Arweave is undergoing a series of underlying innovations, from UDL to UCM, and the creator economy has always been a field that Arweave hopes to focus on, and within it, the role of NFTs is crucial.

On one hand, the NFT-ization of assets has been a widely discussed topic in the industry. From the initial craze around art NFTs to the hopes of using NFTs for anti-counterfeiting and anti-censorship mechanisms, they have ultimately faced setbacks. The rise of Blur has demonstrated that generating hype efficiently is the key to popularizing small images, while Azuki’s “misbehavior” has highlighted that artistic value is not the primary focus for some projects.

On the other hand, the non-standardization of the creator economy cannot effectively connect with homogeneous tokens. RWA may be a valuable direction, but the process of how on-chain creations without real economic value can be completed off-chain and then back on-chain is difficult to justify, resulting in a dark humor similar to “Catch-22” situation.

To address the failures of NFT in terms of anti-counterfeiting and censorship resistance, it is important to focus on organizing effective production behavior within the system. This includes examining the on-chain production system itself and finding ways to improve it.

Production can be divided into material production and spiritual production. However, the production of cultural and spiritual aspects, which encompasses cultural products on the blockchain, has long been underestimated in terms of enthusiasm and importance. Unfortunately, the mainstream Web3 community and even the more mainstream Web2 population fail to recognize the significance of this type of production. If we were to consider the value of speech on Friend Tech to be as valuable as Bitcoin, particularly in terms of economic value, most people would think it’s a delusion.

However, it must be pointed out that the existing methodology of Web3 research focuses too much on examining the economic value of any product under the DeFi model. It considers this as a free market for transactions, without recognizing whether this market itself is established, treating it as a prerequisite.

This is similar to traditional new institutional economics, which believes that “clearly defined property rights are a prerequisite for market transactions, and the protection of property rights is a condition for the continuity of market transactions. The property rights system ensures the incentive for market participants to engage in transactions.”

But the market itself is a public good, a product of political institutions and legal systems. Therefore, a reasonably positive fiscal and financial system has special significance for maintaining the efficient operation of the market. On the one hand, only centralized power can possess efficient administrative capabilities. An overly decentralized power structure may increase transaction costs and lead to more rent-seeking behaviors, ultimately resulting in higher transaction costs for market participants.

On the other hand, before a unified market is established, some speculators often rush ahead through franchises or licenses and become part of the institutional system in the subsequent marketization process. This is already a standard practice in today’s L2 sorters and the arrangement of special nodes, where the name of decentralization is used while pursuing centralization for profit.

The Time is Ripe For Disintermediation

In decentralized trading platforms, Arweave has significant applications, and future trading markets can achieve the following effects by using Arweave and various DApps within its ecosystem:

1. Complete transparency and traceability: An important feature of blockchain technology is its public and immutable ledger. On decentralized trading platforms, all transactions and related information are recorded on the blockchain, which can be viewed and verified by anyone. However, this transparency and traceability will be replaced by various algorithms, such as Ethereum’s use of Danksharding technology, which no longer retains complete transaction history. Arweave, on the other hand, inherently avoids scalability issues and can include complete transaction history, ensuring storage durability for at least 200 years.
2. Elimination of intermediaries and cost reduction: Traditional trading platforms usually require intermediaries or third-party validation nodes to facilitate and settle transactions. On Arweave, atomic NFTs can be divided and resold arbitrarily, eliminating the role of intermediaries and NFT platform custodians. As a result, trading platforms can reduce the costs associated with intermediaries and lower transaction costs.
3. Security and tamper-proof: Arweave permanently stores records, ensuring that each data copy is replicated nearly a thousand times. All transactions are recorded on the blockchain and undergo multi-node validation, ensuring the authenticity and integrity of transactions. For example, the award-winning project ProtocolSign at the Arweave Asia Summer Hackathon stores signed legal-grade text on the Arweave network to obtain the most trusted storage security.
4. Compatibility with any asset type: By using Arweave, decentralized trading platforms can facilitate global transactions. Due to the characteristics of blockchain technology, trading platforms can transcend national borders without being restricted by traditional financial systems. This allows trading platforms to provide a more convenient and open trading environment for global users. Whether it’s fungible tokens or various types of NFTs, UCM has received recognition from Sam and has the ability to trade any on-chain asset, including traditional fungible tokens.

A truly open and free trading market, if built on a traditional centralized platform, will inevitably lead to a tendency of centralized control. Only by being fully constructed on Arweave can it possess the significance of a new era, breaking free from all the limitations of the old era and sailing towards boundless freedom.

In traditional trading markets, intermediary institutions play important roles, such as banks and securities companies. However, the emergence of Web3 technology has brought the possibility of eliminating intermediary institutions in trading markets. Through Arweave, transactions can be conducted directly between participants, without the need for intermediaries to verify and settle transactions.

For example, the earliest form of decentralized peer-to-peer behavior in the form of currency transfer, represented by Bitcoin, is described in its whitepaper as a peer-to-peer electronic cash system. In traditional payment behavior, transactions require clearing companies and third parties, but in DEXs, transactions are conducted directly between participants. Participants can transact using their own digital wallets, without relying on banks or other intermediaries.

The absence of intermediary institutions enables cheaper and faster transactions. For instance, the Lightning Network of Bitcoin achieves millisecond-level transactions, whereas the Bitcoin mainnet operates with a ten-minute interval. Moreover, the decentralized nature of blockchain technology ensures the integrity of transaction records, thereby enhancing transaction security. All transaction records are stored on the blockchain and can be viewed and verified by anyone, reducing the issue of information asymmetry.

When the blockchain network evolves on top of Arweave, based on its underlying technology that eliminates scalability concerns, the SCP (Storage Consensus Protocol) applications built on top can achieve complete on-chain transaction capabilities and high off-chain compatibility, in order to fulfill the historical mission of mass adoption.

In traditional centralized trading platforms, transparency and traceability of transactions are often limited. However, Web3 brings decentralized trading platforms that achieve higher transparency and traceability through blockchain technology.

Taking the decentralized trading platform Uniswap as an example, it is a decentralized trading protocol built on the Ethereum blockchain using smart contracts. On Uniswap, all transactions are recorded on the blockchain and can be viewed and verified by anyone. This means that anyone can trace back to the initiator of a specific transaction, the amount of the transaction, and the timestamp of the transaction, among other information. This highly transparent transaction mechanism can effectively prevent potential fraudulent behavior and provide greater trust.

In addition, Uniswap employs the mechanism of automated market makers (AMMs), which automatically match buy and sell orders through smart contracts, eliminating the role of intermediaries and exchanges on traditional trading platforms. This means that transactions no longer rely on centralized institutions, but are conducted directly on the blockchain through smart contracts. This decentralized trading mechanism further enhances transparency and traceability of transactions, as all transactions are public and can be supervised and audited by anyone.

And on top of Arweave, the SCP-based DEX Permaswap can achieve almost infinite transaction speed and 0 Gas Fee. It only requires real-time online LP to efficiently match transactions. Under the incentive mode of Permaswap, the network’s load capacity and user base expand in the same direction. That is, the more users there are, the more advantageous it is for LP to increase liquidity, and the wider the scope of transactions on the network.

To some extent, it can alleviate the pressure on the network caused by the growth of user base. The infrastructure for transactions has been built, and the only thing lacking is market awareness. From the user’s perspective, Permaswap is an intent trading market where users only need to focus on the transaction content without worrying about transaction capability. The higher the transaction frequency and the more participants, the more profitable it will stimulate for the participants. This is a new model of win-win for all parties involved.

Intent-Centric: Introducing Smart Contracts

There are many improvements in the application of smart contracts in the free trading market. One important improvement is the automation of transaction execution. In traditional trading markets, buyers and sellers need to rely on intermediaries or exchanges to execute transactions, which can result in transaction delays, additional costs, and trust issues. However, in Web3, transactions can be automatically executed through smart contracts, eliminating the need for intermediaries and providing a faster, more efficient, and transparent trading experience.

For example, let’s consider two individuals, Alice and Bob, who wish to conduct an atomic transaction involving NFTs. In traditional trading markets, they would typically be required to utilize an exchange, whether it’s a centralized exchange (CEX) or a decentralized exchange (DEX). The existence of the platform itself cannot be circumvented. Initially, they would need to deposit or link their digital currency to the exchange’s account system, and subsequently await confirmation and execution by the exchange, which may entail a certain duration of time. Additionally, the exchange would levy a fee, which is a common characteristic of CEXs, DEXs, as well as FT and NFT exchanges.

However, in Arweave, they can use everPay to transact directly. They can create a smart contract on Smartweave, encoding the details and conditions of the transaction into the contract. Once the contract is created and deployed on Arweave, the transaction can be automatically executed. When Alice sends the digital currency to the contract address, the contract will automatically transfer the assets to Bob’s address, and both parties can view the details and status of the transaction on Arweave, ensuring transparency and traceability.

By automating transaction execution, Web3 provides a more convenient and efficient way of trading, reducing the involvement of intermediaries and the time cost of transactions. At the same time, the automated execution of smart contracts enhances the security and reliability of transactions, as the execution is done by code rather than relying on human intervention and judgment.

To further improve transaction efficiency, various bundle tools can be integrated, such as Arseeding, which directly uploads various assets to Arweave. By using data compression mechanisms similar to Rollup, the cost-effectiveness ratio can be significantly improved.

You can imagine this process as the automatic scoring process in football, where the audience doesn’t need to explore the specific rules of the game, but merely understands the relationship between football and the trophy to know which team ultimately wins.

One important aspect of applications on Arweave is the removal of human errors and fraud risks through the automatic execution of contracts. In traditional trading markets, contract execution relies on manual operations, which can easily lead to human errors or fraudulent activities. However, in everPay, the automatic execution of smart contracts ensures that contracts are executed according to predetermined rules, reducing the possibility of human errors.

Another advantage is the elimination of intermediaries, further reducing fraud risks. In traditional trading markets, intermediaries play important roles but also face issues such as information asymmetry and conflicts of interest. In Web3, Arweave can directly connect the two parties in a transaction, eliminating the intervention of intermediaries.

Furthermore, fraud risks can be reduced through decentralized trust mechanisms. In traditional trading markets, trust is usually built on the basis of intermediaries or government regulations. In Arweave, decentralized trust mechanisms can be established through atomic assets and atomic transactions. For example, on Permaswap, users can directly engage in peer-to-peer transactions without the need for any intermediaries for matchmaking. The presence of LP ensures the atomicity of transactions, guaranteeing the complete execution of transactions. Any conflicting element with the user’s intention will result in the failure of the entire transaction, eliminating the possibility of partial success or failure.

Providing Web2-level transaction settlement efficiency

SCP theory is a solution based on “off-chain computation, on-chain recording” that aims to provide faster transaction confirmation and settlement efficiency. everPay achieves this by establishing a multi-chain payment channel network, allowing users to conduct fast and low-cost transactions within the everPay channels without recording every transaction on Arweave. When users need to finalize the results on-chain, everPay uses Bundle technology to submit a package of transaction results to Arweave. The advantage of everPay is that it can achieve almost instant transaction confirmation and settlement, greatly improving transaction efficiency and user experience.

In addition, everPay is also a culmination of cross-chain technology, which refers to the technology of asset transfer and trading between different blockchain networks. Traditional payment protocols typically only support asset transactions on the same blockchain, while everPay enables seamless transfer and trading of assets on different blockchains. The application of cross-chain technology allows users to conveniently trade on different blockchains, while also increasing market liquidity and participation. Currently, everPay supports six public chains, including EVM and Polkadot, and in the future, it will provide complete support for various heterogeneous chains.

Furthermore, everPay natively supports various RWA assets. Tokenized assets or RWAs refer to the process of converting real assets (such as real estate, stocks, etc.) into digital tokens through smart contracts. Through tokenization, these real assets can be traded and transferred on the blockchain, thereby improving transaction convenience and operability. The application of tokenized assets can bring more opportunities and flexibility to the free trading market, while also providing investors with more choices and liquidity.

For example, as mentioned earlier, ProtocolSign has already begun early theoretical exploration of equal rights for real estate leasing and sales. In more practical scenarios, wine is an area that it is more optimistic about, ensuring the secure transfer of ownership on various chains through Arweave’s efficient settlement capabilities.

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