Several basic NFT protocols you should know

The main indicators reflecting the NFT market conditions are mostly concentrated on external data, which also makes the market focus more on the product side with high transaction volume, large number of users, and high auction prices, so as to easily achieve “traffic value increase”. In fact, this is only a corner of NFT. In addition to Dapps seen by top users such as trading platforms, games, art, collectibles, and virtual worlds, NFT also includes the underlying public chain infrastructure and intermediate network protocols, which they jointly build The NFT world. This article will have a more comprehensive understanding of the NFT track from the “middle and high-level” latitude.

Fewer scenes, more users, NFT booms

NFT will thrive on the DeFi boom in 2020, and gradually integrate with the new financial and entertainment markets. More asset forms and application scenarios have emerged, and the spillover effect is obvious. However, after analysis, more projects still remain at the level of hot pursuit, that is, there is no obvious innovation camp formed, which is largely related to the poor combination of NFT. The popularity of NFT this year is more derived from the violent prices of well-known IPs and artworks, which account for a large proportion of the market value. The huge wealth effect entails wave after wave of traffic entering, which has formed the NFT flood this year. .

The most direct thing is that the NFT is crowded with people and the transaction mood is positive, which gradually attracts a large wave of outside users to participate. According to data from Debank, the number of 24-hour users of the trading platform Opensea has 37,335, which is higher than that of the popular Uniswap V2 and much higher than the DEX products in the DeFi sector.

Several basic NFT protocols you should know

Several basic NFT protocols you should know

(Data source: Debank)

On the other hand, NFT has got rid of the haze of the previous quarter, and the overall data has begun to show an upward trend. The data chart from NFTGO shows that in the past week, the market value of NFT has risen significantly, from 610 million US dollars to 770 million US dollars. Simultaneously, The number of NFT holders rose from 240,000 to 360,000, forming a momentum of two-way progress.

Several basic NFT protocols you should know

Several basic NFT protocols you should know

From the perspective of DappRadar’s popular collections, most of the current popular NFT applications are still developed on Ethereum, and they also occupy a large number of popular collections. In the top 20 rankings, only Aavegotchi, a product developed based on Polygon, appears. It is true that the performance of the public chain is limited, but this cannot stop the leading edge of Ethereum in the NFT field.

Several basic NFT protocols you should know

(Image source: DappRaders)

This trend is also evident in the statistics of public chain browsers. Etherscan shows that there are 14,320 ERC-721 token contracts, BscScan shows that there are 4,675 ERC-721 token contracts, and Hecoinfo shows that there are 644 HRC-721 token contracts. It can be seen that even if the latter two are added, there are still fewer In Ethereum.

Several basic NFT protocols you should know

(Data source: Etherscan)

So, in such a market environment, which track is more favored by users and investors? The current market preferences have become more and more biased towards the meta-universe circuit. With the continuous improvement of market support and vocalization rates, especially the rise of Axie Infinity, the meta-universe game, it is greatly introducing traffic to the meta-universe, attracting more people to participate in this virtual and prosperous parallel world.

Secondly, artworks and large-scale IPs are still the mainstream. They are not as groundless as Meta Universe. They have basically undergone several years of precipitation and development. Especially products with many large-scale trading experiences occupy the market. The important status, such as CryptoPunk, NBA Top Shot, etc., is more prominent.

Several basic NFT protocols you should know

Cross-chain + Lay2 NFT intermediary protocols are becoming more abundant

Regardless of NFT or FT, its essence is the technical protocol standard with blockchain as the bottom layer in the process of asset digitization, and the intermediate network protocol is the basis for the emergence of applications. According to the more mainstream classification, the NFT protocol includes:

  • ERC721-The metadata structure of NFT tokens on Ethereum. The first standard representing NFT assets, which provides a mapping from a unique identifier representing a single asset to an address, was created by Dapper labs Dieter Shirley and brought to the market by CryptoKitties.
  • ERC1155-The Enjin team created ERC1155, which maps the number of assets and a certificate to an address, which means that multiple types of NFTs are managed in a single smart contract, which is a multi-edition limit.
  • ERC998 —— a combinable NFT, using this underlying protocol standard to generate tokens can realize a transfer of all different types of tokens.
  • ERC998 —— Nestable NFT, that is, the binding relationship of multiple NFTs.
  • ERC994-an extension of the ERC721 standard, which can be used to register land and physical property rights on Ethereum.
  • ERC420-PepeDapp proposed for the digital transaction card standard.
  • ERC809-By creating an API, it is allowed to rent any “competitor” NFT. The standard can also be used by general-purpose applications on the Ethereum network to allow owners to rent access to their NFT.
  • EIP2981-NFT royalties.
  • ERC1523-Insurance Policy NFT.
  • EIP1948-NFT with changeable information.
  • ERC875 —— Transfer NFT in batches.
  • IRC-721 —— A unified NFT standard based on the IOST public chain.

Currently, the popular NFT standard protocols on the market include ERC-721, ERC1155, etc. They not only regulate how to generate a single NFT, but also regulate how to produce NFTs in batches, which allows developers to easily generate a batch of similar NFT assets. As the forms of NFT assets become more and more diverse, in order to adapt to specific business needs, many new NFT protocols have been improved in specific directions based on popular NFT protocols. At the same time, many new NFT protocols have emerged to provide liquidity and adapt to market development. Innovative NFT, this aspect can be roughly divided into: decentralized cross-chain protocol standard, derivative type protocol and Lay2 layer NFT protocol. It is easy to understand. Let’s give a few examples.

Cross-chain basic protocol DNFT

DNFT is Polkadot’s NFT cross-chain protocol. It has recently received a million dollars in angel round financing, and it is supported by official grants such as Web3.0, Heco, BSC, and Filecoin. As Polkadot’s basic NFT facility, DNFT can provide various services such as NFT asset generation, transaction, data processing and governance. Based on the cross-chain agreement, more and more assets can be connected to different chain ecology such as Ethereum, BSC, Heco, etc., to build more liquidity channels for NFT. It is understood that the protocol has 5 main components, namely DataNFT, DataStorageWithTax, DataSwap, DAO governance, and AI-kit. Among them, AI-kit allows users to upload data and AI models, and NFT them, which is a brand new DNFT combines the machine learning model and the NFT of the blockchain to allow data and artificial intelligence models to circulate more widely. According to the development plan of the project party, it is still in the testing phase of the core module of the agreement and did not participate in this Kusama parachain slot auction.

Several basic NFT protocols you should know

RMRK: Polkadot NFT protocol with richer information complexity

RMRK’s goal is to build a more powerful and flexible NFT standard that is common in the Polkadot ecology. In terms of feature advantages, we can feel from a blog of RMRK founder Bruno. He said that RMRK is currently the most advanced NFT standard. If you experience However, you will feel that other NFT protocols are all products of the Stone Age.

The NFT standard of this project has no specific name. It is mainly realized by graffiti and marking in the extension field of the Kusama relay chain. It has a set of interpretation rules for graffiti. Tuya itself contains all the NFT state transition information and does not require the support of smart contracts. In response to NFT status query requirements, RMRK has developed a set of modules. Any parachain can integrate this set of modules to support RMRK NFT. It can scan the Kusama relay chain and store NFTs in the fastest and most concise way. Events and verify the legitimacy of the transaction. As for whether the project can be regarded as the most advanced NFT standard at present, it still needs real applications to run, and I also look forward to the arrival of such an NFT standard that can carry the information complexity and interactive form.

Liquidity Agreement Unicly

Unicly is a decentralized NFT protocol for combining, splitting and trading. The mainnet was released in April this year. According to online reports, Unicly’s full-day liquidity performance was probably on the order of millions of dollars at that time, and its performance was remarkable. The platform currency Unic of the Unicly agreement mainly refers to the economic mechanism of Sushi. 90% of it is produced in communities that rely on liquidity for mining, and only 10% is reserved for developers. Among them, Unic is mortgaged into xUnic to collect Unicswap fees, which are mortgaged with sushi. XSushi is logically the same, which is also known as the fork NFT of Sushiswap. NFT holders create their own uToken on the Unicly protocol. The protocol generally involves mortgage fragmentation of a set of NFTs, minting the corresponding number of ERC20 tokens, and then participating in liquidity mining, transactions, etc. Strictly speaking, unicly is regarded as a derivative agreement of NFT, and its liquidity mining will inject more traffic into the entire NFT ecosystem. Currently, Unicly Mining V3 version has been launched. The pledge and interest-earning service has been added, and projects such as Jenny Metaverse DAO, Hashmask, Aavegotchi, Beeple, Cryptopunks, Axies have been supported, and the cumulative total locked-up value (TVL) has reached 45 million US dollars.

NFT Fragmentation Protocol Niftex

The agreement was launched last year, and it can be regarded as a batch of fragmented NFTs in the circle. The fragmented operation process is essentially to host the ERC721 format NFT in a smart contract, and then split and issue ERC20 standard fragmented tokens based on this. . By splitting the NFT tokens into a custom number of ERC20 tokens, allowing them to be freely traded on the secondary market, thereby unlocking the liquidity of the NFT. This type of NFT liquidity agreement brings new price discovery after fragmentation, lowers the threshold for participation, improves the liquidity of NFT transactions, and can also decentralize community governance and become more decentralized. According to data from DappRadar, Niftex currently has more than 20 different types of fragments, including Cryptopunks, Axie Infinity, and Bored Ape Yacht Club, with a cumulative total lock-up value (TVL) of about US$4 million.

To summarize the above two categories, one is the development of cross-chain NFT protocol, the other is the development of NFT protocol for liquidity derivatives, and the other wave of very important NFT protocol standards is developed based on its own public chain and Lay2 layer. According to the latest According to news, ZKSwap will launch the Ethereum Layer 2 NFT protocol. A single user can create 65536 NFTs for free. The NFT on the ZKSwap platform will coexist with the AMM function, and support other Ethereum-based NFT platforms to access the Layer 2 protocol. With the rapid development of Lay2, related NFT agreements of this kind will become more and more abundant, and will continue to be the focus of users and capital.


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