We are in the business of bursting bubbles.
Today we are launching the first of our family of Forkast Labs indexes. To start, this set of indexes will measure the NFT economy. It is the first step to ultimately becoming the most sophisticated measurements of the tokenized world.
Our flagship Forkast 500 NFT Index will provide the cleanest view to-date from a multi-chain perspective, tracking thousands of projects from 21+ protocols and monitoring the truest look of the overall market. We factor out wash trading and other suspicious trading behavior so that investors can fully understand the market environment and participate with the greatest transparency possible. It measures the performance of the global NFT market and can include assets on any blockchain: consider it a proxy of the entire NFT market.
We’ve also introduced two important subsets of the overall Forkast 500 NFT Index: Forkast ETH NFT Composite and Forkast SOL NFT Composite indexes. Each measures the performance of each protocol’s NFT market and currently scans 2,000 eligible smart contracts on any given day. More are coming.
Because we’ve been in the market of monitoring, tracking, standardizing and indexing multi-chains — we look for behavior and markers without championing any single protocol. In the coming days, months, and years — you’ll get an increasingly sophisticated view of how the industry is truly performing and have better tools to decide how you want to interact with the web3 market as an investor. In fact, we’ve already started.
Just this past week, our team identified what’s now close to US$1 billion worth of artificial inorganic trade (some would call wash trading, we call it gaming behavior) that should be stripped out in order to evaluate true overall NFT market activity as Blur and OpenSea go head-to-head for market dominance in the market.
Why is this important?
If you were an investor, you might have thought that NFTs are back and rushed to buy in. That would have been the wrong thing to do. Our data shows that much of the “growth” in activity centered on gamification of trying to get airdrops, instead of authentic new participants bringing liquidity to the NFT marketplace. In fact, overall, our Forkast 500 NFT index reveals that the overall the market is sloping down from its YTD January high. This will change, as will sentiment, and market action — but at Forkast Labs, we apply the greatest value we can apply to the industry — to take an agnostic and holistic multi-chain view.
Our thesis is simple. We see the world accelerating very quickly into the digital economy — defined by tokenized assets along with cryptocurrencies. The trendline has always been less about price, but about use case and adoption. NFTs reflect both use cases and representations of a desired asset. As NFTs can be data wrappers for all kinds of digital assets – not just collectibles – they will have a critical role to play in a future digital economy.
But the indexes and the data available today have not reflected the sophistication of the technology, its data, or the complexities of market behavior. In short, we’ve been underserved and at worse, misled by the current measure of “value” and economic activity because the primary indicators available to the industry have been price and sales volume. The market deserves better.
Data transparency is how we’ll get there.
