Many people are attracted to the crypto industry due to the continuous realization of new uses of blockchain technology. Since the inception of Bitcoin, we have seen multiple trends play out — P2P scalable digital currencies, privacy coins, decentralized funding (ICOs), decentralized finance (DeFi) and over the past few months, there has been a resounding interest in Non-Fungible Tokens (NFTs). Whereas Bitcoin, Ethereum and ERC-20 tokens are equally interchangeable (fungible), NFTs have specific attributes that make them unique assets on the blockchain. Combined with blockchain contracts, NFTs offer a solution for recording immutable, easily transferable, and transparent ownership of digital assets.
The possibility of creating NFTs has arguably been available since 2012 in the form of Bitcoin’s colored coins. However, a more familiar variation is Ethereum’s ERC-721 tokens (e.g. the recently popularised Cryptopunks that were created on the Ethereum blockchain in 2017). Several catalysts are driving the rapid and recent uptake in NFTs:
- Improved user adoption — browser extensions (e.g. Metamask) have simplified the process of interacting with the blockchain.
- Marketplaces — there are now a variety of options available for trading and selling NFTs such as Opensea and Rarible.
- Timing — the convergence of digital art and blockchain technology offers artists and content creators a unique opportunity to directly monetize their work to a global decentralized market.
- Value Distribution — early adopters of crypto who have made financial gains are now looking for ways to re-invest into the ecosystem and support its continuous adoption.
The capability of recording unique assets on the blockchain unlocks the potential for the development of many new projects. Trends have focussed on the following categories, all of which have seen parabolic growth in traded volume over the last year:
- Digital Art — Beeple (Mike Winklemann) recently grabbed headlines after selling one of his pieces dubbed ‘The first 5,000 days’ for $69 million through Christie’s.
- Collectibles — from 8-bit Cryptopunks to NBA Topshot moments, digital collectibles in all forms have been gaining traction.
- Digital Land — projects such as Decentraland, Sandbox, and Axie Infinity are unlocking the possibility of building metaverses on the blockchain that can integrate virtual conferences, games, art galleries, VIP events etc.
- Gaming — games on the blockchain can utilize NFTs to represent items, skins, weapons etc. that can be traded on an open marketplace or potentially imported into other blockchain-based games.
- Music — musicians are beginning to realize that they can directly monetize their music without the need for an intermediary, an example of this was Kings of Leon’s recent NFT sale of their latest album.
Numerous other projects are beginning to recognize the value of NFTs and are expected to play a major role in driving crypto adoption, by utilizing domain names, insurance policies, property deeds, event tickets, carbon credits, and physical merchandise connected to digital wearables.
Limitations of other Platforms
Whilst it is true that NFT adoption will continue to see tremendous growth, there are limitations facing creators, collectors, and investors.
The cost of minting an NFT on the Ethereum blockchain can range from anywhere between $40 — $100. When combined with marketplace fees, the minimum listing price is expected to be $100+, pricing out many potential market participants. It is important to note that fees are dependent on the blockchain being utilized, network usage (e.g. Ethereum gas fees), and the NFT marketplace fee structure.
The process of creating an NFT can also be complicated. Marketplace solutions building on top of blockchains have responded to this concern by simplifying the minting process for users on the front end, while taking care of the complexities on the back end. However, using these marketplaces means you are limited to the type of NFTs supported and configurations made available for you.
NFTs on Nexus
NFTs on Nexus are identified as ‘Assets’. Assets can be easily created through the Nexus desktop wallet or with the Command Line Interface. The Nexus wallet provides a straightforward and intuitive interface for users to create, update, and transfer Assets.
In terms of costs, the fee charged for creating Assets on Nexus is currently 1 NXS, which is vastly more cost-efficient than other existing solutions such as Ethereum. With Nexus, NFTs creators & sellers also do not have to set a gas price or limit, they simply pay the known cost of the contract execution, eliminating the risk of paying fees for a failed contract due to lack of funds.
Projects building on a Nexus hybrid network (utilizing the upcoming release of Nexus Hybrid mode) do not incur Asset creation costs, but rather are subject to Hybrid Mode fees.
Once an Asset is created on Nexus, it can be easily tokenized, allowing for shared ownership of the Asset, and the automatic distribution of revenue to the owners (token holders). Tokenizing Assets on Nexus is easily actioned through the Command Line Interface.
Nexus’ ‘Signature Chain’ technology removes the burden of key management, so that third-party plugins such as MetaMask are no longer necessary. Users can simply log in to their Nexus wallet with the familiarity of a username, password, & PIN, providing access to all accounts, tokens, and assets.
As part of the Nexus roadmap, a P2P marketplace module is set for release in 2021 that will allow users to trade Assets using NXS or other tokens hosted on Nexus with 0 transfer fees (0.01 NXS for more than 1 transfer every 10 seconds, to protect against spam attacks).
Also under development is a decentralized file storage solution to enable people to distribute the storage of their files (e.g. music, images and videos). It will serve as an alternative to centralized clouds owned by companies such as Apple, Amazon and Microsoft. The benefits of the Nexus file system will include privacy and censorship resistance, allowing groups of people to form private file system networks. Essentially, anyone with extra hard drive space will be able to monetize it.
Below are three projects that have developed DApps on Nexus, taking advantage of the intuitive and cost-efficient approach to implementing Assets.
- Biodiversity & Ecosystem Futures (BEF) is a UK Social Enterprise that aims to transform how biodiversity and ecosystems are protected. They have built a blockchain-based registry using a Hybrid Network that provides greater transparency and governance of environmental assets (e.g. carbon credits).
- Free & Equal is focusing on bringing the voting process to the Blockchain to promote transparency in the electoral process. They created an MVP utilizing the Bubble plugin to the Nexus blockchain. Users are able to vote on a specific poll by creating ‘votes’ in the form of Assets that are transferred to the poll owner’s SigChain (Nexus account) to be tallied for a final result.
- Witness'd has recently released a beta version of their marketplace for consumer generated videos that integrates with Nexus. NXS is rewarded to users of the social network when they upload videos, and an NFT on Nexus is created when a video is sold. It’s an adaptive PWA, therefore if you view on mobile you’ll see the social network, and on a tablet or laptop you’ll see the B2B pages.
Nexus community members have also been experimenting with creating, transferring, and tokenizing Assets on the Nexus blockchain:
- @A_Houghton37 shared his experience on Twitter after creating and tokenizing an asset on Nexus directly through the desktop wallet.
- @Arwyn created a Haiku (poem) and tokenized it, creating 10 tokens to represent the total ownership of the Haiku. He ran a great initiative on Slack where he gave community members clues to locate the Haiku asset, with the first 5 receiving one of the tokens as a reward. He then further experimented by sending NXS to the asset address, which resulted in automatic distribution to the token holders!
The ability of community members, without developer skills, to experiment with NFTs speaks volumes to the simplicity of interacting with Nexus.
Combined with a very simple asset creation process and negligible costs, an enjoyable end-to-end experience is now available to creators as they begin to explore the potential of this new and exciting P2P technology that replaces the requirement for third parties. Discussions of Marketplaces, Virtual Art Galleries, and Music Platforms are taking place. We welcome anyone who would like to find out more about Nexus NFTs to join our NFTs on Nexus telegram group.
To learn how to create Assets, please read the following guide.
To learn how to Tokenize Assets, please read the following guide.
To learn about the technology behind assets, please read about registerswhich are the third layer of the Nexus seven-layered software stack.
Nexus.io (NXS) is building a new internet driven by a blockchain-based operating system (LX-OS) and routing protocol (Nexus Protocol), creating distributed satellite constellations and ground based content delivery and edge computing. Underpinning the foundation is the Nexus TAO Framework, a seven layer software stack that enables the simplified implementation of smart contracts, Decentralized Applications (DApps), tokens, and Non-Fungible Tokens (NFT’s, i.e. Assets) through a set of extensible Application Programming Interfaces (APIs).
Contracts: Nexus supplies a 64 bit register-based virtual machine as the heart of its smart contract engine. A suite of APIs gives developers access to numerous ready-made contract functionalities. This relieves DApp developers from the burden of learning a smart contract language.
Tokens & Assets (NFT’s): Basic token creation is simple for even non-technical individuals with the Nexus desktop wallet. Arbitrary data can be stored on the Nexus blockchain in the form of assets. Once established, assets can be transferred to other accounts optionally with specified contract conditions (i.e. exchanging NXS / tokens).
Ease of Use: Nexus’ SigChains addresses a primary blockchain limitation — private key management. Users can login to their Nexus wallet with a username, password, & PIN, providing access to all accounts, tokens, and assets. This eliminates the need to backup wallet.dat files and manage private keys.
Database: Unlike most other blockchains that rely on Google’s LevelDB or Oracle’s BerkeleyDB for blockchain storage, Nexus has developed the Lower Level Database (LLD) that outperforms most storage engines by orders of magnitude and remains constant time, meaning it doesn’t slow down as you add more data to it.
Security: The Nexus security model uses many layers of redundancy to provide security to the system. The primary methods include using uniquely generated private keys for every transaction (attack window reduction), and the secondary use of Quantum Resistant (QR) cryptography such as FALCON and SABER.