Currently, dynamic NFTs or dNFTs are popping up everywhere providing different and better attributes than the static NFTs. Before getting into dNFTs' benefits, I think it is important to understand what they are.

What are Dynamic NFTs (dNFTs)?

By now, we all heard of NFTs, Non-Fungible Tokens. These are assets that are permanently recorded on the blockchain. Dynamic NFTs are pushing these NFTs to whole new level. Dynamic NFTs also know as Living NFTs are a type of Non-Fungible Tokens that can modify and mutate their metadata on the blockchain when subjected to external events and/or time.

dNFTs have smart contracts that can change the properties of these NFTs when triggered by events such as other smart contracts, time, environmental change or other NFTs. This characteristics made them more adaptable to the environment than static NFTs, as a result made them more favorable for different projects.

How does dNFTs Work?

Within every dNFTs, there are smart contracts that provided instructions to change the metadata on the blockchain when exposed to external factors.  For example, some dNFTs has characteristics that change when the time of the day change, when their location change, when seasons change or even when the temperature fluctuates. The smart contracts are designed to react to changes that are specified when the dNFTs are created which will result in total or partial changes of the dNFTs' properties.

How Can We Use dNFTs?

The functionalities of dNFTs are still at their infancy. The gaming world is dabbling with them more often these days but there are now wide adoption just yet. But it is worth mentioning some areas where using dNFTs can result in substantial gain:

• Gaming: Some games are adopting dNFTs because they are providing great benefits for both player and the overall gaming platforms. Players' progresses will continuously be updated to their dNFTs. As a results, when players' characters improve so will the value of their dNFTs. 
• Education: Student certificates can be designed to be dNFTs. As students improve their educational status, it will be directly reflected on their dNFT certifications. 
• Identification: IDs can now be dNFTs. As personal information, location, marital status changes, it will trigger the smart contract which will then update the ID of that person.
• Asset Management: Assets such as houses or buildings will undergo many structural changes, design changes or maintenances throughout time and as a dNFT, their history will be updated accordingly.
• Art: Artists can create amazing dNFTs that can respond to different environmental factors such as time of the day, season, temperature and so on.

Conclusion

The potential of dNFTs has just been recognized, therefore, not a lot of projects have adopted them. But it is easy to see their benefits can be game changer to the NFT world and the whole blockchain technology. This innovation can also be a bridge that can connects the real world to the digital while providing great benefits to the users. 

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Disclaimer

I am not a financial advisor. The information found here are for educational purposes and cite my personal opinion and it should be considered as such.