Explained: The Aavegotchi GHST Token

Playable assets that act as collateral on DeFi networks

GHST is the native governance token for Aavegotchi, a DeFi-focused play-to-earn ecosystem on the Polygon blockchain. Aavegotchis are basically game avatars that can be used as DeFi collateral to earn staking rewards.

Similar to CryptoKitties, the tokens have differentiating features such as body color and personality, and being a staked asset, its owner can liquidate the tokens at any time. Unfortunately, liquidating the NFT means the Aavegotchi is also gone forever.

The project was due to launch on January 4th, 2021, but was pushed to mid-March due to high transaction fees on the Ethereum blockchain. Now it runs on the Polygon blockchain. Pixelmatic Studios built their own bridge, to allow users to transfer NFTs between Ethereum and Polygon.

In the past 180 days, the value of GHST has fluctuated between $1.65 and $2.87. In the past few weeks, the token found a more stable valuation around $2,00.

Reasons for the positive market sentiment for GHST can be found in new developments introduced over the past several months. Last summer, the team launched new Aavegotchi ghosts through an event called The Haunt 2. In addition, they revealed a litepaper, describing a virtual world where NFT-owners will find all kinds of play-to-earn gameplay options. GHST is the native token for all of this. Additionally, the Aavegotchi virtual world saw the launch of new wearables collections this January, boosting interest in the gameplay and characters alike.

What is an Aavegotchi?

Aavegotchis are playable assets that also act as collateral on DeFi networks. To interact with one, DeFi users need to stake select tokens known as aTokens such as LINK (aLINK) and USDC (aUSDC) into the digital collectible. 

Apart from earning interest from staked tokens, holders of the platform’s native currency, GHST, also receive rewards. Furthermore, Aavegotchis are tradable on OpenSea and other NFT marketplaces meaning that those with valuable Aavegiotchis can realize the value.

Aavegotchi is banking on a system it calls rarity farming. Basically, the rarer the Avegotchi, the higher the price it should fetch on the market. Moreover, the platform shares part of its revenue with leading rarity farmers in a bid to gain user retention. 

Through integration with Aave and its aTokens, NFTs on the Aavegotchi platform create unique interest-bearing representations of funds supplied to the Aave protocol. Future drops, low transaction fees, and an expanding NFT store demonstrate that there is a healthy demand for GHST, and this is likely to grow as the platform expands.

In the past 30 days, Aavegotchi NFT sales generated more than $4 million in trading volume. Additionally, the platform attracted close to 4000 unique active wallets. This is a superb performance, ranking Aavegotchi as one of the top gaming dapps on Polygon.

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