{"id":784,"date":"2022-05-02T17:37:47","date_gmt":"2022-05-02T17:37:47","guid":{"rendered":"https:\/\/grandpascrypto.com\/?p=784"},"modified":"2022-05-02T17:37:50","modified_gmt":"2022-05-02T17:37:50","slug":"what-is-index-coops-nft-index-fund","status":"publish","type":"post","link":"https:\/\/grandpascrypto.com\/what-is-index-coops-nft-index-fund\/","title":{"rendered":"What is Index Coop\u2019s NFT Index Fund?"},"content":{"rendered":"\n<p><em><strong>tl;dr Summary:<\/strong> Index Coop, a decentralized and autonomous asset manager, just released their NFT Index token called JPG. The token, traded on decentralized exchanges like Uniswap, provides the JPG token holder exposure to the trends of the NFT market. In short, the token\u2019s value fluctuates based on changes in the underlying NFT\u2019s it derives its value from.<\/em><\/p>\n\n\n\n<p>On April 19, Index Coop announced the launch of their NFT Index token, JPG. This token represents one of the first NFT index tokens ever created and looks to provide token holders with a broad exposure to the NFT market. While this isn\u2019t the first index token created, it is the first to provide such a broad exposure to the overall NFT industry.<\/p>\n\n\n\n<p>In the <a href=\"https:\/\/www.prnewswire.com\/news-releases\/index-coop-announces-launch-of-game-changing-nft-index-product-301534602.html\">words of the Index Coop Methodologist<\/a> who designed JPG, &#8220;JPG is a game-changer.&#8221;<\/p>\n\n\n\n<p>But if you are anything like me, then you might still be stuck on what the heck an index is\u2026 So, in this article, let\u2019s break down: what is an Index? What does Index Coop do? And what about this NFT Index token is so special?<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">You asked for an NFT Index product!<br><br>\ud83d\udce3 Introducing\u2026 <a href=\"https:\/\/twitter.com\/search?q=%24JPG&amp;src=ctag&amp;ref_src=twsrc%5Etfw\">$JPG<\/a><br><br>TheNFT Index <a href=\"https:\/\/t.co\/rxcJ4zCUvO\">pic.twitter.com\/rxcJ4zCUvO<\/a><\/p>&mdash; Index Coop | \ud83e\uddcaeth (@indexcoop) <a href=\"https:\/\/twitter.com\/indexcoop\/status\/1516780112443633667?ref_src=twsrc%5Etfw\">April 20, 2022<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p><strong>Indexes 101<\/strong><\/p>\n\n\n\n<p>An index, in its most basic definition, is a measure of something. The word \u2018index\u2019 is commonly used in the world of capital markets to describe a type of investment vehicle. For example, you might be interested in investing in semiconductors because you have been hearing a lot about them in the news but don\u2019t really want to invest in one specific company. There is an index fund that allows you to put your assets in one fund that then distributes your assets to multiple semiconductor companies. Simply put, an index fund is a basket of securities that attempts to track the performance of something.<\/p>\n\n\n\n<p>So now that you understand what an index is, how does it work? Well, if you invest money in an index, the fund will take the money you gave it and allocate it to the different companies that they feel appropriately measure a trend\/market. In the same manner, if you take your money out, then the fund sells positions based on its allocations and provides that money back to the individual.<\/p>\n\n\n\n<p><strong>JPG Index Token<\/strong><\/p>\n\n\n\n<p>Index Coop takes the concept of an index from traditional finance and offers a <a href=\"https:\/\/youtu.be\/nHhAEkG1y2U\">Web 3.0<\/a> version of the investment vehicle on the blockchain. By capturing the upward movement of different areas in the crypto space through an index token, Index Coop believes it can provide crypto natives and newbies with an easy-to-understand, secure and tax efficient way to participate in crypto investing. So then, how does this apply to their newly launched NFT index token?<\/p>\n\n\n\n<p>The JPG index token created by Index Coop attempts to do the same thing as traditional indices but is innovative in a few ways.<\/p>\n\n\n\n<p>1)&nbsp; &nbsp; &nbsp; <strong>Tokenized:<\/strong> The index is a token rather than security you can buy on the stock market<\/p>\n\n\n\n<p>2)&nbsp; &nbsp; &nbsp; <strong>Liquidity:<\/strong> The index provides a measure of a largely illiquid market<\/p>\n\n\n\n<p>3)&nbsp; &nbsp; &nbsp; <strong>Index Weights: <\/strong>The holders of the JPG index token can vote on allocations<\/p>\n\n\n\n<p>The JPG index token accomplishes this by reinvesting the money it receives from the token into other tokens related to the NFT market. While an NFT index would usually be impossible to create because of an inability to quickly buy and sell NFTs when users invest or sell JPG tokens, Index Coop is able to guarantee liquidity through new protocols. Thus, JPG is backed by ownership in fractional NFTs, NFT liquidity vaults, NFT curation DAOs, NFT currencies, and wrapped NFTs. For example, DeFi projects such as <a href=\"https:\/\/nftx.io\/\">NFTX<\/a>, <a href=\"https:\/\/whale.me\/#r1\">WHALE<\/a> and <a href=\"https:\/\/www.jennynft.io\/\">Jenny DAO<\/a> help make up the allocations of the JPG index token.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Want to get into the NFT space but don\u2019t know where to start? Or perhaps you\u2019re an avid NFT collector looking for a core position of blue-chip NFTs? 1\/n<\/p>&mdash; The JPG NFT Index Token (@jpgNFTindex) <a href=\"https:\/\/twitter.com\/jpgNFTindex\/status\/1518711019408969731?ref_src=twsrc%5Etfw\">April 25, 2022<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>As a result, JPG index token can now provide its owners exposure to rare and expensive NFTs such as CryptoPunks, Bored Ape Yacht Club, Meebits and Tyler Hobbs\u2019s Fidenza while still allowing Index Coop to quickly buy and sell the index\u2019s underlying tokens. This second component of quickly buying and selling the underlying tokens creates liquidity for Index Coop so that token owners don\u2019t have restrictions on when they want to exchange JPG.<\/p>\n\n\n\n<p>On top of this, owners of the token get to vote on the allocation of the JPG index token. If a stakeholder in the coin is unhappy with how much of the index is weighted towards WHALE, then they can vote to reduce that weighting. This voting dynamic gives users more agency when engaging with JPG so they can make the token into the digital security that they desire.<\/p>\n\n\n\n<p><strong>NFTI<\/strong><\/p>\n\n\n\n<p>While Index Coop has pioneered the space of Index Tokens, they are by no means the only player in the space. NFTI is another index token that has emerged in 2022 which has shown the promising potential of tokenized digital securities.<\/p>\n\n\n\n<p>Similar to JPG, NFTI attempts to track the performance within the NFT industry. It does this by weighting their index based on each token&#8217;s circulating supply and liquidity value. This provides a somewhat larger scope to their index as it not only includes NFT ownership, but it also provides weighting on the technologies that support NFTs as well.<\/p>\n\n\n\n<p>To further differentiate themselves, NFTI has also allowed their token to be redeemable by owners. This specific feature allows owners to exchange their NFTI for a token that is weighted in their index. This interchangeability is a unique feature to NFTI and showcases how tokens can further drive innovation in indexes.<\/p>\n\n\n\n<figure class=\"wp-block-image is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/i.gyazo.com\/389b62788575a315e56988b667b73c9a.png\" alt=\"\" width=\"696\" height=\"108\"\/><figcaption>Source: https:\/\/indexcoop.com\/jpg-nft-index<\/figcaption><\/figure>\n\n\n\n<p><strong>Conclusion:<\/strong><\/p>\n\n\n\n<p>If you look up Art Index Fund today, the closest thing you can find to an Art Index Fund on Web 2.0 are those offered by Masterworks or Yieldstreet. For both of these companies, the best they can offer an investor is a security that represents fractional ownership of individual work of art. They can\u2019t offer a broad Art Index Fund because there is no way to directly back their security in the value of a broad range of art pieces.<\/p>\n\n\n\n<p>While the nuance of an NFT Index might not immediately sound impressive, the challenge that Index Coop and NFTI continue to solve is one that Web 2.0 has struggled with for years. Innovations like this showcase the potential of Web 3.0 to continuously innovate around challenges in Web 2.0 no matter how small they are.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Index Coop, a decentralized and autonomous asset manager, just released their NFT Index token called JPG. The token, traded on decentralized exchanges like Uniswap, provides the JPG token holder exposure to the trends of the NFT market. In short, the token\u2019s value fluctuates based on changes in the underlying NFT\u2019s it derives its value from.<\/p>\n","protected":false},"author":2,"featured_media":751,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[55,56],"tags":[1094,1108,1091,1090,364,363,1089,1100,1093,1087,1096,1099,1088,477,1106,1102,1092,1105,101,1097,1101,1095,1103,352,1104,1098,1107],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v18.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/grandpascrypto.com\/what-is-index-coops-nft-index-fund\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What is Index Coop\u2019s NFT Index Fund? - grandpascrypto.com\" \/>\n<meta property=\"og:description\" content=\"Index Coop, a decentralized and autonomous asset manager, just released their NFT Index token called JPG. 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