What Is A Dynamic NFT?
A Dynamic NFT or dNFT, is a type of NFT that can change some of its inherent properties based on external conditions. These changes are recorded and added to the metadata of the NFT.
Smart contracts, triggered by data from oracles and other on-chain and off-chain events, cause the changes to occur in Dynamic NFTs.
How It Works
Dynamic NFTs primarily use Ethereum’s ERC1155 token as of this writing. Similar token proposals are being developed on other blockchain platforms, including Solana.
In a Dynamic NFT, smart contracts provide instructions on how the dNFT’s metadata should be changed given a triggering event based on external data through an oracle or an on-chain event.
A base NFT is created first, after which smart contracts that govern updates, unlocking hidden traits or features, and image enhancements are put into place. These changes are conditional and only happen when a smart contract is triggered. Each smart contract can be triggered by events that can be on-chain or off-chain, as well as time, price, or location-based events.
Example: Dynamic Art
A piece of digital art in a dynamic NFT can change colors or hues and display specific time-bound features depending on the location in which it is displayed, temperature, season, time of year, or lunar position. For the
elements to change, smart contracts would have to be put in place to pull data from APIs or oracles relating to the events in question.
Another example could be a digital version of Andy Warhol’s Marilyn Diptych. A digital artist or programmer could create a calendar with important days associated with Marilyn Monroe’s life. On those days, specific colors or features commemorating the special events could be displayed.
There are several use cases that this innovation in NFTs will unlock. Below are a few examples, but several more are emerging.
Dynamic NFTs are living tokens that can change and evolve over time. The terminology in this space is evolving as well, traditional NFTs are increasingly being referred to as “static NFTs” because they remain the same.
Dynamic NFTs are an important innovation. They enable an extensive range of use cases and enhance the capabilities of the Web3 environment. Dynamic NFTs will be an essential tool that brings the natural and digital worlds closer.
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This article was first published here.