into different subsets, indexes and sectors.

Such examples can be product rewards and loyalty points, redeemable retail product drops, music, and album sales, entertainment, etc. All of which can then be indexed and provide utility to users. Until then, we have JPEGz.

The goal of JPEGz is to continue Cryptex’s mission of creating unique, fully trustless and fully decentralized products that are backed by on-chain data.

What went into building JPEGz?

About a year of development went into JPEGz as there were and are a lot of moving parts. Some of which include:

Defining index methodology and system parameters, getting the oracles created based on liquidity and data accuracy requirements, deciding where it was best to launch (Arbitrum), securing partnerships, building the smart contracts, building the front end and getting the system ready and tested.

Cryptex DAO contributors worked extensively on all of these items. Since then, our industry has evolved in a sense that for better or for worse, more people are aware of it everyday, and that creates discussion, research and interest.

Shoutout to Chainlink and Coinbase Cloud for building the oracles, Quantstamp for auditing the CTX bridge, Arbitrum being an amazing partner and of course the Cryptex DAO.

What’s your business model?

Cryptex does not sell tokens. There are no ICO’s, presales, or pre-mines. From a security perspective, the DAO works to have all systems audited and to build open-source software that is always accessible to the world.

The DAO generates money through burn fees within the software, there are no fees to mint any Cryptex Product, but there is a burn fee which goes to the treasury. How treasury funds are then used is decided by governance token holders.

I try not to look at anyone as competitors, any one building in the space should be building for the greater good of the communities they serve. We are different as we are looking to create access to data metrics whilst widely quoted are inaccessible, thats the mission we look at whilst building. The target market is anyone interested in indexes, rather than just buying coins.

What are your goals for the future?

Building cool stuff and innovating. I’ve never looked at this in terms of personal wealth or personal goals, rather what I can contribute to this space to make it better. Everything else that comes with it is a by-product of innovation and leading. Our goals are to put JPEGz, TCAP, and CTX into the hands of the world in a fully decentralized and trustless manner.

What are your future thoughts for the DeFi market?

While we face challenging times as an industry, I am inspired daily by the builders and people in the space that I communicate with. There are so many people across this industry who, on top of being wonderful human beings, are beyond brilliant thinkers, creators and developers. I believe that in time, ultimately they drown out a lot of the short term noise and lead DeFi to the very bright future it deserves.

Where can we go to learn more?

DeFi is coming. Don't get left behind

About the author
Nick Sawinyh
Nick Sawinyh is a crypto entrepreneur based in LA. He founded DeFiprime in 2019 to offer information on emerging DeFi ecosystem. He owns small amounts of different cryptocurrencies.

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