What is a full-chain NFT? Why is it so important?

Recently everyone is talking about full-chain NFTs. But what is a full-chain NFT? If you don’t know anything yet, don’t worry — the concept has just started flooding into cryptoeconomic discussions over the past few weeks. William M. Peaster, the creator of “Metaversal”, expressed his views on the full-chain NFT.

The origin of the full chain

Much of the recent boom in full-chain chat stems from the rise of LayerZero Labs, a Canada-based team that created the interoperability protocol LayerZero. If you want to dig deeper, you can check out the protocol’s white paper. But simply put, LayerZero is a messaging layer designed to allow smart contracts to easily communicate between many or even any blockchain. 

On March 31, 2022, Beijing time, LayerZero Labs announced the completion of a $135 million Series A+ financing, co-led by a16z, FTX Ventures, and Sequoia Capital, with participation from Coinbase Ventures, PayPal Ventures, Tiger Global, and Uniswap Labs, with a valuation of $1 billion.

The past few years have seen an explosion in the number of sidechains, rollups, and layer 1 blockchains that support and scale multi-billion dollar applications. The future is multi-chain, but there are currently limitations. Bridging between chains can be an expensive, uncertain, and insecure process that requires users to pay gas on the origin and destination chains. The wrapped token needs to be exchanged for the native asset, adding an extra step (and transaction fee) to the user usage process. The liquidity pool of cross-chain decentralized financial applications is decentralized. Addressing these issues requires a protocol that enables interoperability and composability across chains, while unlocking new design domains and possibilities for cryptographic networks. LayerZero is a cross-chain communication protocol designed to alleviate current full-chain activity limitations. LayerZero is a trustless protocol that enables users to send tokens or any type of message across multiple on-chain applications in a single transaction. Unlike traditional bridges that require users to lock their assets, or use a single relayer or quickly finalize transactions between chains, LayerZero is versatile enough to run on any chain, covering the full spectrum Security and scalability assumptions. With LayerZero, you also only pay gas once on the source chain.

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The protocol was initially launched to support projects compatible with the Ethereum Virtual Machine (EVM), namely Ethereum, Arbitrum, Avalanche, BSC, Fantom, Optimism and Polygon. Going forward, the LayerZero team also plans to add support for non-EVM chains such as Cosmos Hub and Terra.

Compare full-chain, cross-chain and multi-chain

The LayerZero protocol functions similarly to the “layer zero” Inter-Blockchain Communication (IBC) protocol of the Cosmos ecosystem, at least in a general sense. Where LayerZero stands out is its use of Ultra Light Nodes (ULNs), which propose a new model for securely transferring messages between chains in a cost-effective manner. 

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Therefore, LayerZero’s full-chain message model is different from the cross-chain model, which requires the use of bridges to directly migrate or wrap assets to other chains. For example, if I bridge ETH through Ronin to use the Katana DEX, which is a cross-chain application, my ETH is transferred directly from Ethereum to Ronin. 

The full-chain model also contrasts with the multi-chain model, where independent communities with different values ​​pursue their own technology stacks. Consider how the Ethereum community is pursuing self-sufficiency through trustless transfers between Ethereum and Layer 2 (L2) scaling solutions based on its values ​​and foundations, while other alternative L1 ecosystems like Solana are taking their own unique extension method. 

The rise of full-chain NFTs

In recent months, we have seen a surge in interest in NFT applications across multiple blockchains. For example, the creators of Loot and other games have been thinking about how to track nft actions on-chain.

This cross-chain tracking has previously been an open issue, although more and more people are getting excited about the arrival of LayerZero precisely because of its potential to enable NFTs and related projects to go full-chain and exist in a broader way. 

Zooming in, you can trace the current craze around full-chain NFTs back to the recent launch of Stargate Finance, a bridging protocol and the first application to go live on LayerZero. With the activation of this first application, people and builders have started to look for other promising use cases, of which NFTs are certainly a big area of ​​interest. 

It is worth emphasizing that cross-chain lending, yield aggregation and trading are just the beginning. As a general-purpose messaging protocol, LayerZero can support a wide range of applications: games where NFTs exist on the Ethereum mainnet but scale transactions and activities on Rollup, the governance of DAOs deployed across multiple chains, and more. 

At the same time, the concept of full-chain NFT is not new, nor is it limited to LayerZero. For example, the Optimistic Oracle of the UMA project already has some full-chain-like features. Furthermore, I suspect that over time, with new advancements and further innovations, we will see many other different approaches to full-chain activity surfaced. 

LayerZero-based NFT collection

Stealth recently launched, Gh0stly Gh0sts is the first NFT collection based on LayerZero, and it has gained quite a bit of traction. Gh0stly Gh0sts is a set of ghost image pfp collections with a total supply of 7710 pieces. Mint was released at a free price on April 4th, and once topped the OpenSea daily trading list on April 5th, with a short floor price (OpenSea, Ethereum) It once exceeded 1 ETH at the time.

Gh0stly Gh0sts positions itself as the first full-chain NFT (omnichain NFT), which is different from some common custodial NFT cross-chain bridging schemes on the market (for example, the principle of Wormhole is to lock the NFT on the initial chain, and then issue it on the target chain An NFT copy), based on the cross-chain interoperability protocol LayerZero, Gh0stly Gh0sts implements multi-chain issuance, and can achieve atomic-level cross-chain transfers between multiple chains. Specifically, Gh0stly Gh0sts supports mint on seven different blockchains (Ethereum, Polygon, Arbitrum, Optimism, BSC, Avalanche, Fantom) at the same time at genesis, which means that 7710 ghosts will actually be distributed On seven different chains, so its real floor price requires the market conditions of all seven chains. Depending on where you were born, the background color of these ghost images will also vary.

The most critical gameplay is that when a ghost is born on a certain chain, it can directly travel between different chains through contracts, such as from Polygon to BSC, or from Avalanche to Ethereum. It must be emphasized that these ghosts traveling to other blockchains are not copies of the original NFT, but real NFTs that can be recognized by the target chain contract. The direct reflection of this is that when we remove a ghost from Avalanche After moving to Ethereum, the total number of ghosts on Avalanche will decrease by one, and Ethereum will increase by one. Therefore, the supply of ghosts on different chains is actually dynamic as well. On the whole, Gh0stly Gh0sts itself opens a new window for NFT gameplay.

I think full-chain NFTs can make a big pie for many projects and multiple chains at the same time. This technique may indeed prove to be the key catalyst, bringing nontrivial NFT activity to other chains.

However, I also think there may be a “king of the mountain” gain effect, and over time, full-chain NFTs may ultimately prove to be the most beneficial to Ethereum, i.e. they can consolidate and extend the widespread influence that Ethereum already has. It plays a huge role in making it a step further, while also advancing the influence of other parallel chains. 

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/what-is-a-full-chain-nft-why-is-it-so-important/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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