# Protocol The protocol is the first element of the DAO NIFTSY, which is a formalisation of the on-chain capabilities of blockchains in a wide variety of formats. Initially, the Protocol is created on EVM-compliant blockchains (Ethereum, BSC and others), including L2 solutions such as Polygon, and later on on other decentralised and/or distributed systems. The protocol allows for the following NFT operations: * Issue; * Wrap/Unwrap; * Transfer (move); * Work with collateral, where there is a dynamic (replenishable) and a static (non-replenishable) part. ### **Protocol** Collateral-backed and price discovery cross-chain protocol to provide NFT with inner value and liquidity. ### **Inner value** The guaranteed inner value is a vault containing any crypto assets of Ethereum or BSC network for MVP. The capitalization of the inner value increases depending on the pledged assets, LP tokens and with each on-chain transaction. #### **Smart-contracts** NIFTSY protocol is a system of smart contracts on Ethereum and BSC networks, that provides guaranteed NFT inner value and liquidity. #### **On-chain royalties** NFT authors can receive royalties in native protocol tokens from sales in the secondary market. #### Key features of the Protocol: 1\. With the Protocol you can emulate NFTs of any order and level of complexity; 2\. you can also perform wrap (unwrap) operations on NFTs of any order. 3\. In addition, you can create new NFTs through a mint operation. 4\. Finally, you can design any convenient interest policy, whether it be royalties, bill payments (recurring payments), charity, or anything else. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://niftsy-protocol-niftsy-1.gitbook.io/niftsy/tech/technical-paper/protocol.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.