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Crypto decentralized applications create a new paradigm of data transparency that didn’t exist in the standard web 2.zero applications. I’ve argued earlier than that is a key function that will define the subsequent generation of consumer platforms. In this put up, I will try make this more concrete by showing you an example of this data transparency at work. In particular, we will dive deep into the data behind the meteoric rise of NFTs.

NFTs have skyrocketed into the mainstream consciousness over the past few months. From Time magazine creating TIMEPieces, to TikTok setting up a creator-led assortment, to Steph Curry buying a Bored Ape, NFTs seem to be everywhere. In case you might be unfamiliar, NFT stands for non-fungible token and is defined by the ERC721 and ERC1155 interface standards. In less technical phrases, they are unique, hence non-fungible, scarce, digital assets on the blockchain that may be owned and switchred.

The idea of digital ownership just isn’t new, and has been widely utilized in gaming contexts to permit players to customise their experiences by way of skins, upgrades, etc. The crypto model of digital assets and ownership is a significant evolution from this, because they are provably unique and not ruled by a single centralized entity. The actual fact one owns something on the blockchain may be independently verified by anybody who can access the blockchain ecosystem— making them a lot more portable across applications. For instance, one could imagine a world where the owner of an NFT avatar is the only one who is able to use that avatar across all their favorite social platforms. In that world, NFTs become augmentations of the digital identity, and might be extended to many more applications past just avatars. Nevertheless, this potential is essentially unfulfilled as we speak, and many NFT collections are, quite frankly, shallow projects that attempt to make a quick buck. This is why NFTs are such a polarizing topic — some consider that they pave the way for the metaverse and other consider they aren’thing more extremely over-priced JPEGs. I will not attempt to nudge you in one direction or another, but I’d like show you the way crypto data can be used the understand both the macro pattern and micro tendencies in NFTs.

NFT marketplaces

The first channels by means of which individuals have interacted with NFTs to this point have been exchanges like Opensea, Basis, SuperUncommon, Rarible, etc. Some NFT smart contracts, most notably Cryptopunks, additionally implement their own alternate capabilities. These exchanges are decentralized applications on the blockchain that enable customers to discover, buy and sell NFTs. By decoding the transactions, traces, and logs generated by these smart contracts, using the techniques I described in this publish, we will create a dataset that contains the details of each single NFT trade within the Ethereum ecosystem

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