The way we interact with NFTs is evolving, and so are NFTs
You’ve probably heard of NFTs and the millionaire investments made by celebrities in digital assets. But did you know that NFTs don’t have to be static, but can also change over time? Meet the dynamic NFTs and prepare to be mindblown. In this article, we’ll guide you through the exciting world of non-fungible tokens and how the industry’s future is shifting with these evolved tokens. Let’s dive in!
Table of Contents
- What is a dynamic NFT, or dNFT?
- How do dynamic NFTs work?
- What are the most famous dynamic NFTs?
- Where can I buy a dynamic NFT?
- Tips before buying dNFTs
- Are dynamic NFTs more valuable than static NFTs?
- Dynamic NFTs: the future of the NFT space?
- How can I track my NFTs?
- Keep learning about NFTs with DappRadar
What is a dynamic NFT, or dNFT?
As the NFT space is constantly changing, it is often difficult to keep up with the most important trends. Dynamic NFTs, however, is not something you should miss knowing about.
Dynamic NFTs, as the name suggests, refers to a type of NFTs that change according to certain circumstances that trigger their smart contracts.
They are also often referred to as “Living NFTs”, and can have their characteristics change because of a special event or a real-world occurrence, and also see their value and demand shift.
What dynamic NFTs are not
For an NFT to be dynamic, it doesn’t have to be a moving picture, like a GIF or video. Sure, GIFs and videos can be NFTs, but these would also be static NFTs.
To be dynamic, an NFT needs to have its state altering from one point to another. This change takes place in the NFT’s metadata and can also be shown in how it looks.
How do dynamic NFTs work?
As you may know, NFTs are called non-fungible tokens because they are stored on a blockchain and can’t have their history erased. This, however, doesn’t mean that their metadata has to be static.
Technically speaking, dynamic NFTs are actually semi-fungible tokens – or ERC-1155 tokens, unlike traditional static ERC-721 NFTs.
They have, according to the official Ethereum website, the same features as the improved ERC-20 and ERC-721 token standards. In other words, the best of both worlds.
Once the dNFT receives the instruction in the smart contract and confirms it, it will display the predetermined change in the token’s metadata.
What are the most famous dynamic NFTs?
Dynamic NFTs can be applied in various ways across different Web3 areas. Get to know below some of the best examples of dNFTs that are already trending in sports, gaming, and art.
dNFTs in sports: The Association NFTs
One of the most practical ways to use dynamic NFTs is to tie them to real-world happenings, such as those that take place in sports. Sports NFTs are not new to the industry, and they have been extremely well received by the community since the NBA Top Shot collection in 2021.
Some collections of dynamic NFTs in the sports world are changing their tokens’ properties according to how players represented on NFTs do in matches.
In April 2022, the NBA launched a new collection of dynamic NFTs built on Ethereum called The Association.
“A week after launch, the Association generated a trading volume of over $13 million and was the 14th most traded collection. (…) These numbers are much higher when compared to NBA Top Shot at the same time after launch. For reference, it took NBA Top Shot four months to reach $1 million in sales volume and six months to surpass a volume of $13 million.”Boris Rebo at DappRadar Report
These dNFTs change in appearance (and in value) based on player and team on-court performance. While NBA’s previous collection took the NFT discussion to TV shows and dinner parties around the world, The Association still has more to conquer – and perhaps a lot more to add to the community.
dNFTs in gaming: Otherdeeds land NFTs
Another popular way to use NFTs is on Metaverse virtual worlds and blockchain games, such as the Otherside Metaverse.
This means that, once you own this land and play on it, you can change its characteristics in the smart contract itself.
The more you develop your in-game land, the more valuable your Otherdeed becomes – a beautiful example of dynamic NFT applied to gameplay.
Artistic dNFTs: JacksonNFT
Very popular but until then a bit stagnant, artistic NFTs are also starting to develop projects with this innovative technology. This is the case with the JacksonNFT collection.
“The JacksonNFT is unique in that every time someone mints a new one, they add a new brush stroke to all the other ones. By the time all 1,000 tokens are minted, it will represent a genuinely collaborative work of art.”Lawrence Rogers, the artist behind JacksonNFT
The collection sold out in minutes after its launch in July 2022 and could be one of the first to lead the dynamic and generative NFTs trend.
Where can I buy a dynamic NFT?
The process is exactly the same as purchasing a static NFT. You will be able to place a bid in an auction, for example, and pay a certain amount in cryptocurrencies. After the purchase is confirmed, you will be able to find the new NFT in your wallet.
You can use DappRadar NFT Explorer to check for any changes to your specific dNFT, as long as it is on the Ethereum blockchain.
Tips before buying a dynamic NFT
While NFT projects may all seem exciting, and you can’t wait to be a part of this movement, there are a few things you should do before purchasing any NFT. Here are some tips on what to do before buying a dynamic NFT:
- Research the project on your own using DappRadar NFT tools;
- Check out their official website, Twitter, and Discord;
- See how the NFTs may change over time and if it’s worth waiting for a change or not;
- Read our article Six Ways to Spot an NFT Scam.
Are dynamic NFTs more valuable than static NFTs?
That depends on inumerous factors. The value of an NFT changes according to the public interest in the NFT market, the project’s reputation, the artist and team behind it, and so on and so on.
With dynamic NFTs, however, there’s an extra factor added to it, and that is the ability to change itself – which can be good or bad, depending on how the change is perceived.
For instance, if a sports dNFT gets more valuable because the player is doing great this season, that’s great! But if the player represented on your dNFT doesn’t stand out, your asset may have its value stagnant.
On dynamic NFTs related to gaming, you can also see your token value increase if it becomes more appealing to the community.
Time alone will tell whether or not dynamic NFTs turn out to be more valuable than static NFTs.
Dynamic NFTs: the future of the NFT space?
The NFT space is fairly young and still has much ground to win. As you can read on the latest DappRadar’s Industry Reports, NFT dapps are some of the best-performing during this crypto winter of 2022.
As NFTs evolve and use cases emerge that are specific and unique from the speculation that has dominated the market in 2021, there is no question that NFTs will play a significant role in the next bull run.Sara Gherghellas, Blockchain Analyst at DappRadar
While some of Web3’s biggest brands are betting on collections of dynamic NFTs, we see a confident shift in industry trends – one that’s certainly worth following closely.
- You may also like to read: What are Blue-Chip NFT Collections & How to Find Them
How can I track my NFTs?
Now that you are aware of dynamic NFTs and how the space is evolving, you should also keep a close eye on your own investments.
You can use the DappRadar Portfolio Tracker to oversee and manage your NFT portfolio – how they gain or lose value over time and even their strength within their collection.
And if you’re still looking for a project to enter, the DappRadar NFT Collection Explorer will shed new light on your research. Watch the video below to visually explore the tool and all it offers.
And let’s not forget, for a quick and objective NFT market update, visit the DappRadar NFT Overview. There, you will find rankings to top NFT collections, the most expensive NFT sales, and Marketplaces.
That is, all you can ever need to analyze new and successful NFTs.
Keep learning about NFTs with DappRadar
While most NFT collections out there are still made up of static NFTs, this scenery is likely to change in the future.
Our team at DappRadar is constantly publishing valuable content on NFTs, Web3, and the Metaverse. If you want to be a part of this space, then you should definitely check out our blog to continue your learning path.
The above does not constitute investment advice. The information given here is purely for informational purposes only. Please exercise due diligence and do your own research.