Asset Pricing

Pricing Assets

If buyout is enabled, the price of an asset is reflected in index shares. Individual assets can only be bought out by using shares of that index. Therefore the true “price” of an asset is dependent on (1) the amount of SOL that the Curator has determined the asset is worth relative to the total Curator-determined value for the pool (2) the price of a share. When a Curator changes the relative prices of an asset in a Dynamic Index, the total value (supply of shares) of the index remains the same but each asset is priced differently relative to one another.

Implied Share Price = 100 SOL / 10,000 shares = 0.01 SOL (Original)

Asset
Curator-Set Value
Buyout Price
Asset A
10 SOL
1000 shares
Asset B
30 SOL
3000 shares
Asset C
40 SOL
4000 shares
Asset D
20 SOL
2000 shares
Total
100 SOL
10000 shares
Imagine NFTs increased in value (relative to SOL) by 10% and the floor for C doubled. The curator would want to change the the relative value of Asset C and would expect the share price to increase. The new total implied value in the pool is 154 SOL, indicating a total value increase of 54% which should be mirrored by an equivalent increase in the share price.

Implied Share Price = 154 SOL / 10,000 shares = 0.0154 SOL (New)

Asset
Curator-Set Value
Buyout Price
Asset A
11 SOL
714 shares
Asset B
33 SOL
2142 shares
Asset C
88 SOL
5714 shares
Asset D
22 SOL
1429 shares
Total
154 SOL
~10000 shares

Asset Buyout

Assets can only be bought out from Curated Indexes marked “Asset Buyout Enabled”. Assets can also only be bought out using shares from that Index. Once an asset is bought out, shares are burned by the vault, reducing the supply and net asset value, theoretically yielding no impact on the share price. An example of the impact on prices is below.

Implied Share Price = 100 SOL / 10,000 shares = 0.01 SOL (Old)

Asset
Curator-Set Value
Buyout Price
Asset A
10 SOL
1000 shares
Asset B
30 SOL
3000 shares
Asset C
40 SOL
4000 shares
Asset D
20 SOL
2000 shares
Total
100 SOL
10000 shares

Implied Share Price = 80 SOL / 8,000 shares = 0.01 SOL (New)

Asset
Curator-Set Value
Buyout Price
Asset A
10 SOL
1000 shares
Asset B
30 SOL
3000 shares
Asset C
40 SOL
4000 shares
Asset D (SOLD)
20 SOL
2000 shares
Total
80 SOL
8000 shares

Adding Assets

Assets can only be added by the Curator to Curated Indexes marked “Dynamic”.. Once an asset is added, new shares are minted to the creator based on the value prescribed by the creator. If the asset is priced fairly, there will be no implicit impact to share. There will be a greater supply but also a greater Net Asset Value of the Index. An example of the impact on prices is below.

Implied Share Price = 100 SOL / 10,000 shares = 0.01 SOL (Old)

Asset
Curator-Set Value
Buyout Price
Asset A
10 SOL
1000 shares
Asset B
30 SOL
3000 shares
Asset C
40 SOL
4000 shares
Asset D
20 SOL
2000 shares
Total
100 SOL
10000 shares

Implied Share Price = 120 SOL / 12,000 shares = 0.01 SOL (New)

Asset
Curator-Set Value
Buyout Price
Asset A
10 SOL
1000 shares
Asset B
30 SOL
3000 shares
Asset C
40 SOL
4000 shares
Asset D
20 SOL
2000 shares
Asset E
20 SOL
2000 shares (MINTED)
Total
120 SOL
12000 shares
Copy link
Outline
Pricing Assets
Asset Buyout
Adding Assets