The rise of NFTs (non-fungible tokens) illustrates just how blockchain technology can improve more than the financial sector. NFTs provide developers and user with the ability to use blockchain assets to represent nearly anything. You could have an NFT that represents ownership of a car, a password to enter a community governance system, art, or in-game assets. The flexibility of NFTs makes them ideal for all of these tasks.
Part of the flexibility enjoyed by these tokens is based on the growing number of networks that support their creation and issuance. The NFT market is hot right now and developers are eager to provide users with more options. Here are the top NFT standards to watch in 2022.
Ethereum remains a dominate force across the DeFi sector. In particular, Ethereum NFTs are the most widely used at this time. Ethereum has two primary Ethereum NFT standards in use currently, ERC-721 and ERC-1155. Both of these standards enable developers to create unique and scarce digital collectibles.
The ERC-721 token standard was the first ERC-based NFT standard to go live. This standard differs from your typical ERC-20 token in that there are no monetary rules built into the token’s core programming. Specifically, ERC-721 does not mandate a standard for a digital asset’s metadata. This structure enables the addition of supplemental functions.
ERC-721 enables anyone to create an ERC-NFT. The protocol provides high interoperability within the market as ERC-NFTs can be traded on most DEXs (decentralized exchanges). The main purpose of ERC-721 was to provide an easy way for developers to integrate NFTS into their exchanges, wallets, or Dapps.
The ERC-1155 standard is the evolution of the NFT project within the Ethereum ecosystem. ERC-1155 tokens enjoy more programmability and other features that are unique to the NFT sector. For example, these tokens support the creation on new asset classes. They can also be set up to be sold in sets and collections.
The ERC-1155 NFT token standard has found a home within the Play to earn gaming sector. These NFTs enable developers to sell or trade entire classes of digital assets. For example, imagine purchasing all the weapons for a game in one trade. ERC-1155 tokens will make this and more possible in 2022.
Another DeFi project that continues to raise eye brows across the market is Avalanche. The Avalanche protocol leverages a multi-chain architecture to provide more security, scalability, and programmability. Specifcally, the Exchange Chain (X-Chain), Platform Chain (P-Chain), and Contract Chain (C-Chain) all work together to create a better user experience. Out of these three systems, X-chain was designed to support NFT creation and development.
One of the core component of Avalanche and part of the reason it continues to see a steady migration from Ethereum developers is the fact that the protocol is Ethereum Virtual Machine-compatible. Developers can launch their Ethereum-based Dapps and NFTs directly on Avalanche with minimal reprogramming required. Additionally, AvalancheGo’s API enables users to create and send NFTs easily.
Notably, every NFT belongs to a family within the Avalanche ecosystem. Avalanche adds some regulatory features to improve its appeal. The network leverages a subnet architecture. This structure enables developers to set NFT standards. These standards can be regional, license-based, and KYC/AML compliance mechanisms.
Binance Smart Chain
The Binance Smart Chain is one of the most popular NFT launch platforms on this list. The network is backed by the largest CEX in the market which gives it a lot of advantages in terms of technical and financial support. Binance NFTs utilize BEP protocols. BEP-based NFTs are faster and more cost-efficient when compared to Ethereum assets. Currently, Binance offers two NFT protocols based on Ethereum’s options, BEP-721 and BEP-1155.
Impressively, BSC users found a unique way to incorporate NFTs into the ecosystem. The primary use of NFTs on the Binance chain is as raffle tickets. Their individual nature makes them great for use as tickets. There are over 500,000 BEP-721 tokens in circulation today.
Notably, The Binance DeFi ecosystem recently got some of its first NFT auctions houses. BakerSwap and JuggerWORLD offer users an easy way to trade their NFT assets. Notably, JuggerWORLD was the first NFT marketplace to offer NFT creation features to BSC users. The platform’s interface makes it easy for anyone to create an NFT in minutes without any coding requirements.
The FLOW NFT blockchain represents one of the first times an entire network was built to support NFTs. Flow comes from the developers who introduced NFTs to the market via Cryptokitties. The success of their game helped this team to realize that a new type of blockchain was needed to support high-performance NFT collectibles and gaming.
The Flow blockchain is one of the top NFT networks in the market at this time. The protocol has seen over +$40M in NFT activity from just the NBA Top Shot platform. Flow’s development team sees the protocol as a vital NFT launch platform.
The network employs a multi-role architecture that helps improve transaction throughput and storage capabilities. Notably, Flow’s developers were keen to improve storage space without the use of sharding. As such, the network remains ACID-compliant.
Another major benefit of Flow is that it is written in the Cadence programming language. This designation provides the system with resource-oriented programming capabilities. It also improves development opportunities as Cadence is recognized as a safer and easier to use coding protocol.
Get Ahead of The NFT Curve
As NFTs continue to grab headlines and more people venture into the market, it’s wise to position your strategy to benefit from these changes. Now that you have some insight into the best NFT platforms to use, you’re ready to further your goals. The main thing to remember is to DYOR (do your own research) and understand that a lot of NFT’s value comes from their connection to a particular buyer. As such, these tokens can vary in value greatly between assets.