> For the complete documentation index, see [llms.txt](https://docs.chonk.finance/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.chonk.finance/phase-1-chonk-nft-x-token-hybrid/what-is-a-nft-x-token-liquid-hybrid.md).

# What is a NFT x TOKEN Liquid Hybrid?

## What is a NFT x TOKEN Liquid Hybrid?

CHONK is a game changing DEFI innovation that merges NFTS and an ERC-20 token into one cohesive ecosystem.\
\
Our bidirectional NFT swap system seamlessly merges the NFT and token markets, creating a hyper deflationary NFT with unique game theory dynamics.\
\
Addressing the liquidity challenge in the NFT realm head-on, we've introduced a solution that distinguishes us in the DEFI world.\
\
At CHONK, we're not only advancing DeFi, we're shaping the future of NFTs.

{% hint style="success" %}

#### To those wondering, this is NOT an ERC-404 project. 

#### Instead, the best way to describe it is as a collateralized NFT that has a redeemable liquid value at any time by locking your NFT in the two-way escrow (swap) contract. With this mechanism, the floor price of the NFTS will correlate with the price of the token(s) as each NFT held by wallets has a "liquid value" attached to it.

#### Additionally, the NFT collection will become hyper-deflationary over time as users elect to lock up their NFTS and claim the corresponding tokens in return.

{% endhint %}

<figure><img src="/files/oEF6Brz5MFqG2hTTWKOM" alt=""><figcaption></figcaption></figure>

### Learn more about how Hybrid NFT//Tokens work in the following pages!