Controversial NFT marketplace LooksRare has rolled out a new rewards campaign that entitles those listing their NFTs for sale to a financial reward paid in LOOKS tokens. The new listing rewards program will boost liquidity by rewarding users for listing NFTs for sale on the platform. 250,000 LOOKS per day will be distributed among everyone with eligible listings.
- LooksRare introduces LOOKS rewards for listing the top 25 NFTs
- 250,000 LOOKS per day will be distributed among eligible users
- The campaign intends to increase liquidity and incentivize growth
- LooksRare incentivized users to increase trading volume artificially
The announcement marks the biggest structural shakeup since launching in early 2022. FirstLook shook the NFT market with their newly launched platform to surpass the leading NFT marketplace OpenSea. However, they did this by employing some debatable tactics. At launch, LooksRare users gained LOOKS for simply trading NFTs, which led to some bad actors trading them amongst themselves for inflated fees to earn more rewards.
Nonetheless, digital collectible enthusiasts can earn LOOKS rewards by trading, staking, and now, by listing an NFT for sale on LooksRare. However, some early speculators did some quick math and checked the details. They revealed that to earn any proper rewards, a user would need an NFT within the top 10 most expensive collectibles.
How it works
When you list NFTs from the top 25 collections featuring the listing rewards icon, you’ll earn points every ten minutes, as long as listings and collections meet the criteria below.
- The listed NFT is from one of the top 25 eligible collections ranked by rolling 24-hour volume (ranking updates every 10 minutes)
- The listing is an active and executable order
- The listing price is within 1.5x of the global collection floor price, i.e., the lowest floor price on either OPENSEA or LooksRare
In addition to the above criteria for individual listings, NFT collections must meet the following criteria to be eligible for listing rewards.
- Total item count of 20,000 or fewer
- Greater than 0% royalties
- Conform to ERC-721 token standard. Unfortunately, ERC-1155s and other standards introduce too many complications in the calculation methodology.
An important point here is that collections identified to be artificially increasing trading volume to increase their collection volume rank will have their eligibility removed. A move signaling that while LooksRare may have employed some debatable tactics to get where it is today, it’s now looking to go straight and take OpenSea’s crown.
The trading rewards allocated in the LOOKS tokenomics were always intended to encourage trading volume. Since listing rewards are volume incentives, LooksRare directs 250,000 of those 1,4 million daily trading rewards to the new program. After the initial rollout, LooksRare states it may adjust the listing rewards program and use tokens from other sources if all goes to plan.
Key Dates?
- 09:00 UTC Apr 20th, Listing reward points will start being recorded
- 09:00 UTC Apr 21st, The first listing rewards calculation
- 11:00 UTC Apr 21st, The first listing rewards payout
Why LOOKS Rewards?
The strategy behind the campaign is simple, liquidity. The more NFTs for sale at a reasonable price, the more people will use and trade on LooksRare. You can now earn LOOKS tokens for staking LOOKS to earn staking rewards and by buying or selling any NFT on LooksRare for trading rewards. The latter has been a vital first step in boosting the trading volume on LooksRare and translates directly into increasing the WETH earned by LOOKS stakers.
Despite a meteoric rise, LooksRare wants more volume, and increasing liquidity. Simply put, the higher the number of NFTs available for purchase on LooksRare, the more buying and selling takes place on the platform.
Not only that, but the liquidity also needs to be within a good price range, or collectors may just go elsewhere to buy at better prices. The listing rewards program also promotes listing at a price close to the floor price and LooksRare even provided a PFP frame template for those that wish to list at a lower price and attract eyeballs.
Who can take part?
As mentioned users need a top 25 NFT by 24-hour trading volume on LooksRare, a ranking table that can change rapidly but still contains stalwarts such as BAYC, Azuki, and Terraforms, but interestingly not CryptoPunks.
The campaign, while favoring those that hold high-value NFTs, has been designed in such a way as to increase liquidity and overall trading volumes on LooksRare. However, we expect it to be criticized as the sensational title of the announcement would have most believing this is simple cash for listings deal. In reality, it’s nothing of the sort.
On the other side, one thing it might do is stimulate sales of the top 25 NFT collections by reward hunters. As NFT markets organically enter a lull period after such a buoyant 2021 these tactics not only benefit LooksRare but the entire NFT market.
The LooksRare NFT marketplace has constantly released products that showcase their consideration for the community. Furthermore, inorganic or wash trading activity dropped quickly after the initial LOOKS mining rewards halved. These token rewards incentivized inorganic trading behavior and boosted the platform initially, helping it surpass OpenSea and gain serious attention. While OpenSea seemingly drags its heels, LooksRare is on an all-out offensive, and this writer predicts a changing of the guard by the end of 2022.
The above does not constitute investment advice. The information given here is purely for informational purposes only. Please exercise due diligence and do your research. The writer holds positions in various cryptocurrencies, including BTC, ETH, and RADAR.
