Vision

Fungible exists for one reason: to make NFT trading fun again.

Perps and memecoins ate NFTs' lunch over 2023-2025. Floor prices on the biggest collections cratered 70-90%. The culture that made them worth owning — the chat, the price discovery, the speculation — moved to Solana tickers and perps on Hyperliquid.

We're flipping that by perpifying NFTs. Fungible turns blue-chip NFTs into shards you can trade like tokens, then layers perps on top so you can long or short JPEGs with leverage. The treasury accumulates forever, funded by a 5% tax on every $FUNGY trade.

$FUNGY token

$FUNGY is a standard ERC-20 with 100 million fixed supply, no inflation, no mint function. ERC20Votes-enabled for governance.

Every transfer carries a 5% tax which routes to the NFT Treasury. The tax is enforced at the contract level — there is no bypass, no off-chain agent, no permissionless keeper to drain it.

Exemptions apply only to protocol routes: liquidity pools, the treasury itself, staking contracts. These exist to avoid double-taxing routine protocol operations. All exemptions are publicly listed on-chain.

The 5% tax

Every $FUNGY buy and sell pays 5%. There is no split. No team cut, no marketing budget, no liquidity carve-out. All 5% goes to one place.

Phase 1 — Bootstrap: 100% of the tax routes into the NFT Treasury contract. ETH and USDC accumulate until the next handpicked target is acquired.

Phase 2 — Self-sustaining: Once Treasury has acquired enough NFTs and Spot + Perps fee revenue covers ongoing operations, the tax destination flips on-chain. The same 5% is used to market-buy and permanently burn $FUNGY, returning value directly to holders.

NFT Treasury

The Treasury is the heart of the protocol. It is a non-upgradeable on-chain contract that holds ETH and USDC accumulated from the $FUNGY tax. Its only job is to buy specific NFTs that the community has chosen.

Target selection

Targets are picked one at a time. Token holders propose a specific NFT, debate publicly on Snapshot, and vote. A ratified target lists exactly which NFT will be bought next: a specific token ID from a specific collection, along with a max price.

This is deliberately manual. We do not run a programmatic floor-sweeping algorithm. We pick the NFT, the community ratifies it, and the Treasury executes the buy. Every acquisition is publicly announced before, during, and after.

Invariants

Acquired NFTs are permanently custody-locked in the Treasury. There is no admin path, no migration route, no proxy. The only way an NFT ever leaves the Treasury is through shard redemption.

Sharding

Sharding (a.k.a. fractionalization) is the process of splitting ownership of a single NFT into many fungible tokens. Each token represents a tiny equity claim on the underlying NFT. Once enough shards are accumulated by one address, that address can redeem the original.

This is not a new concept. The pattern has been live on Ethereum since 2021 and has produced some of the most-traded NFT-backed tokens in history.

Prior art

• Fractional.art / Tessera — the first major fractionalization protocol. Pioneered the buyout-auction mechanic and was used to shard the famous Doge NFT into $DOG. tessera.co
• NFTX — vault-based fractionalization where many NFTs from one collection share a single ERC-20 (e.g. $PUNK, $MILADY). nftx.io
• Unicly — supported curator-vaults and uTokens (uPUNK, uJENNY). An early experiment with per-bundle ERC-20s backed by NFTs.
• SudoSwap / sudoAMM — not fractionalization per se, but demonstrated continuous bonding-curve pricing for NFTs.

Fungible takes the same fundamental mechanic (one NFT, many fungible tokens, redeemable via buyout) and applies it specifically to blue-chips already owned by the Treasury.

One NFT at a time

Each NFT in the Treasury is sharded individually and manually. There is no batch sharding, no programmatic trigger, no automated "acquire-and-shard" pipeline.

Symbol & supply

Each NFT becomes a new ERC-20 with a deterministic ticker. BAYC #3913 becomes BAYC3913; Pudgy Penguin #5656 becomes PUDGY5656. Total supply is fixed at 1,000,000 shards.

Spot exchange

Fungible Spot is a constant-product AMM, one pool per (shard, USDC) pair. Based on standard x·y=k mechanics.

0.5% flat fee on every fill, paid by the taker in USDC. All fees route to the Treasury during Phase 1, then flip to buy & burn in Phase 2.

Anyone can provide liquidity on any pool. LP shares are tracked per-pool and redeemable at any time.

Perps

Perpetual futures on every fractionalized NFT, USDC-margined and USDC-settled. Up to 20× initial leverage, maintenance margin at 5%. The mark price is a TWAP of the underlying shard's Spot price.

Each position is isolated. Collateral posted to one position cannot be touched by another. If a position liquidates, the loss is bounded by its own collateral.

0.04% taker fee on notional. Routes to the market's configured receiver — Treasury by default, or the holder-submitter via Shard Your NFT.

Futures vault

The Futures Vault is a USDC-denominated pool that acts as counterparty to Perps takers. Depositors mint vFUNGY share tokens on entry; redemption burns them at the current NAV/share.

NAV/share is checkpointed every block. Withdrawals settle at the next block's NAV. Instant withdrawal of up to 10% of the Vault is allowed via the buffer reserve.

10% performance fee on profits above the high-water mark. No management fee, no lockup. Performance fees route to the Treasury during Phase 1.

Fee flow

Fungible has two phases of fee handling. Bootstrap first, buyback later.

Phase 1 — Bootstrap: 100% of Spot and Perps fees route to the NFT Treasury. This compounds NFT acquisitions.

Phase 2 — Buy & Burn: Once Perps generates enough profit to sustain market-making independently, the protocol flips a switch: all fees route to $FUNGY buybacks, which are burned.

Shard Your NFT

Holders can submit an eligible blue-chip NFT to be perpified: the Treasury accepts custody, the NFT is sharded into 1,000,000 fungible tokens, a Spot market opens, and a perps market launches against it.

In exchange, the holder who submitted the NFT receives 100% of perps taker fees on that NFT's market, for the life of the protocol.

See the Shard Your NFT page for the full submission flow.

Governance

$FUNGY is the governance token. One token equals one vote, no delegation cap. Most parameters are hardcoded and immutable.

What's mutable

• Treasury targets and acquisition order.
• The Phase 1 → Phase 2 fee flip.
• Shard Your NFT whitelist additions.

What's not

• The 5% tax rate.
• Shard supply per NFT (1M) and the redemption mechanic.
• The 0.5% Spot fee and 0.04% Perps taker fee.

Risks

Fungible carries the cumulative risks of NFTs, AMMs, order books, perpetual futures, and on-chain governance. Read this section twice. If you don't understand any of these, do not use the protocol.

NFT floor risk

NFT collections are reflexive: prices can fall 80%+ in weeks. The Treasury's holdings are marked to floor.

Perps oracle risk

Mark price derives from a TWAP of Spot. Thin Spot liquidity makes the TWAP easier to manipulate.

Regulatory

Fractionalized NFTs and on-chain perps occupy ambiguous regulatory ground. Users are responsible for compliance in their own jurisdiction.

Roadmap

Security

Audits

Audit round 1 pending. Trail of Bits and Spearbit under negotiation. The contracts will not be deployed to mainnet until at least one professional audit is complete.

Bug bounty

Up to $500,000 on Immunefi for critical vulnerabilities. Tiered payouts down to $1,000 for low-severity issues.

Emergency mechanisms

• A 5-of-9 security multisig can pause Spot matching, Perps fills, and Vault deposits for up to 7 days per incident.
• Multisig cannot transfer Treasury NFTs, mint $FUNGY, or modify fees.