Summary
NFT marketplace Magic Eden has introduced a user rewards program centered around its diamonds, which were launched in 2023. The platform plans to distribute diamonds to “Solana OGs” retroactively. Magic Eden has also decided to open-source its protocol code and grant governance rights to the newly-formed Non-Fungible DAO. This move reflects a trend of using non-trading “points” to incentivize user behavior amid increased regulatory scrutiny in the crypto industry.
Key Points
1. Magic Eden has created a user rewards program based on diamonds, offering benefits such as lower fees and access to whitelists. Users can earn diamonds by buying, selling, or making offers on NFT collections, and by exclusively using Magic Eden for their NFT trading. However, there is frustration over the lack of clarity regarding the usefulness of diamonds, as they are not tradable.
2. The use of non-trading points in crypto projects is gaining popularity as a means to incentivize user participation. Other examples include friend.tech’s points program and Drift Points by Solana-based exchange Drift. Points are seen as a temporary solution while projects navigate regulatory challenges in the crypto industry.
3. Magic Eden has not provided a clear explanation of how diamonds relate to points. However, the platform claims that the rewards program is a carefully designed plan to benefit Magic Eden’s original users, collectors, creators, and traders.
4. In addition to the diamonds rewards program, the newly-formed Non-Fungible DAO now owns and governs the smart contracts of Magic Eden. The DAO has also announced the future issuance of a token, suggesting that community members will be able to earn it by engaging with Magic Eden.
5. Details about the Non-Fungible DAO are limited, but Magic Eden has pledged to contribute to the DAO to support industry growth. This move aligns with a broader trend of decentralized autonomous organizations gaining prominence in the crypto space.
By offering a user rewards program and embracing open-source governance, Magic Eden aims to engage its community and navigate regulatory challenges. The use of non-trading points reflects a growing trend in the crypto industry, while the creation of the Non-Fungible DAO aligns with the rise of decentralized governance models. These developments highlight the ongoing evolution and innovation within the NFT marketplace.