Dutch Auction

Definition:

An auction that starts high and gradually gets lower until the market determines a “fair” price. For example, an NFT piece may list for 5 ETH and every 5 minutes reduce by 0.5 ETH. There may be no buyers at 5, none at 4.5 etc until it hits 2.5 ETH at which point buyers come in. In a fungible token drop or NFT drop with multiple pieces, this can result in some buyers who buy early paying a higher price than others that buy later. Of course, those who wait too long may miss out if the drop sells out.

Degen Chat

Degen 1: “World of Women’s new NFTs are dropping in a Dutch Auction starting at 3 ETH. I think I’ll wait until the price goes down to 1 ETH.”

Degen 2: “Are you crazy? Those will sell out for sure at 3 ETH. I’m not waiting.”

« Dictionary Menu