The Potential and Innovative Applications of SFT Semi-Fungible Assets

With the explosive popularity of Move smart inscriptions, the potential of semi-homogeneous assets (SFT) in the upcoming bull market is becoming increasingly apparent. This article will explore the concept and characteristics of SFT, as well as the innovative opportunities it may bring to various fields.

Definition and Characteristics of SFT

SFT(Semi-Fungible Token) is derived from the ERC-3525 standard of Ethereum and officially became a new token standard of Ethereum in September 2022. It can be seen as a combination of NFT and FT, representing a super NFT with greater innovation space and composability.

The main features of SFT include:

1. Split and combine
2. Having the "container" nature
3. Cash Flow Programming Capability

These features make SFT particularly suitable for the complex asset structure design in the financial and gaming sectors.

SFT Applications in Move Inscriptions

In the Move Inscription Protocol, 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 reduces the risk for participants while also bringing a deflationary effect to the protocol.

Potential Innovative Applications of SFT

1. Fully Automated Dividend Agreement

By leveraging the cash flow programming capabilities of SFT, smart contracts can be designed to automatically manage and allocate project revenues. This model allows project parties to sell a portion of future cash flow revenues in advance for financing, thereby sharing the risks.

2. Web3 Fan/Creator Economy

SFT provides a more flexible asset structure for the SocialFi track. It can issue multiple types of "NFT" within a single contract, facilitating cross-creator collaboration and "Open Loyalty" programs.

3. Innovative DAO Governance Model

Based on the fair issuance of inscriptions and the automatic dividend mechanism, SFT may give rise to a new type of DAO governance structure. For example, a DAO could be established through fundraising by issuing smart inscriptions, with profit distribution mechanisms designed according to contributions.

4. Asset Nested Portfolio

The "container" characteristic of SFT supports multi-layer asset nesting, such as having ETH inside an SFT or having SFT inside another SFT, providing more possibilities for asset management and interaction.

Conclusion

SFT technology has brought new innovative space and narrative to the current market. As more projects begin to explore the application of SFT, we have reason to expect that SFT will showcase its unique value in various fields such as DeFi, GameFi, and SocialFi in the upcoming bull market.