What is Muse? Your ultimate guide to Muse DAO’s token
Can Muse help revolutionise the way we buy NFTs?
- A basic introduction to NFTs
- The problem with buying NFTs
- NFT20: Solving a problem?
- MUSE and Muse DAO explained
- Facts and figures
The Muse DAO and the MUSE token are trying to make it easier for crypto traders to buy, sell and trade non-fungible tokens (NFTs). But what is Muse? Let’s take a look and see what we can find out.
One of the biggest, not to mention most controversial, developments in cryptocurrency over the last year or so has been the NFTs. Although they have been around for a while, these collectible rights to pieces of digital artwork went stratospheric in the second half of 2021.
While the market has cooled down somewhat over the course of 2022 – with the NFT and metaverse sectors actually underperforming what is a general crypto bear market – the fact remains that they are, at least for the time being, a crucial factor in the crypto discussion.
Whether or not NFTs are a bubble that will inevitably burst is another matter for another time, but they are still here right now. The Muse crypto, which is operated by the Muse DAO and is linked to the NFT20 platform, aims to do something with NFTs that should, potentially, make them more accessible.
A basic introduction to NFTs
Before we look in depth at the Muse cryptocurrency, it is probably best to undergo a quick refresher on what, precisely, NFTs are.
If something is fungible, it can easily be replaced by something identical. A £10 note is a good example of this – if you lend one to a friend, you won’t notice if you’re given a different £10 note back. In fact, you could probably be paid in other denominations, such as two £5 notes, five $2 coins or even via a bank transfer and it would not be a problem.
Non-fungible assets are the exact opposite. Imagine a ‘No. 1 Trainer’ Pokemon card – one of the rarest in the game’s existence, with just seven believed to be in circulation. It may look like a normal card if you are not an expert, but it has certain things that makes it different from all the others. If you lent THAT to a friend and got a different one back, you’d be understandably upset.
Non-fungible tokens take the rarity and collectability of trading cards and bring it to the blockchain. They allow digitised versions of collectibles to be created.
If you want to get hold of an NFT, you can either buy one straight from the collection it is part of, or you can obtain a de facto, second-hand one from an NFT marketplace. These marketplaces are often, but not always, linked to a metaverse – a virtual universe where people can create things, often in the form of NFTs.
The problem with buying NFTs
That said, there is one issue with getting hold of NFTs. That is, you will need to go to somewhere that specialises in non-fungible tokens. This might, potentially, provide an inconvenience for would-be investors. People who already trade in crypto may not want the hassle of joining up with an NFT marketplace, of whatever kind, and having to make sure their wallets are connected and all their details in order.
However, because one of the key differences between crypto and NFTs is that cryptocurrencies are fungible, then it is not possible to trade an NFT on a regular crypto exchange. This means that, at present, while the two worlds are connected via their basis on the blockchain, they are in practical terms entirely separate beings.
NFT20: Solving a problem?
There is a way around this and this is ultimately why the Muse cryptocurrency exists. MUSE is the native token of the NFT20 protocol. So, before we look into “what is Muse?”, we should examine what NFT20 does and how it works.
As the name suggests, NFT20 was founded in the year 2020. The idea, to put it incredibly simply, is to create a process where non-fungible tokens can be turned into fungible ones so they can be traded on an exchange and then back again. NFTs which have been subjected to fungiblisation via NFT20 can, at the time of writing, be bought, sold and traded on a decentralised exchang (DEX), although there are no plans as yet for them to operate on a traditional, centralised exchange.
How this system works is like this. The NFT20 system has a series of pools. People can deposit their NFTs in the pools and, in return, get tokens. These tokens represent NFTs – in effect, they are representations of a representation – and, as a result, they can be taken away and swapped or sold, with the new holder getting a new NFT without, effectively, having to visit a traditional NFT marketplace. The reverse is also true, because people who want to buy NFTs can do so by getting one of the fungible NFT tokens. People can also sell their digital artwork directly on the platform, which also serves as a decentralised exchange itself.
It is worth pointing out at this stage that NFT20 was created by someone called Adam, who is described as a serial indie maker, and someone called Jules, who co-founded DAppBoard, a Google Analytics platform for smart contracts. They were backed by a Carlos Veloso, about whom nothing is mentioned, nor do any Google searches reveal any relevant information. That said, it is not too uncommon to have people behind crypto projects being either anonymous or pseudonymous. After all, Satoshi Nakamoto, the founder of Bitcoin, is almost certainly a pseudonym.
MUSE and Muse DAO explained
As a blockchain-based project, NFT20 has its very own native token, MUSE. This name reflects the name of the decentralised autonomous organisation (DAO) behind the system, Muse DAO. As the NFT20’s litepaper says: “The $MUSE token’s main utility is serving as the governance token.
“Muse stakers will also receive an equal portion of all the fees collected by the DEX. Whenever there is a NFT-to-NFT swap on NFT20, the fees will be sold for ETH to buy $MUSE and sent to stakers. The fee selling is rotated from pool to pool depending on liquidity and amount of fees held by the protocol. Only 10% of the fees owned by the protocol will be sold in a single transaction to prevent excessive selling before the market can react and rebalance price floors.”
One important thing to note about MUSE is that because it is ultimately based on the Ethereum blockchain, it is, to be precise, a token rather than a coin. You may come across references to the MUSE coin, but they are not, strictly speaking, accurate.
Facts and figures
In terms of stats, MUSE came onto the open market in late November 2020. It experienced its all-time high of $125.90 on 14 March 2021, and its lowest ever price was $0.1221, which it fell to on 24 December 2020.
As of around 16:52 BST (UTC +1) on 24 June 2022, the Muse price was around $15.11, and it had a market cap of around $7.7m, making it the 811th largest crypto by that metric according to CoinMarketCap.
The same site said that there were 508,554 MUSE in circulation, representing the total supply. However, there is something of a discrepancy here, because the Muse DAO white paper says that there was going to be a total supply of one million MUSE. We have asked CoinMarketCap to account for this discrepancy, but have not yet heard back. To make things more confusing, CoinGecko – which lists the token as Muse DAO – says that there are 969,482 MUSE in circulation out of a total supply of 969,572.
So, that is MUSE. Remember, though, that when it comes to cryptocurrency, it always pays to be cautious. You will need to do your own research, remember that prices can go down as well as up, and never invest more money than you can afford to lose.
Muse DAO is a decentralised autonomous organisation linked to the NFT20 platform, which is responsible for the management of the MUSE crypto token.
MUSE tokens can, theoretically, be available on all decentralised exchanges. In terms of more conventional, centralised exchanges, Coinbase has announced that it may start selling MUSE soon.