Before we release the Asur NFTs in the market, here is a quick brief about the auction mechanism we plan to employ in our marketplace. Asur NFTs’ sale will be based on Asur-defined Auction Mechanism.
Auction Mechanism
Most auction platforms present today offer minimal privileges to both sellers and bidders. On many popular auction platforms, users are incentivized to bid the maximum they are willing to pay. They are not bound to the total amount but to the previous highest bid plus the increment. Such auction mechanisms are designed to limit bidders from placing higher bids and reduce the takes for sellers.
Asur has deployed its own Auction Mechanism to solve this problem, providing surplus opportunities for both the sellers and the bidders.
We have explained the difference between the Conventional and Asur auction model with an example for which we have defined some Key:Value pairs to be used later.
Note: These numbers are fictitious and are used to better explain the concept. Please don’t consider them as actual values.
Conventional Auction Model
In a conventional auction model, you can only bid according to the fixed increment on the previous bid set by the auctioneer. Let’s understand this with an example.
Using the numbers from the above table, the next valid bid = $550, no more or less than that.
In case, you wish to bid $700, you cannot, due to bid amounts limited by fixed increments. By default, the only option is to bid $550 (i.e., current_Highest_Bid + bid_Increment). If someone comes along and bids $605 ($550 + 10% of $550), your next bid needs to be ~$666 ($605 + 10% of $605), and the process continues until you bid the maximum or bow out.
Asur Auction Model
Contrary to the Conventional auction model, the Asur auction model removes the limitation on your bid amount. Furthermore, if you are the winner and your bid amount exceeds the highest_Binding_Bid, we will return the difference to you, i.e, your bid — highest_Binding_Bid. This mechanism is profitable for bidder and auctioneer both. We have simplified it for you with an example:
Base bid: $500
Incremental value: ≥ 10% of the previous bid
Now, you can bid as much as you wish to, which means that you won’t have to outbid people repeatedly. But if you win, only the highest_binding_bid (current_Highest_ Bid + bid_Increment) will be taken from you, and we will return the rest of the funds. For example,
- You decide to bid $650. However, you are only obligated to pay $550 (i.e., current_Highest_Bid + bid_Increment) if you win the auction. In this case, you are the current highest bidder and $550 is the highest_binding_bid.
- And $650 will be the base bid according to which the next bid will be placed, i.e., next bid = $650 + 10% of $650.
It’s like asking the platform to automatically bid for you up to a given amount, after which you’ll need to decide to raise your maximum bid or bow out. Any amount over the highest_Binding_Bid will be refunded when you successfully get your Asur NFT.
Under our auction mechanism, we will take a 5–9% cut of the winning bid as the transaction/platform fee. And you will receive the remaining amount after the auction is completed, directly from the smart contract.
Overall working:
The auctioneer will set the following three values to resell an Asur NFT.
- Duration of the auction. (Available choices- 24/48/72 hrs.)
- Minimum/Opening bid. (For example, $500)
- % Increment in the next bid. (Customisable in the range: 5–12%)
Please note that all increments are made on the previous bid and the numbers used indicate minimum valid bid. For example,
- If the first bid = $500, then second bid = $550 ($500 + 10% of $500), third bid = $605 ($550 + 10% of $550) and so on.
- If the bid is a fractional number, please round it to the next whole number. For example, continuing the above scenario, the 4th bid = $665.5 ($605 + 10% of $605). However, the participant will have to bid $666 ($665.5 rounded off to the next whole number) for it to be considered valid.
Under the above conditions, we can see the following scenarios-
- There are no valid bids in the specified duration. As a result, the auctioneer will close/cancel the auction.
- There is at least one valid bid (bid value ≥ opening bid) within the defined auction time. In this case, the auction cannot be canceled midway and would run for the specified duration. So,
- If the first bid value = opening bid (i.e. $500), second bid value ≥ $550 ($500 + 10% of $500), and so on. OR If the first bid value = $520 (> opening bid = $500), second bid value ≥ $572 ($520 + 10% of $520), and so on.
- If the first bid value = $550 ($500 + 10% of $500), then second bid value ≥ $605 ($ 550 + 10% of $550), third bid value ≥ $666 ($605 + 10% of $605 = $665.5 and hence rounded off to the next whole number)
- The first bid value is ≥ $500 (opening bid). Any further bids with increment X% where, X% increment > set % increment (here, 10%). For example, an increment of 12%.
We firmly believe in ensuring that you, as our customer, get the most beneficial deal and a seamless experience. And the Asur auction model is one of its few instances. Stay tuned for more from Asur!
Meanwhile, you can pop in our Discord and say hi!
