As you already know, NFT can represent anything: a gif, a video, a jpeg. They have a contract that proves their authenticity and can be bought, sold or traded like any other item of value. One of their evolutions are the so-called dynamic NFT that bring greater interactivity and functionality. These NFT are also known as dNFT (Dynamic NFT), allowing for the creation of digital objects that can evolve over time and, as a result, ensure artists are able to deliver a more engaging experience for holders and fans.
Unlike traditional NFT, which represent static digital assets with fixed properties, dynamic NFT architecture is designed to respond to external conditions, such as user behavior, real-time market prices, a particular time of day, the weather or other environmental data. Static ones are immutable, dynamic ones are no exception.
When a dynamic NFT is created, the artist defines rules governing how the NFT can evolve or change over time. These parameters can be stored in the form of code, such as Solidity for the Ethereum network or Rust for Solana.

ERC721 (STATIC) AND ERC1155 (DYNAMIC)
The main difference between traditional and dynamic NFT is the token standard. Therefore, dynamic NFT work by storing data in a format that can be changed. While static NFTs are typically created using the ERC721 token standard, dynamic NFT use the ERC1155 standard. This type of standard token is usually referred to as "semi-fungible" because it can be changed if needed.
In addition, self-executing programs encoded within the NFT are used. These smart contracts automate certain functions, such as changing the appearance, animations or behavior of the NFT depending on specific circumstances. Furthermore, they allow for various interactions, such as allowing users to interact with the NFT in a virtual environment.
Basically, dynamic NFT use oracles for modification purposes. The oracles send external data to the smart contract, which causes the metadata of the NFT to change. Subsequently, the characteristics and appearance of this particular NFT, as well as its appearance, are updated.
Smart contracts also define how dynamic NFT can be bought, sold or traded, and how royalties should be distributed to their creators. They can then be used in decentralized applications (DApps) that support and use the dynamic features of NFT.

USE CASES
Dynamic NFT offer several advantages such as interactivity, programmability, versatility and creating new possibilities for artists and collectors.
Being programmable, creators can define rules on how the NFT should behave, providing a high level of automation and control and enabling new use cases and applications across various industries. For example, a dynamic NFT might represent a character or item in a game that evolves and gains new abilities based on the player's progress.
It is also possible to integrate them on social networks. Creators can also earn royalties on continued use or interaction with their NFT.
Similar to traditional NFT, dynamic ones can be used in art and music to create and represent unique works of art or rare recordings that change over time. For example, an NFT representing a digital painting might automatically change colors or patterns, or a music album NFT might update to include bonus or unreleased tracks as they become available. In a game, a digital weapon might gain new abilities or attributes as the player levels up. They can also be used for identity management, authenticity verification and to represent a user's profile on social media, with the ability to update and evolve based on his actions and interactions on the network.

EXAMPLES
An example of dynamic NFT are the RMRK on Kusama, which I had already talked about in the past. Basically it is possible to equip your NFT with weapons and other objects, then being able to interact in game. They are composable NFT.

In 2022, pseudonymous digital artist Pak's Merge project sold nearly $92 million worth of tokens "bulk" on the Nifty Gateway marketplace. The tokens are combined to form dynamic NFT collectibles which vary in part according to the number of tokens that have been merged. The artwork is generated on-chain using a custom script, similar to the popular NFT "Art Blocks".

Art Blocks is a platform for creating and selling generative artworks represented by non-fungible dynamic tokens. The works are algorithmically generated and can be customized by the owner, creating a one-of-a-kind work of art.
Those at Pearpop allow creators to mint NFT of their social media posts on the Solana blockchain. The dynamic nature of these NFT sees their rank increase as the post gains popularity, using metadata such as comments, shares and likes. A notable example of dynamic NFT are those of LaMelo Ball which follow the stats of the NBA player and change based on the updates of his points scored, rebounds and assists.

Another example is Mike Winkelman's "Crossroad," also known as the Beeple. The NFT was created before the 2020 US presidential election and was expected to change in appearance depending on the outcome. After Joe Biden became president, the image changed to depict former President Donald Trump reclining.
Async Art is another platform for creating and collecting programmable artwork that can change and evolve over time based on different inputs or external conditions. The artworks are represented by dynamic NFT, making them unique and valuable to collectors.
The Rarible NFT Market also allows for the creation and sale of dynamic NFT. An example of dynamic NFT on Rarible is the "Crypto Warrior" series, which allows collectors to upgrade their non-fungible tokens with additional features over time.
"Organic Growth Crystal Reef" (Ogcrystals) are dynamic NFT that have evolved over time. Within a three-month period set by the developer, the crystals grow in traits and transform their appearance based on transactions and time. Additionally, these crystals can be used in augmented reality (AR) and will soon have physical replicas displayed in art museums.

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