Nfts
8 NFT primitives you should know
If DeFi has “money legos”, then NFTs have “culture legos”.
Another way to say that? NFT primitives.
In cryptography, a primitive is a fundamental element that can be used to create more complex systems or applications.
NFT primitives are important because they pave the way for new innovations and use cases around NFTs, allowing developers to create more sophisticated and versatile experiences.
To give you a better idea of the programmable possibilities here, let’s review 8 examples of some of the most notable NFT primitives today.
1. Zora Protocol Rewards
via Messari
When a creator selects the “Free + Rewards” pricing option when creating their NFTs on Zora, they become eligible to Protocol Rewards via fee split of 0.000777 ETH Zora Mint.
Upon new mintings, these rewards are accumulated in an escrow contract and can be withdrawn by the creator at any time.
Developers or platforms that facilitate the creation of NFT collections or direct collectors to new NFTs also receive rewards. This includes “create a referral” rewards for those who bring creators to the platform and “mint referral” rewards for those who bring in collectors.
As a result, Zora Protocol Rewards introduces a fundamental reward mechanism that can be leveraged to create new applications, for example self-funded alternative Zora interfaces. It can also be easily integrated into existing NFT projects and platforms.
2.ERC-6551
ERC-6551 introduced a fundamental change in the NFT space by allowing NFTs to function as their own smart contract accounts.
By allowing NFTs to own assets, interact with Web3 applications, and act as on-chain identities, ERC-6551 significantly expanded the basic properties of ERC-721 tokens. The composable nature of ERC-6551 means that it can be combined with other protocols and applications to create innovative new NFT utilities.
For example, the original architecture of the AI-based simulation game Parallel Colony was inspired by ERC-6551, as the standard allowed the game’s AI agents to act as wallets and manage their own token assets .
3. Boost
Booster is a distributed incentives protocol. It allows the deployment of incentives, i.e. tokens, to drive targeted on-chain actions, and recently we have seen more and more incentives deployed to drive engagement for new NFT currencies .
For example, you can set up a boost so that the first 100 miners of your latest NFT drop each receive $2OP as a reward. How you configure the settings, however, is entirely arbitrary and up to you.
That said, Boost’s open, composable design allows it to be easily integrated with other applications, allowing it to serve as an incentive for anyone who wants to exploit its capabilities.
4.DN-404
DN-404an optimized version of the ERC-404 experiment, helped popularize a new way of creating hybrid tokens that act as both fungible (ERC-20) and non-fungible (ERC-721) tokens.
As a result, DN-404 can be used in various applications, such as enabling fractional ownership of NFTs, increasing the liquidity of NFT projects, and creating new trading mechanisms that leverage both fungible and NFT properties.
5. Name protocol
One of the most popular NFT primitives is the Name protocol.
With this system, Nouns launched an all-in-one model for continuous NFT generation, auctions, and community governance. This foundation has inspired and been modified by several dozen spin-off projects to date, leading to the term “Nounish DAO”.
The fully on-chain nature of Nouns Protocol also means that developers can build new applications around Nouns as they see fit.
6. Liquid Delegates
Created by the Delegates team, Liquid Delegates introduced a new mechanism that allows delegation rights to be embedded in tradable NFTs.
By allowing NFTs to delegate rights, Liquid Delegates added the ability to trade those rights, claim airdrops, access token-gated communities, and much more, all without transferring ownership of the token. underlying asset.
Projects can use this feature for a variety of purposes, but we’ve typically seen it integrated so that users can securely create or claim tokens from their vault wallets.
7. Non-Fungible Vaults (NFV)
Developed by Open Dollar, Non-fungible chests (NFV) links Collateralized Debt Positions (CDP) to transferable NFTs instead of protocol accounts.
This primitive makes ownership of stable debt positions liquid and transferable, thereby improving capital efficiency and flexibility.
In other words? NFVs are paving the way for the first secondary lending markets in DeFi, and they can be integrated into DeFi in new ways thanks to their existence as NFTs.
8. Liquid Lists
One of the most recent NFT primitives is Flayer Liquid Listswhich allow rarer non-floor NFTs to be deposited into collection pools in exchange for “floor tokens”.
These tokens, for example ƒMILADY, represent the floor value of the NFT and can be sold to provide immediate liquidity, with the remaining listing value realized upon the final sale of the NFT.
Notably, this primitive uses Harberger fees to ensure fair pricing, thereby facilitating the sale of non-floor NFTs and fast, seamless access to liquidity.