Tag: Pastel

What Are NFT Smart Contracts & How Do They Work?

Posted on by Andrew Amarosa

NFTs, wouldn’t exist without smart contracts, and digital agreements written with computer code and deployed on a blockchain. Their main function is to execute one or multiple actions if conditions are met, often following simple “if/when-then” statements, e.g., if X is true, then Y will happen. 

These programs automate execution, and workflow, and streamline the outcome of an agreement between one or multiple parties without the need for an intermediary. These actions, for example, could be the transfer of funds from one wallet to another, storing an NFT, locking deposited funds into a liquidity pool, and more

NFT smart contracts have an important role in keeping the NFT ecosystem healthy and honest Some of their most important functions include handling royalties, ensuring the NFT is unique and non-replicable, verifying ownership rights, and enabling access to exclusive NFT merchandise or events (NFT projects usually throw around exclusive benefits to those who buy a specific NFT from their collection).

What are NFT Smart Contracts?

The versatility of NFT smart contracts plays a key role in the development of the metaverse and the Web3 industry. 

NFT smart contracts are smart contracts specifically designed to create the relatively complex requirements of NFTs, such as provenance, non-fungibility, authenticity, and the hosting on a blockchain network. 

First, let’s have a quick refresher on what a smart contract is. Then we’ll explore how they’re used in the NFT world. 

Smart Contracts: Benefits and Main Functions

Smart contracts are being applied to a wide variety of industries –home sales, supply chain, data sharing between multiple institutions, digital identity, banking —the list is long. 

For example, blockchain supply chain solutions counter the typical setbacks within this industry (data disparity, labor shortage, reliable shipping source, etc.) using smart contracts to automate the shipping process by keeping track of items, administrating and structuring important data, and performing specific tasks if conditions are met.

Some of the main benefits of smart contracts are:

  • Transparency and trust: they facilitate transactions for multiple users in a network without them having to know or trust each other. Everything is carried out by the smart contract and not the user, and participants in a private and public blockchain can see them.
  • Speed, lower costs, and accuracy: by eliminating intermediaries and paperwork and only executing actions they’re programmed to do when terms and conditions are met.
  • Versatility: smart contracts can be programmed to perform a wide variety of tasks, and can be reprogrammed after being deployed on the blockchain to fix bugs or eliminate vulnerabilities.
  • Security: smart contracts are highly secure programs since transaction records are encrypted.

Creating an NFT with Smart Contracts

Minting an NFT refers to the process of converting digital files, like jpegs, videos, and sounds, into an NFT recorded on the blockchain, making it available for everyone to see and purchase. When you mint an NFT, you’re playing with the underlying smart contract that defines the properties of your asset.

Most people experience minting an NFT through a designed, user-friendly website where all you do is press a button that says “MINT NOW” after connecting a wallet, but you can actually mint an NFT directly from its smart contract.

The smart contract assigns the ownership of the NFT to the buyer, but if they decide to sell it at some point, the smart contract of the NFT will automatically transfer ownership rights to the new owner —if conditions and terms are met. 

If an NFT is minted, NFT marketplaces like OpenSea would use another set of smart contracts to carry out the auction. For example, a popular auctioning method is a Dutch auction, which is usually created using an ERC721 NFT smart contract (explored below).

Minting NFTs has become much simpler than when they were introduced in Ethereum’s early days. SmartMint by Pastel Network, for example, is a no-code way to design and deploy an NFT smart contract. 

NFT Smart Contract Standards

There are several types of smart contract standards for creating NFTs; ERC-721 and ERC-1155 are the most widely common. ERC stands for Ethereum Request for Comment, and they refer to a set of technical guidelines for creating smart contracts or digital assets to run on the Ethereum network. 

ERC-721 is the first standard designed for the creation of non-fungible tokens, and it strictly requires all tokens to be non-fungible and have their own unique metadata. ERC-721 only supports NFTs, and each NFT can only be transferred in a single transaction, which tends to  cause congestion if network activity is high. 

On the other hand, ERC-1155 supports the transfer of multiple batches of NFTs and supports the conversion of fungible tokens (such as ERC-20) into non-fungible tokens, and vice versa. Typically, projects building blockchain games will use ERC-1155 to move their NFTs due to the higher level of versatility. 

Ethereum is the most popular option for creating or using NFT smart contracts. Other blockchain networks can have their own set of NFT smart contract standards. Still, a small problem is that, by not having a universal standard, NFTs created on different networks, such as TRON, for example, cannot be traded on marketplaces that support Ethereum, or Ethereum-related chains only like Polygon.

The Role of NFT Smart Contracts in the Metaverse

The metaverse refers to a digital ecosystem in which creators, artists, players, and anyone can explore virtual landscapes, play, socialize, interact with other users, buy and sell NFTs —and much more. 

The metaverse, popularized by Web3 projects like Decentraland and The Sandbox, is, therefore, an opportunity to bridge the financial world with the digital world, but the physical world also jumps in on the equation; physical real estate can be purchased as NFTs, using an underlying smart contract to carry out the process. 

NFT smart contracts in real estate eliminate the burden of intermediaries and hefty paperwork by granting (and verifying) the ownership and rights of a property to the respective party. One famous example of this is Michael Arrington, the founder of TechCrunch and Arrington Capital, who sold his apartment in Kyiv as an NFT.

Final Thoughts: NFT Smart Contracts and You 

NFT smart contracts are the technical backbone of the digital collectible industry. There are several NFT smart contract templates from different blockchains, each competing to provide the best technical guidelines and feasibility to users, NFT projects, and marketplaces.

That being said, NFT smart contracts are already playing a key role in the development of Web3 beyond PFPs of Bored Apes or digital samurais like Azukies. 

NFT smart contracts underpin a trustless and efficient pathway for everyone in the decentralized world to interact with NFTs. Blockchain gaming projects, companies and corporations from traditional industries such as fashion and food and beverage, and financial entities have taken a stab at what might be the next iteration of the internet —and smart contracts are the main pillar of the ecosystem.

What Does Minting Mean When It Comes to NFTs?

Posted on by Anthony Georgiades

Minting is the process of creating an asset on the blockchain. It’s the process used to create non-fungible tokens (NFTs,) which are blockchain-based tokens that prove ownership of an item such as a piece of music, profile picture, or image. 

They first grew in popularity in 2021, with collections like Bored Ape Yacht Club and CryptoPunks making international headlines for their huge price tags. Since then, brands such as Nike and Adidas have created their collections, doubling the number of collections in just one year. 

So what exactly is minting an NFT? How does minting work, and what does it cost? In this article, we’ll answer each of these questions: how long it takes to mint an NFT, the most famous mints, and how an NFT gas war can impact the minting price.

What Is Minting An NFT?

Minting an NFT is the process of creating an asset stored on the blockchain, where its authenticity and ownership are proven. The blockchain itself can’t be edited, which makes ownership indisputable.

Minting an NFT is usually completed on platforms like OpenSea, which provides users with the tools to mint their collection. In addition to these tools, creators will also need the art they plan to use and details of unique accessories and features. Some general knowledge about blockchain technology is also useful but not essential. 

To mint a collection, creators will need a crypto wallet with the cryptocurrency needed to put their collection on the blockchain. Most NFTs are created with Ether (ETH), though Solana (SOL) and Cardano (ADA) are also popular options. 

After paying all fees and uploading the necessary files to create a new token, the platform you use will register your new asset on the blockchain, which can be listed on exchanges to generate a crypto income,

How Does NFT Minting Work?

Minting For Creators

As a creator, minting an NFT lets creators create scarcity, secondary earnings, and verified ownership. Creators can create limited edition pieces, specialized collections, and more, all of which are validated on the blockchain. 

Minting also lets creators build communities and perks for collectors who buy their NFTs and generate a passive income through “creator fees,” which charge a small percentage of each secondary sale. 

Creators can complete the process on platforms like Solsea and Opensea, which cover all complex coding, allowing creators to focus on the art. 

Minting For Collectors

As a collector, minting allows you to become part of a community. When minting from a new project, collectors become the first-ever owner of a particular NFT. Minting from a new collection is like buying a pack of collectible cards; you never know how rare the NFT will be. 

Minting as a collector requires you to go to the developer’s website. On the website, there will be an option to “Mint.” Connect your wallet, pay all fees, and your NFT will arrive in around 30 minutes. 

How Much Does Minting Cost?

The cost of minting depends on the “gas price” (transaction fee.) This is paid to the blockchain and will vary depending on the time of day and overall activity. Minting an NFT can cost as little as $0.01 but can go as high as $500 to a few thousand dollars. If gas fees are particularly high when minting an NFT, you can always return later to mint at a lower price. Just make sure the collection won’t sell out before then!

How Long Does It Take to Mint an NFT?

Minting an NFT can take anywhere from 30 minutes to 3-4 hours, depending on how experienced you are with the platform. 

The actual minting process is the stage at which your NFT is published. Before minting, you need to create the art for the collection and decide how many NFTs you plan to create and how you plan to promote the collection.

Most Famous Mints

CryptoPunks

CryptoPunks was first released in June 2017 and became the most popular NFT collection of all time. What makes this mint famous is that it was completely free. Anyone with an Ethereum wallet could claim a CryptoPunk.

Following its release, many collections replicated the 10k profile picture trend, and CryptoPunks went on to sell for millions. As of December 2022, CryptoPunks remains the most valuable NFT collection on the planet. 

Quantum 

Quantum is commonly cited as the first NFT ever minted. It was minted in May 2014

(May 2014) on a site known as Namecoin. After its initial mint, Quantum was forgotten about for years until going on auction at Sotheby’s in June 2021, where it sold for over $1 million. 

The Eternal

The Eternal is the fastest-selling NFT collection to be minted, selling out in just seven minutes. It was released by Anthony Hopkins, who partnered with NFT company Orange Comet. It was sold on 13th October and showcased 1000 NFTs consisting of 10 unique animation NFTs and 990 unique images. 

What Is an NFT Gas War?

An NFT gas war is a bit like a bidding contest with too many bidders. It starts when the demand for an NFT is higher than its supply- for example when a popular new NFT collection is released. This increase in demand causes the blockchain to slow, and consequently, some investors tip blockchain validators to speed up the transaction. As a result, the gas fee increases based on the tip. 

To beat other bidders, investors will keep paying higher fees until most investors can’t afford the gas fees. This causes the overall traffic to decrease and prioritizes the highest bidders, which can be frustrating for investors with smaller budgets as it could price them out completely. 

It’s important to note that gas fees will also differ based on the platform and the time of day. In some situations, the gas fee can be higher than the listed sale price of the NFT. Therefore, it’s important you research the gas fee before selling or buying an NFT. 

Final Thoughts: Minting Isn’t As Complex As You May Think 

Minting an NFT isn’t quite as complex as it’s made out to be. While you need to consider factors such as gas fees and the platform to mint, once you have the designs in place, most platforms will take care of everything for you. Be diligent with your research beforehand and ensure that the gas fee is within your budget- the last thing you want to do is bid for an asset only to realize you can afford the gas. 

Minting is a great way to make money as a digital creator. As NFT technology advances, its use cases and widespread adoption will also increase, making it a great time to get involved in the market. 

Can You Copy an NFT Onto a Different Blockchain?

Posted on by Anthony Georgiades

Things can get a bit complicated when simply “copying” an NFT from one blockchain to another.

As a refresher, a blockchain is a decentralized collection of financial accounts across a peer-to-peer network. It’s used to confirm transactions without needing a central governing body, allowing users to make transactions without a third party. 

NFTs (non-fungible tokens) are unique cryptographic tokens that exist on a blockchain and cannot be replicated. They come in the form of NFT art, music, in-game collectibles, and much more. 

Although someone can duplicate an image of an NFT, the code confirms the actual ownership of an NFT. Think of NFTs like a piece of art in a museum. Although the art can be replicated, the museum holds the official ownership rights of the original piece. 

Currently, the NFT market is dominated by Ethereum, with 95% of NFTs being on the Ethereum blockchain. However, many collectors are fed up with high fees and slow transaction times on Ethereum. 

As a result, alternatives such as Solana and Polygon are now becoming popular alternatives for collectors, with investors using bridge technology to transfer their NFTs from one blockchain to another. 

This article will look at how NFT ownership works, how to transfer an NFT onto a different blockchain, and how to use the ​​Polygon Bridge to transfer your NFTs. 

How Does NFT Ownership Work?

When buying an NFT, you acquire a token on the blockchain. You might experience this NFT as a picture of a monkey or something, but in essence, you own a string of programming. This token is unique and represents a particular asset. For example, if you purchased an NFT on OpenSea, you’d own a code that shows you own that particular asset. 

Once you own an NFT, you can use it commercially, for example, printing the art on a shirt or using the design in a video. However, this doesn’t stop other users from saving your image, with saving an image becoming a meme since 2021. 

Not all NFTs give you copyright and intellectual property rights, so checking the details before buying is important. 

How Do NFT Transfers Work?

Originally an NFT would stay on the blockchain it was purchased on. However, a new technology known as a blockchain bridge lets you transfer an NFT from one blockchain to another. 

A blockchain bridge, also known simply as a bridge, is software that lets collectors move NFT across blockchains. These third-party programs actively monitor blockchains to ensure a smooth transaction. 

For example, one such platform, NFTrade lets you move NFTs from one blockchain to another, with six blockchain networks to choose from. 

To start, set up an account and connect your wallet. 

Click My NFTs and choose the NFT you want to move from one blockchain to another. 

On the top right corner of the NFT page, click the three dots and select the new wallet you want to send the NFT to. 

Click Transfer NFT and verify the transaction to complete. You can then disconnect your wallet from NFT trade, and the selected wallet will now own the NFT. 

Another way to transfer NFTs across blockchains is through the Polygon Bridge. 

What is the Polygon Bridge?

Polygon Bridge is a cross-chain bridge between Polygon (formally Matic) and Ethereum that lets users transfer NFTs from Ethereum to the Polygon blockchain. Users can transfer all ERC tokens through a dual consensus procedure using this two-way bridge. This procedure uses a Plasma bridge and Proof-of-Stake bridge to complete the transaction and remain decentralized. 

How Does The Polygon Bridge Work?

When using the Polygon Bridge, no new tokens are created. Instead, tokens leaving a particular network are locked and minted through another network. The new token is then created, and the old one is burned. 

Here’s how you can use the bridge:

  1. Connect your crypto wallet (such as MetaMask) to the Polygon Web Wallet
  1. Sign your wallet through the extension
  1. You’ll be taken to the Polygon Bridge interface. Here you can choose your token (supported tokens include MATIC, ETH, ERC20, ERC721, ERC1155, and several others.)
  1. You’ll be charged a fee for this process which will change based on Ethereum traffic.
  1. If you want to transfer your NFTs back to their old blockchain, click “Withdraw” and choose the tokens you want to return to their old blockchain. 
  1. Once the transaction has been validated, your NFTs will be available to claim in your crypto wallet. 

Alternatively, you can also use the Plasma Bridge to transfer Polygon NFTs and transfer them to ETH, ERC20, or ERC721 tokens. Here’s how:

  1. Open MetaMask and click “Switch to Polygon.”
  1. Your Polygon details will show the Polygon network’s details.
  1. From here, head to the Polygon Bridge, click “Withdraw,” and repeat the process above. 

Three transactions will need to be validated when completing a transfer on the Plasma Bridge. 

The first is to withdraw an NFT from your Polygon Wallet. 

The second starts a 7-day challenge period, where an individual can challenge the transaction (this is for additional security.)

The third is to confirm sending your NFT to the wallet. 

Overall this process is more secure; however not as fast as the normal Polygon Bridge. 

However, some NFT holders may be a bit unsettled by the fact that their original NFT token is “burned” in order to create a new one.

Why Would You Copy An NFT Onto A Different Blockchain?

Although Ethereum dominates the NFT market, it’s far from perfect. One of the biggest issues with Ethereum is the transaction fees. Fees are extremely high, starting at $50-100+ per transaction, which is significantly higher than any other blockchain. 

In addition to this, the fees themselves can fluctuate dramatically. One day you may pay $50 for a transaction; the next, you could be paying over $150. This frustrates NFT collectors trying to budget or profit from their investments. 

Alternative blockchains such as Solana and Polygon have significantly lower fees. For example, the average cost of Minting an NFT in Solana is just 0.00001 SOL ($0.01.) Consequently, Solana and Polygon NFTs are growing in popularity, as shown by the growth in sales. Solana NFT sales volume hit an all-time high in the week ending Sept. 12, hitting almost $50 million (1.5 million SOL.)

Final Thoughts: Is Changing Blockchain Worth The Hassle?

As blockchain technology advances, so will the number of ways you can move an NFT onto a different blockchain. Currently, platforms such as NFTrade and Polygon Bridge are great ways to change blockchain. However, they can appear a little complicated for new investors. 

So, is changing blockchain the best option for you?

This will depend entirely on your reason for buying an NFT.

Changing the blockchain may not be worth the hassle if you’ve purchased an NFT to hold it for the long term. Instead, holding your NFT in its current wallet would be better, and hoping the value increases. 

However, if you frequently trade NFTs, then changing blockchain could help save you some money on network fees. It would also help speed up your transactions, letting you make more daily transactions. 

Before making a decision, make sure you do your research to understand the transfer process and avoid unnecessary fees. 

Layer-1 vs. Layer-2 Blockchains: What You Must Know

Posted on by Pastel Network

Bitcoin did the heavy lifting of creating a peer-to-peer decentralized and tokenized financial network. One person can send another person halfway around the world $1,000,000 in BTC for a paltry $20, sometimes even as low as a dollar and change. 

The problem is that microtransactions, such as sending a friend $4 for a cup of coffee, cost the same. 

Similarly, Ethereum created an entire galaxy of possibilities for DeFi, NFTs, and other decentralized applications. However, the breadth of its value has also been one of its detractions– as network gas fees skyrocket in times of extremely high traffic, making using the network ludicrously expensive for users and developers alike. 

CryptoKitties, an early sensational NFT game, nearly ground Ethereum’s network activity to a halt in 2018 due to the throng of transactions. Even today, gas fees can be hundreds or thousands of dollars to mint a new Ethereum-based NFT. 

However, problems are usually followed by problem solvers. Hundreds of developers have dedicated their professional lives of late to either building decentralized apps to help scale projects like Bitcoin or Ethereum or creating more scalable networks from the ground up. 

Layer-1: The underlying blockchain architecture. For example, Bitcoin and Ethereum.

Layer-2: A network that sits on top of Layer-1, which facilities network activity. For example, the Lightning Network and Raiden Network.

The following Layer-1 vs. Layer-2 blockchain guide explores both approaches and how they contrast. 

Layer-1 vs. Layer-2 Blockchains: The Basics

Layer-1 updates usually involve consensus protocol changes or sharding. 

As you may know, Bitcoin and Ethereum use a gawky but effective consensus protocol called Proof-of-Work (PoW). It’s good at what it does because it works. However, as network activity grows, its limitations become unbearable for many. 

PoW requires miners to solve cryptographically-difficult equations via computational power– hence Bitcoin mining facilities that are just warehouses with specifically designed computers running 24/7/365

At times, transactions can take way too long for convenience’s sake and become very expensive. Bitcoin can manage about seven transactions per second, whereas Ethereum can do 15-20. 

Proof-of-Stake (PoS) is a relatively newer protocol; rather than computation power, it relies on people (validators) staking a certain quantity of holdings to validate transactions.

Changing consensus algorithms can be a divisive ordeal, and switching from PoW to PoS on a network as large as that of Bitcoin or Ethereum would require achieving agreement among the majority of participants, which can be extremely difficult. 

Sharding is another Layer-1 scaling strategy. Sharding breaks transaction sets into smaller chunks called shards, which the network can process at a much faster rate. Think of cutting a PBJ sandwich into small pieces (shards) versus eating it bite by bite. Each small piece you eat is a finalized transaction, whereas the latter approach would require the whole sandwich to be eaten before the transactions are final. 

Attempting to implement scalability measures on a Layer-1 blockchain would require a full or partial network update, which is a slow and contentious process; if things go sideways, the entire network could face enormous damages. 

Many projects have been launched to provide users the scalability that the more legacy cryptocurrency projects have struggled to do. 

For example, chains like Solana, Cosmos, and Cardano (yet to launch anything) have emerged in attempts to unseat Ethereum as the most popular blockchain network for dApps, primarily targeting its scalability issues and low-hanging fruit. 

The user experience tends to be much faster and cheaper on the newer Layer-1s– transactions on Osmosis, a decentralized exchange built on Cosmos, cost around a penny. In contrast, the Ethereum DEX UniSwap can cost dozens or hundreds of dollars. 

However, the opportunity to scale the world’s most popular Layer-1s instead of launch new ones from the ground up is an admirable and lucrative challenge accepted by many. 

They do so through Layer-2 blockchain innovation. 

Layer-2: Attempts at Scalability

Layer-2s are essentially sandboxes for creativity with minimal or zero disruption to the underlying network.

There are two types of Layer-2 blockchains: state channels and nested blockchains.

A state channel allows for two participants who would otherwise interact on the blockchain to interact off the blockchain, limiting the congestion of the network. 

Imagine Bitcoin’s or Ethereum’s blockchain as a 10-lane superhighway with bumper-to-bumper traffic. A state channel would be the back-road approach you could take to avoid driving into a slow, expensive network and get to your end destination at a fraction of the time and cost. 

Here’s how state channels work: 

  1. A blockchain segment is sealed off through a smart contract or multi-signature means, where all participants agree on the conditions. Lightning Network and Raiden Network used Hashed Timelock Contracts (HTLCs) for their state channels. 
  2. The transaction participants can then directly interact without needing to submit their request to the miners on the Layer-1. 
  3. When all the transaction sets on the state channel are complete, the final state is added to the blockchain. 

So, while a transaction is technically not “final” until added to the blockchain, state channel projects like Bitcoin’s Lightning Network and Ethereum’s Raiden Network effectively carry out the role of policing and verifying transactions. 

The idea is that these “batched” transaction blocks can effectively internally settle; when they do, the entire batch is added to the blockchain. As such, Lightning Network enables fast microtransactions (low fees, fast settlement), and Raiden does the same thing for Ethereum’s broader functionality. 

However, state channels have some limitations. 

Nested blockchains aim to increase scalability exponentially, whereas state channels are more linear. 

Ethereum is a popular breeding ground for decentralized apps to solve scalability issues. OmiseGO, for example, is experimenting with a nested blockchain scaling solution called Plasma. 

In Plasma, multiple levels of specific-use blockchains sit on top of the leading blockchains in parent-child connections. The parent chain then dedicates specific work to child chains, such as a social network or decentralized exchange.

The root chain still calls all the shots and sets the ground rules, but nested blockchains relieve some load. 

Final Thoughts: What You Should Know About Blockchain Scalability

While the differences between Layer-1 and Layer-2 solutions might seem exclusively technical, it’s worth considering that by collecting NFTs, holding tokens, and using dApps, you’re the direct stakeholder in the whole ordeal. 

While Ethereum enjoys a considerable first-mover advantage for NFTs (and DeFi), boasting multi-billion-dollar dApps like OpenSea, competitors are gaining on its tail. 

As an NFT investor or creator, being aware of broader industry trends like scalability is an excellent way to keep your ear to the ground, whether that be for the purpose of finding the next BAYC (on another chain) or creating the next homerun NFT brand for a diehard layer-1 alternative. 

Are NFTs Truly Decentralized Art?

Posted on by Pastel Network

There are quite a bit of misunderstandings around NFTs. Many people think NFTs are minted on the Ethereum blockchain through a platform like Rarible and — voila! — the art is non-fungible and lives forever in a decentralized manner on the blockchain. But that’s not entirely the case. NFTs, or “non-fungible tokens” are really only non-fungible to the extent that it refers to the actual token, not the underlying artwork or rare asset itself. As such, the token and the “asset” it represents are two completely different things.

Huh?

Okay, let’s rewind a bit here. Although NFTs are often associated with digital art or GIFs these days, the reality is that they are better understood as a class of assets that are non-fungible. The $10 bill you used to pay for the coffee this morning? Fungible. The fingerprint you left on the bill when paying? Non-fungible. But is your fingerprint an asset? Debatable, depending on how much fingerprints go for on the black market these days (a joke, relax). But a key thing to remember is that non-fungible does not classify an object as rare, nor does it ensure that it is ‘rare’ or even decentralized.

This concept was probably best illustrated with a recent “rug pull” stunt conducted by one clever sculptor on the OpenSea platform. The artist exchanged the original JPEG images that the collectors thought they were purchasing with random pictures of rugs after the sale concluded. The intent of the stunt was to highlight the inherent problem of the current NFT infrastructure — which is mostly built on the Ethereum blockchain. By purchasing the NFT, the buyer would simply own the token to authenticate the JPEG listed on OpenSea, which at the time of purchase was a dope piece of art. But because the underlying digital asset itself is not decentralized, and might be stored on a central server somewhere such as on AWS or GCS, the buyer has no control in terms of what the NFT itself represents.

In other words, the non-fungibility is currently applied to the token representing the transaction of the purchase — not necessarily the owner of the physical (or digital) piece of art.

This is a common problem in the NFT sphere, as buyers often misunderstand the underlying infrastructure of the art they are buying, which can be problematic when there isn’t a physical equivalent of the purchase, ie: a digital GIF.

With most NFT marketplaces being built on Ethereum, another key problem is raised. The Ethereum network is often congested by other sectors such as DeFi, which eat up the majority of the bandwidth and exponentially raises the prices for minting and transacting NFTs. When compounded with the previously outlined problem, it is easy to see why the NFT art space is not the perfect picture it is painted to be after all.

This is where a platform like Pastel can paint a brighter future. Unlike Rarible or OpenSea, Pastel has built its own layer 1 blockchain to compete with Ethereum based platforms. This brings with it an innate advantage because the underlying architecture is designed to be perfectly outfitted and purpose-built for the sole use case for digital art and other rare digital assets, rather than being a do-it-all blockchain like Ethereum. With fewer projects demanding bandwidth, minting and trading NFTs on Pastel is significantly lighter on your (digital) wallet as well due to very low gas costs

In regards to the main problem of preventing “rug pulls”, Pastel ensures that the art (or other NFT) itself is uploaded, verified, and registered on the Pastel blockchain — rather than just the token it is minted with. Through a series of smart tickets living on the Pastel ledger, artists can store their masterpieces in a distributed fashion across a variety of Supernodes as opposed to just ensuring the token is non-fungible. This sophisticated storage layer, leveraging the RaptorQ fountain code algorithm, ensures that each asset is broken up and stored in a series of redundant, fungible chunks. These sets of chunks ar ethen distributed across the network using the Kademlia DHT algorithm. So what does this really mean? In short, even if over 90% of hosted instances suddenly go down, the remaining information can be reconstructed quickly and there is no possibility of the artwork disappearing.

So the next time you purchase an NFT, make sure you understand how and where your rare digital asset is stored — so that you won’t have the rug pulled out from underneath you.

Learn more about Pastel Network, and join us below!

Website | Whitepaper | Telegram | Discord | Medium | Twitter |

Copyright © 2021 Pastel. All rights reserved