Contemplating Tensor on Solana [Caution: Airdrop speculation]
Solana's recent performance has been nothing short of breathtaking since the drop of JTO, but are we on the cusp of a 2021esque style NFT run too? Tensor could be in the prime spot to benefit in 2024
NFTs are not going anywhere.
This conviction and intuition from the team at Tensor has provided one of the best “Build in the bear market” stories that there is.
Now the market leader, Tensor has the opportunity to dominate 2024.
Contents:
Intro
Origins and finding the niche
User experience and feature highlights
Tensorians, staking and points
Partnership with DRiP
Future TNSR airdrop?
Wrap up
NFT bull run… no.2?
After the mania of 2021-22, the NFT category was written off by many as the market continued to collapse and volumes for digital asset trading fell off a cliff.
Great dashboard and visualization from Sealaunch on the demise of Ethereum marketplace volume as the bear market hit:
Finally, in the second half of 2023, a tsunami of interest and liquidity has recently flooded into the Solana ecosystem thanks to hype from new applications, airdrops and a long overdue repricing in SOL.
A significant portion of this capital has already been allocated to trading NFTs and it seems its possible we could re-live the hype and euphoria of the 2021 PFP meta if it continues.
Origin of Tensor
The founders, Ilja and Richard, started the ideation of Tensor deep in the bear market in 2022, after meeting online via Y Combinator forums during the pandemic and finding that they had similar interests in the Web3 space.
Initially their focus was to develop an NFT pricing oracle off the back of a Solana hackathon, something which eventually got deprioritised due to a lack of demand, or PMF at the time.
For 8 months, it was just the two founders hacking away and working on the development of Tensor and quite literally learning the ‘how’ as they built.
Finding the sweet spot
You would be forgiven in thinking that Tensor is just another NFT marketplace in a sea of applications vying to become the go-to platform on their respective chain(s). Surely the market is oversaturated and we don’t need more?
The aim for Tensor was to differentiate themselves from the competition by catering to the more sophisticated niche of professional NFT traders. By leveraging Solana’s low latency and negligible fees, this also enables much higher volume for a very low cost, and therefore more profitable opportunities.
By no means does this mean the platform is too complicated for regular users, if anything, the Pro-first user-obsessed approach has resulted in a better experience for everyone and has catapulted Tensor to the No.1 spot in most measurable metrics.
See below a very stark visualization for the growth of Tensor when compared to the previous incumbent NFT marketplace - Magic Eden.
The flippening of Magic Eden is no small feat. Even now Tensor are only a team of 10 or so, but as has been witnessed often, smaller more nimble teams can adapt, innovate and solve real pain points significantly quicker than larger businesses.
NFT Type support
One of the most impressive things the team has accomplished is keeping up with the new NFT types which which have been released this year.
Currently supported:
SPL standard
SPL-20
cNFTs (Compressed)
Inscriptions
Read more on Inscriptions here from Helius.
It’s notable that Tensor were the first NFT marketplace to implement Solana Inscriptions support in November as its popularity kicked off on the chain.
Although small, one of the best updates the team have implemented is the ability to filter between these different types on the dashboard, so depending on your poison you’re fully catered for and can filter for what you want to see.
These quick implementations showcase the commitment to staying ahead of the curve and ensuring the best opportunities for users.
We’re constantly fighting a narratives war in this space, it’s no use if it takes a platform weeks to include support for a new NFT primitive, by that point that hype will have faded and the focus will be on the next shiny object.
UX and attention to detail
During the quiet of the bear-market Tensor leaned heavily on their earliest and most passionate user-base for insights into how they were doing and implemented changes and improvements to the platform at lightspeed.
This feedback loop and close relationship to their super-users is a fantastic case-study for what start-ups should do and encourage rapid iterations to 10x user experience.
I’ve included a run down of some highlights of great features below:
Lite vs Pro modes
Yolo Buy
Customizability
DCA Bidding
DRiP integration
Lite vs Pro modes
Choose between a simple and intuitive dashboard or a more trader-oriented experience with charting and analytics thanks to a direct integration to Trading View.
Yolo Buy
One of the coolest new features introduced was a way to gamble and take a chance to buy NFTs for a percentage of their listed cost. If you Yolo Buy with enough SOL, you will also accrue a randomized number of Tensor points which are attributed towards your seasonal rewards
App settings and customization
Trading in any capacity is a competitive business. As part of the approach to be as performant as possible, Tensor has a comprehensive suite of customizable settings for traders to create the most suitable experience for them.
Freeze GIFs for a snappier browser, define AMM risk level and slippage for how you want your orders filled, and even select the default SOL explorer.
DCA bidding (my favourite)
For the sweepers at heart, it is exceptionally easy and ultra fast to sweep collections. However, as with any investment, you may want to DCA your buy points - which can be a manual task on other exchanges.
Through shared escrow you can set up a delta ratio for where you place your declining bids.
E.g. average down with 10 bids which will be filled as floor price declines 5% after every buy
When you decide to sell so you can DCA out of your investments, except this is currently a bit more manual and each sell price has to be entered intentionally as the highest feature floor or overwritten if you have a specific price in mind.
Would love to see this DCA % mechanism also introduced for selling.
Partnership w/ DRiP
The partnership between Tensor and DRiP has developed further - there is now a direct integration and quick ‘Buy’ button for every collection which syncs directly to a dedicated centralized DRiP marketplace on Tensor.
It is the completionists wet dream and removes the hassle of playing around with searches and filters to find the right pieces to fill your collections to 100% the season.
I firmly expect Tensor and DRiP to continue supporting one another and thriving as they both grow together.
Tensorians, staking, points and rewards
Tensor introduced Tensorian shards as a big part of their season 2 rewards program. On completion, these were redeemable for what eventually became Tensorians PFPs - now a collection with one of the highest NFT marketcaps on Solana.
The concept of Tensorians is that they, and their community, will be inextricably linked to everything that happens with Tensor. As an avid user of the platform you can invest in a piece from the collection, stake it directly on the platform to accrue Tensor points each season for rewards.
One of the wildest stats anywhere in the space is the staking ratio for Tensorians which is currently over 80% in a 10k collection…
Community is everything in Web3. The benefit of Tensorians is that they have built an incredibly strong and passionate network of superusers who will advocate for the platform.
Close to 100mil worth (currently) of rewards have been given back to the community of Tensor users so far.
This investment back to the users, in my opinion, will support an absolutely massive growth of the platform during the incipient bull-run.
Anyone who was around during Blur’s inception will know how quickly the transfer of interest, capital and volume fled from OpenSea. The same thing happened to Magic Eden with Tensor points - and they haven’t even needed to release a token yet to achieve this.
Season 3 wrapping up and $TNSR rumours…
After many months, the third season for Tensor will be coming to a close soon and the leaderboard will be reviewed for reward drops.
There are a number of ways users can accrue points towards rewards; trading i.e. buying and selling, bidding on NFTs, staking Tensorians and yolo buys, to name a few.
It’s also possible to boost your points gained through loyalty and referrals, here is my referral below where you can get 5% extra points:
For each person you refer, you gain 10% of their points earned and 5% of fees.
If you got this far and haven’t already I’d recommend getting signed up and share your referral to your network to start boosting and get ready for season 4.
TNSR airdrop wen?
Its rumored, similarly to Blur’s approach, that Tensor will eventually release a token of some kind which will in turn be airdropped as seasonal rewards.
Although I wouldn’t be surprised that this happens eventually, I’m semi-skeptical that this is in the short-medium term since it was only a few months ago when Tensorians were released, which technically exists as a defacto exchange token i.e. fee bonuses, ability to stake and earn rewards.
Tensorians are currently worth around $9k each… which, for those who were fortunate to mint numerous, is an especially generous drop. It could be a hot take, but I still think for what Tensorians represent - with their staking ratio, the flywheel of future rewards and the social element - they are wildly undervalued.
It was mentioned by the founders previously that they will leverage the Tensorians and the community to achieve success for Tensor - organic evangelism is something that every marketing team on the planet would die for, so it makes sense to me that holders will be handsomely rewarded for as long as it yields value back to Tensor.
As mentioned earlier, the best ways for you to become a recipient of a potential airdrop is to trade or own a Tensorian, but admittedly a lot a folks would be priced out of owning one at the current price.
My recommendation, especially if you’re an avid NFT collector, is to just organically use the platform whenever you’re looking to trade or buy into a project. Tensor also makes it extraordinarily easy to bulk buy and sell, so if you have the patience you can build up your points as a market-maker with huge sweeps.
Blur had one of the biggest airdrops in history and currently sits at around $1.5bil FDV, its safe to say that it’s likely that if Tensor does a drop it’ll likely sit close to it if not higher due to newer hype surrounding the platform.
Follow @rektasaurus69 and check out their predictions on what the price of an airdrop could be:
Wrap Up
One of my predictions in 2024 is that Tensor becomes the overwhelming leader in the NFT marketplace space.
I’m convinced of this simply because of what the founders have managed to achieve in such a short period of time, with a very small team, in what is a competitive landscape and during one of the roughest times to kick off a start-up during the 2022 bear - it really is staggering.
The alpha here is; bet on founders that forge results from following their natural intuition.
The main risks I see is that Web3 communities can be fickle and if sentiment changes or holders don’t feel that they’re being understood or listened to, it can have the adverse effect of defining your downfall as a founder or platform - we have seen many examples of this happening.
It’s difficult to reel in expectations once they have exceeded beyond a certain point.
However, I’m very confident in the team and excited to see them smash it in 2024!
Thank you so much for reading.
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See you in the next one.
f.