NFT has evolved rapidly, gaining popularity and traction from several multinationals, government, investors and celebrities. As a result, it is one of the most prominent innovations of the blockchain industry.
One of the recent innovations within the web 3 space is the dynamic NFT. Dynamic NFTs are an improvement of static NFTs. They are flexible NFTs that can change their attributes or appearance based on certain conditions. These changes are saved and added to the metadata of the NFT.
In Static NFTs, the metadata does not change, so the features and appearance of the NFT remain the same. But when it comes to dynamic NFTs, the metadata can change based on events from the real world. The NFT is programmed to be updated with the help of a smart contract. Smart contracts lay out guidelines on how the dynamic NFT’s metadata should be changed given a triggering event predicated on external data through an oracle. An oracle acts as a link between on-chain code and off-chain infrastructure, enabling blockchains to react to real-world events and interact with traditional systems.
The smart contract encoded with instructions decides when and how the NFT should change based on inputs from the oracle. For example, a piece of digital art in a dynamic NFT (dNFT) can switch to a different colour from the original and show time-bound features, season, time of the year, or lunar position, depending on the displayed location. For the elements to change, a smart contract would need to be emplaced to pull data from oracle depending on the event in question.
Use cases of dynamic NFTs
There are different use cases that this new NFT innovation can unlock.
Below are some of the use, with a lot more still emerging:
NFT collectibles can change or add certain traits to the way they look based on real-life events. An example of this was when NBA player LaMelo won the rookie of the year for the 2020-2021 NBA season. His in-game performance leveled up his set of NFTs and gave benefits to its holders. The NFT colour transformed to gold, and the Saturn held was replaced with the sun.
Instead of a traditional NFT stating just ownership, a dynamic NFT could give a full idea of the property and the changes that have occurred over the years. It could provide property details, like the maintenance history, property’s age, previous sales, etc.
NFT for fundraising is not a new idea in the NFT space, but the concept of dynamic NFT has made this idea more attractive. For example, Regenerative Resources Co (RRC), an ecosystem services company that collects funds to plant mangroves, released dynamic NFT of short films that initially consisted of a single frame but added more frames each time they were resold. The process goes on till the film is completed.
Dynamic NFTs can be used to create a sports cards that give updates on players’ statistics based on the player’s performance. The cards can be linked with data from sports websites and can keep changing as long as the player stays active.
NFT arts can change its various traits or evolve based on external conditions. Crystal Reef, for instance, are dynamic NFTs that evolved based on time transactions. In a 3-month time frame set by developers, crystals change their traits and how they look based on time and transaction.
There will be more ease at airports and during visa applications if passports were dynamic NFTs. In addition, the dNFT passports could be stored on mobile devices and can be updated with data from government websites.
Dynamic NFTs are not just innovation but a paradigm shift in the NFT industry. They establish an extensive range of use cases and improve the capacity of the web 3 spheres. With the success of this concept, the dynamic NFT might just usher in more innovations that will bring about new use cases that have never been thought of before.
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