Getting Ready for fxhash’s New Art Coin Economy

There are tons of new developments to explore onchain right now. This week, one of the most interesting of these developments is coming via the cryptoart scene by way of fxhash.

That's because on Wednesday, July 2nd, the generative art platform is officially launching its $FXH token and kicking off its new protocol.

But this won't just be a plain token drop. Instead, $FXH will be used to underpin fxhash's new art coins system.

And while traditional long-form gen art releases in crypto have centered around static, fixed edition collections, these art coins are going to facilitate fxhash's new "open-form" medium where releases will be dynamic, interactive, and potentially lucrative for both artists and collectors.

So what do you need to know here?

First up, now whenever artists launch a collection on fxhash, they have the option to launch a new, fungible ERC-20 art coin for it, or they can link it with an already existing art coin.

These coins have a 1M supply each and are released through a bonding curve on Base. With enough activity, an art coin graduates, at which point it's paired against $FXH and migrated to a liquidity pool owned by the artist and locked for two years.

It's also upon graduation that the underlying open-form gen art collection becomes mintable by collectors. This is where things get really interesting.

Why? Because art coins are the gateway through which collectors can co-create, evolve, and even earn in this new open-form paradigm. The main actions to know here include:

🪙 Minting, Burning, Rerolling

Collectors must spend the relevant art coin plus a small ETH fee to mint a new artwork. Each edition carries a unique hash. If you don’t like your output, you can burn the NFT and reroll immediately with the same art coins, paying only the ETH mint fee again. Also, supplied art coins are escrowed in a collection's smart contract, and burning frees any escrowed coins back to the collector.

🔒 Locking

Locking freezes an edition’s traits forever, converting it into a “seed.” Locked seeds can no longer be burned or rerolled, but they do unlock the ability to spawn "children" NFTs via evolutions. Locking also permanently locks any art coins that are escrowed inside an edition.

🎨 Evolving

Once you hold a locked seed, you can spend additional art coins and a small ETH fee to evolve it into a new child NFT. That child edition inherits the full array of its ancestor hashes, making a lineage of unique but related outputs.

The art coins you pay are escrowed until that child NFT is either burned or locked, and the ETH evolution fee is split between the artist, fxhash, and holders of each prior seed in the chain.

In effect, every evolution both pushes the artwork forward and rewards collectors who locked the strongest seeds.

So, to recap:

• Minting or evolving escrows art coins, temporarily reducing the circulating supply.
• Burning releases art coins back to a collector.
• Locking permanently removes art coins, shrinking the supply.

These mechanics mean that not only will fxhash's new open-form collections evolve artistically, but their associated art coin markets will evolve through activity.

With more editions locked, an art coin's supply will dwindle. But to interact with a collection you'll still need art coins, so the growing scarcity can bring buy pressure to the coins that remain.

In other words, here artists can earn from every mint, evolutions, secondary trading fees, and the potential price appreciation of their art coin(s). Conversely, collectors can earn from curating and locking choice seeds, while traders can just speculate on art coins as they please.

It's a pretty neat system honestly, and I look forward to tracking it and trying it in the weeks ahead.

I'm not a generative artist myself, so I plan to collect from the genesis drop that's coming via the $CIPHRD art coin to start experimenting with rerolling, evolving, etc. I've also got my eyes on the $PUNEVYR drop, as its early sample outputs look amazing and like they'll be a lot of fun to evolve.

If you're keen to explore here, too, get some ETH ready on Base ahead of Wednesday and then once the new protocol is live grab art coins from collections you want to participate in. In the meantime, you can try testing evolutions and see how they work!