Aavegotchi is revamping the traditional NFT drop process with the innovative Bid-to-Earn auction model. Usually, NFT drops take place through a normal auction, which has only one winner. But, with Bid-to-Earn, all bidders in an auction will walk away with something.
Aavegotchi is gearing up for a major auction within their Haunt 2 and Gotchiverse Realm, featuring 30,000 NFTs. In a run-up to this, Aavegotchi has kicked off a three-day dry run. This auction will culminate at 2 PM UTC on July 18.
What is a Bid-to-Earn Auction?
Most NFT drops follow the First Come First Serve (FCFS) model. However, this model “doesn’t serve anyone well,” says Nick Graves, Director of Marketing at Aavegotchi. Graves has participated in many NFT drops, all of which turned out to be “stressful” and induced fear, uncertainty, and doubt (FUD).
“By its very nature, NFT drops result in a small portion of buyers acquiring the NFTs and a majority of the demand (i.e. the faithful community) left on the outside looking in,” Graves tells NFTevening.
Aavegotchi itself has faced the same issue. In one instance, while 10,000 Haunt 1 Avaegotchis were sold out in under a minute, they were “not evenly dispersed,” he notes. While auctions are an alternative, the normal auctions have one problem: there will be only one winner.
Thus, faced with these issues, Aavegotchi decided to adopt the Bid-to-Earn auction system. It was developed by GBM Auction, a new crypto-native auction system, which debuted during the 2020 Cryptograph NFT auction.
With the Bid-to-Earn system, Aavegotchi is rewarding participants for bidding. This means that every time someone is outbid, they will be compensated with percentage rewards. In this way, everybody earns, not just the person who wins the auction.
Furthermore, the model “accounts for bots, eliminates gas wars and puts more Aavegotchi GHST tokens and NFTs back in your wallet,” Graves adds.
How does the Bid-to-Earn system work?
In the ongoing new wearables auction, users can bid on various wearables, including Gamer set and Steampunk set. When someone else outbids the user, Aavegotchi will refund their bid amount. Along with this, they will receive an additional payout, which can range from a minimum of 1% to a maximum of 10% of the difference in bid amount. The site will immediately credit both the refund and payout to the user’s wallet.
The amount of payout the user gets depends on the higher bid, Graves explains. For example, consider an original bid of 200 GHST. Here, the user can earn a total return of anywhere between a minimum of 201 GHST and a maximum of 210 GHST.
Additionally, there is no minimum bid—a user can bid any amount they want. Meanwhile, whenever someone places a bid during the last five minutes, the site will extend the auction by five minutes.
According to Graves, their current auction is doing “extremely well”. Within the first 24-hours of the auction, 11,810 bids were placed, amounting to a total earning of 69,089 GHST.
Those who wish to participate can head over to the Aavegotchi Aauction House. Here, all the auctions will show up in real-time and users can place their bid on the Bid page.
Next month, Aavegotchi will be back with a Haunt 2 auction. It will feature 15,000 portal NFTs and new wearables, Graves notes.
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