NFTs on the ICP
The development of non-fungible tokens (NFTs) precipitated an expansion of blockchain utilities. The ability to attach metadata to a token allows unique information to be carried and thereby determine how each token can be used. This way, NFTs are a powerful tool for creating smart contracts between tokens and their owners.
Various applications of NFTs have been tested by many developers – of games, fashion accessories, virtual land and real estate and both physical and digital art. One of the most popular use cases has been to generate collections of 10,000 or so personal profile pictures (PFPs) which are like avatars with benefits. Whilst some very special tokens in these PFPs collections have been sold for enormously high prices, and therefore gain the most attention from the media, some critics say that PFPs have no real-world merit.
One view is that PFPs are just toy examples of what NFTs are to become as the digital economy and associated metaverses develop. But, just as Bitcoin was intended as a toy example of a blockchain, experimentation with technology is one of the core drivers in innovation. Therefore, no matter what the future of NFTs, OutRank’s research is helping obtain a much better understanding of their potential.
ICP is a blockchain that has understood and has built-in multiple features to strengthen the possibilities of this technology. More broadly, NFTs on ICP can benefit from:
Speed and scalability: ICP transactions are processed near-instantly and at a fraction of the cost of Ethereum gas fees. This makes it more affordable and more efficient to mint and trade NFTs on ICP
Decentralization: ICP is a fully decentralized blockchain, with no central authority. This gives users greater control over their NFTs and reduces the risk of censorship
Green credentials: ICP is a much more energy-efficient blockchain than Ethereum. This makes it a more sustainable choice for NFT creators and buyers.
In addition to these general advantages, ICP NFTs also have a number of specific technical features that make them unique, such as:
Dynamic NFTs: ICP NFTs can be programmed to change over time, such as NFTs that represent the progress of a character in a video game or the ownership of a real-world asset. This is not possible with NFTs on other blockchains
Nested NFTs: ICP NFTs can contain other NFTs, which can be used to create complex and interactive NFT applications. For example, you could create an NFT that represents a virtual world, which could then contain other NFTs that represent objects and characters in that world
NFT-to-NFT communication: ICP NFTs can communicate with each other and with smart contracts. This allows you to create NFTs that can interact with each other and with the world around them. For example, you could create two NFTs that represent two different characters in a video game, and then use code in the NFTs to allow the characters to compete against each other
On-chain storage: ICP NFT imagery is stored on the ICP blockchain itself, as opposed to a third party. This makes NFTs more accessible, resistant to censorship, and easier to create and trade without relying on a third-party platform.
NFTs can be accessed and traded on the ICP via several popular NFT marketplaces:
Entrepot: The first and largest NFT marketplace on ICP, with a wide range of NFTs available, including digital art, collectibles, in-game items, and domain names
Yumi: A fully decentralized NFT marketplace with a user-friendly interface and a focus on community engagement
ICPunks: A marketplace dedicated to the ICPunks NFT collection, one of the most popular NFT collections on the ICP.
As the technology develops further we can expect to see many more use cases appear. So it is very important to document each approach carefully, and disseminate this knowledge widely. This way, NFT applications will be able to inter-operate quickly and efficiently, thus further propelling growth in the NFT ecosystem. The research that the ICP is pioneering, supported by the DFINITY foundation, intends to fulfill this aim.
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