Upshot, a distributed ledger blockchain protocol that pays experts to give opinions on nonfungible token appraisals, today announced that the company has raised $7.5 million in Series A funding to expand its operations.
This round was co-led by Framework Ventures, CoinFund, Blockchain Capital and others.
The rise of NFTs, which exist as cryptographic tokens on blockchains, has changed the landscape of the cryptocurrency industry because the tokens can represent virtually anything from digital artwork to video game pets such as the CryptoKitties from Dapper Labs Inc. to virtual sneakers.
The problem? Nobody knows exactly how to appraise NFT artwork and items. Some NFTs go for pennies and some sell for millions of dollars.
Prominent examples include a piece of NFT artwork from digital artist Beeple who created “Everydays: The First 5000 Days,” a collage artwork that sold for over $69 million in March, and the “Disaster Girl” meme, a picture of Zoë Roth – who is now a college senior – standing outside a fire when she was four years old, which sold for $500,000.
In order to find these answers, Upshot brings together groups of experts and rewards them for reliable and credible information, in what’s known as the wisdom of crowds. The company’s first product, known as Upshot One, resides on the Ethereum blockchain.
“Upshot’s mission is to capture the value of truth and to give people novel ways to get paid for their unique insights,” said Upshot Chief Executive Nick Emmons. “Our goal with Upshot One is to create near real-time price feeds for NFTs through crowdsourced appraisals.”
The NFT industry is still nascent, and services and marketplaces are still forming for numerous different types of items. The market covers virtual artwork, items in video games, apparel for virtual avatars, trading cards, virtual pets and even physical items, including artwork, clothing and wine.
“For years, nonfungible tokens were thought of as an illiquid market,” Jake Brukhman, founder and chief executive of CoinFund. “Through Upshot’s incredibly important work in peer prediction oracles, we will lay the foundation for financial services on the NFT asset class by providing on-chain appraisals and pricing for these assets. Upshot is a zero to one innovation for both decentralized finance and NFTs.”
As a new digital asset class, NFTs suffer from a lot of market confusion when it comes to how to price them. Upshot represents an appraisal service that brings together experts who can receive compensation for their opinions and clients who can rely on that expert information.
“In addition to creating value for the NFT market, Upshot will also unlock opportunities for a new generation of appraisers and catalyze powerful new innovations in the field of decentralized finance,” said Emmons.
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