SFT semi-fungible assets will ignite a wave of innovation in the bull run.

After the Move smart inscriptions have received widespread attention, the SFT(Semi-Fungible Token) semi-fungible asset sector is expected to experience a breakout in the upcoming bull run. As an innovative asset, SFT is bringing new development opportunities to various fields. This article will explore the concept of SFT and potential innovative applications that may arise in the current market environment.

Definition and Characteristics of SFT

SFT originates from Ethereum's ERC-3525 standard and officially became Ethereum's new token standard in September 2022. It can be seen as a combination of NFT and FT, possessing the characteristics of a super NFT. SFT can not only be split and combined but also has greater innovative space and combinability compared to traditional NFTs and FTs. Its unique "container" property and cash flow programming capability make it particularly suitable for the finance and gaming sectors.

SFT Applications in Move Inscriptions

In Move inscriptions, the container capability of SFT is fully demonstrated. Each time an inscription is minted, an equivalent amount of SUI is locked as a minting fee, and users can retrieve their principal at any time by burning the inscription. This mechanism not only reduces the risk for participants but also brings a deflationary effect to the project, attracting a large number of users to participate.

The Innovative Application Prospects of SFT

1. Fully Automated Dividend Agreement

The cash flow programming capability of SFT allows it to implement a fully automated dividend distribution mechanism. Project parties can sell a portion of future cash flow revenues in advance for financing, achieving shared risk. This model is similar to the "drip bridge" in traditional finance, but its implementation on the blockchain will be more efficient and transparent.

2. Web3 Fan/Creator Economy

SFT provides a more flexible asset structure for the SocialFi sector. It can issue multiple types of "NFT" within a single contract, allowing different types to interact with each other while also maintaining independence. This feature makes it possible to achieve "Open Loyalty," where different organizations can share loyalty programs and create more value.

3. Innovative DAO Governance Model

Based on the characteristics of SFT, new types of DAO governance structures may emerge. For example, by issuing smart inscriptions to raise funds to establish a DAO, and designing a profit distribution mechanism based on contributions, incentives can be provided for future contributors.

4. Asset Nested Portfolio

The "container" property of SFT theoretically allows for multi-layer asset nesting, such as loading ETH within an SFT, or loading another SFT within an SFT. This nested structure provides infinite possibilities for asset management and financial product design.

Conclusion

In a market that generally believes this round of bull run lacks innovation and narrative, the development of the SFT track deserves attention. It not only brings new ideas to traditional asset management but also provides more possibilities for the development of the Web3 ecosystem. With the continuous maturation of technology and the expansion of application scenarios, SFT is expected to become an important innovative driving force in the next bull run.