A look at Dynamic Nfts, the future of digital collectibles
NFTs have taken the world by storm. These digital assets have attracted huge interest from investors, including A-list celebrities, even selling for millions of dollars in some cases. The use cases of NFTs have also developed significantly in the last couple of years.
They are no longer just an avenue for digital art; they have also been used for ticketing, charity, supply chain management, real estate and more. It is perhaps the fastest developing sector of blockchain technology. And the latest advancement in the digital asset space is dynamic NFTs.
Dynamic NFTs are a step up from the static and unchanging digital resources we have become familiar with. They offer a new world of possibilities, where NFTs are constantly changing based on external events and conditions.
In this article, we will quickly go through dynamic NFTs, how they differ from static NFTs and their possible use cases.
What are dynamic NFTs?
Each NFT has certain metadata associated with it. This data describes the characteristics of NFT. For example, the metadata of a Bored Ape Yacht Club artwork would include details such as the name/number of the piece, the color of the background, the attributes of Bored Ape’s outfit, etc.
In static NFTs, the metadata does not change. Therefore, the properties and appearance of the NFT remain the same. But with dynamic NFTs, metadata is programmed to update based on real-world events.
These NFTs have built-in smart contracts that receive data from oracles, and trigger changes in the token’s metadata. An oracle acts as a bridge between on-chain code and off-chain infrastructure, allowing blockchains to react to real-world events and interoperate with traditional systems.
The smart contract is coded with instructions that determine when and how the NFT’s metadata should be changed based on input from the oracle. This allows the attributes of the NFT to be changed while its unique identifiers remain stored permanently on the blockchain.
Examples of dynamic NFTS
One of the best examples of a dynamic NFT is the ‘Association’ collection from the NBA. Launched in April 2022, the collection features 75 dynamic NFTs, one for each player from the 16 different teams participating in the NBA Playoffs. As the playoffs progressed, the attributes and accessories of the NFTs would change, reflecting the player’s dunks, three-pointers, rebounds, blocks, and assists. The framework and background of these NFTs were also updated based on the team’s performance.
Other dynamic NFTs include LaMelo Ball’s Gold Evolve NFT and Beeple’s Crossroad NFT. Both of these NFTs changed their appearance based on real world events.
Beeple’s crossroads changed based on the outcome of the US presidential election, depicting Trump’s corpse rotting in a park after Biden won the contest. On the other hand, the LaMelo Ball NFT depicted the NBA player dribbling a ball that turned to gold as he won the rookie of the year award.
Possible use cases of dynamic NFTs
Dynamic NFTs can find use cases in multiple industries and sectors thanks to their permanent storage and editable attributes. Here’s a look at some of these use cases.
Property
Instead of a static NFT that only indicates ownership, a dynamic NFT can give a more comprehensive idea of the property and the changes that have been made over the years. It can provide updates on the property’s age, maintenance history, previous sales, etc.
Fantasy sports
Dynamic NFTs can also be used to create sports cards that update the player’s stats based on the player’s current performance. The cards can be connected to data from sports websites and changed as long as the player is active.
Gaming
Gaming NFTs are already quite popular. Whether it’s an in-game purchase or artwork based on an in-game character, a dynamic NFT can be updated as you level up. Popular gaming platforms are already introducing NFTs and it won’t be long before they switch to dynamic NFTs to give players a more customized ownership experience.
Passport
If all passports were dynamic NFTs, they could be stored on smartphones, and continue to be updated with data from public websites. This makes it more convenient at airports and even Visa applications.
Conclusion
Dynamic NFTs are a paradigm shift in the digital asset industry. Several projects are already working with this technology to launch innovative new NFT collections. However, until now we have only scratched the surface of dynamic NFTs. This new type of digital asset could unlock more doors in the future, bringing use cases we probably haven’t even thought of yet.
