Dapper Labs, the creator of obsessive cats, has developed a public chain Flow tailored for NFT.
Original title: “An article to understand how Ethereum promotes the prosperity of NFT”
Written by: keluoge
Translation: Fenbushi Capital
In the three months at the end of 2017, Dieter Shirley and his team developed the Ethereum token standard ERC-721 in a small room on the corner of a start-up foundry in Vancouver, enabling digital art to “verify its scarcity.” The project called CryptoKitties went viral shortly after its launch, bringing Ethereum to the brink of collapse. The success of CryptoKitties helped the birth of the digital art industry, and the total value of the industry is expected to reach 315 million US dollars this year.
The biggest innovation of NFT is the introduction of scarcity into cryptocurrencies: every bitcoin is indistinguishable, but ERC-721 tokens are unique. Shirley and his team used technology to create a new art form.
They implanted something similar to a genetic code on each encrypted cat (that is, ERC-721) representing the cartoon “Derby” cat. Each encrypted cat has a unique “cat nature”, including their own parents and temperament.
“The team injects life into boring things, and these things are essentially just a financial token. They pay attention to it and give it a special temperament. It becomes so kind and cute that people have a passion for their cats. “Special Bell” said Franky Aguilar, an artist from Los Angeles who later worked at Dapper Labs behind CryptoKitties.
The owner can raise crypto cats to breed new cats. Rare crypto cats are worth thousands of dollars: for example, in 2018, a cat named “Totoro” sold for as much as 170,000 dollars.
An NFT idea
As people mint their own ERC-721 tokens (also known as NFTs, or non-fungible tokens), this craze has begun to sweep everywhere. As the market opened up, game developers integrated NFT-based digital objects, and digital artists began to create around NFT. Today, a few years later, the French gaming giant Ubisoft has built a game around NFT, the NBA has also stamped the ERC-721 seal on the online trading card, and outstanding artists sell their works for thousands of dollars.
Shirley looked at the world he helped build and said, “I feel very proud to make something that people can play on it. This kind of creativity is not on my own. I enjoy it.”
However, time has passed: Some people say that due to the high NFT gas fee and weak performance, the market is too large for Ethereum to carry, people are starting to look elsewhere. In the past two years, the Shirley team has developed into Dapper Labs, creating a Flow chain specifically built for NFT. Dapper Labs has come to praise and recently signed an agreement to create an NFT for Dr. Seuss and other roles on the Flow chain.
If Ethereum cannot solve its own problems, I believe NFT will discard it.
Market maker
Devin Finzer is the co-founder and chief executive of OpenSea based in New York. OpenSea is one of the largest NFT markets. When CryptoKitties became popular, Devin Finzer and co-founder and CTO Alex Atallah founded the company together, and it went to market in early 2018.
“This is just another way to trade CryptoKitties,” he told Decrypt. He added that because CryptoKitties has its own market, it was not particularly useful at first. However, they will still launch other NFT games in a situation where the customization market is not yet clear. “This is where OpenSea is useful: when there is no market for the game, people with these NFTs can still connect to their MetaMask and start trading immediately. ”
Finzer said that in the months after the launch of CryptoKitties, dozens of low-quality projects were imitated. They tried to take a ride on the crypto cat and profited from this speculative boom. In fact, the maturity of the NFT project does not take much time. As of February 2018, the market has attracted many legitimate projects, and these higher-quality projects will have “more development” accordingly. There are now 600 to 700 legal projects on OpenSea.
Connie Digital, a digital artist from New Jersey, started paying attention when the concept of NFT came out. He has been paying attention to Bitcoin since 2013, and after launching the crypto cat, he began to study Ethereum with great concentration: “In the process, I raised a cat, I bought a cat, and I sold a cat,” he told Decrypt. He later learned to make these NFT games. “That’s when I really started to change.” Now he is hosting an exhibition in the VR gallery and selling his artworks in exchange for his own token $HUE. He said: “Because NFT is still uncharted territory, it is very exciting.”
Finzer’s company now has approximately 20,000 traders, with a monthly transaction volume of approximately US$1 million. He estimated that the market turnover for the entire month was between US$4 and US$5 million. “Even today, we are still in its infancy. The number of people using NFTs is still very small.”
Problem art
NFT has attracted many serious artists. More than a dozen artists including photographer Lyle Oweko, graffiti painter Jon Burgerman and 3D digital art producer Perry Cooper have found new homes at Nifty Gateway. Nifty Gateway is an NFT market. A few months ago, it was founded by Cameron and Tyler Winklevoss, the founders of Gemini, a crypto exchange.
These works can be sold for several thousand dollars. Duncan Cock Foster and his brother Griffin co-founded Nifty Gateway. He said: “For me, what excites me most is that these digital artists have a large number of followers on Instagram. They have never had a way to sell their works before. This is the first time they sell their work to make money.”
Nifty Gateway launches new artists every Thursday, and their works can be sold out within a few hours. Jon Noorlander is a digital artist. Prior to this, he maintained his career by sharing artwork with 400,000 TikTok fans. He has now sold his digital artwork on Nifty Gateway. “He made that much money for the first time. This is really great,” Cock Foster said. In addition, Cock Foster did not disclose the share he received from these sales.
The pain of Ethereum’s growth
For Cock Foster, Ethereum has “the most collectors, the most tools, and the most basic infrastructure.” Even if NFTs are available on other blockchain networks, Finzer did not hesitate to choose Ethereum. He Said: “In the past few years, Ethereum has been the main chain of encrypted collectibles applications.”
This is probably because the infrastructure built by Ethereum can support the NFT community. For example, by connecting your MetaMask wallet to the encrypted collectible game Decentraland, you can transfer your NFT tokens to OpenSea or use it in another game, such as Cryptovoxels (similar to the virtual world of Second Life and Minecraft game). What you can do on Ethereum cannot be done on other chains.
But Finzer said that blockchain has ” substantial limitations .” Recently, due to the rise of DeFi (that is, decentralized finance), gas costs remain high, which makes it difficult to make games that rely on small transactions to obtain encrypted collectibles.
He said: “Now if you want to buy something on OpenSea, it almost always costs about $1 in gas.” “If you want to buy a game item that may only cost 50 cents each, it will be quite Bad user experience, which means you still have to pay an extra dollar in tax.”
This is why Shirley has been building a blockchain for NFT in the laboratory for the past few years. And this blockchain called Flow is still under construction. Shirley wants to move CryptoKitties to a new chain. The new chain promises not to pay high transaction fees and can support the entire NFT industry.
After the release of the Flow chain, it will not be able to support Ethereum, which means that NFT based on Ethereum and related games and markets will become out of reach. “The interoperability between decentralized systems is very challenging,” Shirley said. “This is a problem that I think no one can really solve.”
So, will NFT’s Ethereum community stray without authorization? Cock Foster believes that there is no reason to move Nifty Gateway to another chain, because Ethereum’s transaction fees are high, but it will not discourage those who are ready to invest $10,000 on JPEG. Although Connie Digital’s token $HUE relies on small transactions, she also believes that people will not rush to leave. “Although people are closely related to Ethereum. In any other business, if you provide faster and cheaper services, people still tend to new services.”
Shirley said: “The better the development of Ethereum, the better the development of NFT on Ethereum.” So, can the blockchain field provide a larger ecosystem than Ethereum today? “Yes, of course.”
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