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The ABCs of NFTs 🔤
What you can do beyond simply buying and selling NFTs!
Metaversal is a Bankless newsletter for weekly level-ups on NFTs, virtual worlds, & collectibles
Dear Bankless Nation,
It’s a misconception that the only thing you can do with NFTs is collect and trade them.
Of course, the NFT ecosystem is incredibly nascent, but there does already exist a compelling and varied range of different things you can try with NFTs, and these use cases are pointing to many more possibilities going forward.
As a reminder of just how teeming the NFT space is in the here and now, let’s go over the “ABCs of NFTs” — my take on a different NFT-related verb for each letter in the Latin alphabet.
Last thing: make a note of any of the utilities you’re not familiar with below and consider exploring them deeper to level up your NFT skills! Now, let’s dive in.
The ABCs of NFTs: A Quick Glance Across the NFT Landscape
A for “Annotate” — Experiments like NFT Scribe make it possible to append onchain messages to Ethereum ERC721s.
B for “Borrow” — BendDAO employs an NFT liquidity system based on a peer-to-pool model. This approach lets NFT holders use approved assets as collateral to instantly borrow ETH from the lending pool. Meanwhile, depositors supplying ETH liquidity can earn interest on their contributions.
C for “Catalog” — JPG Canons is a token-curated registry (TCR) system. These directories are community-sourced NFT lists, e.g. Derivative NFTs, created as public goods for mapping out Ethereum’s cultural landscape. (Disclosure: I contribute to JPG!)
D for “Draw” — OKPCs are dynamic NFTs whose surface you can change with your own pixel illustrations! Think of it like an onchain Etch-a-Sketch toy.
F for “Follow” — Lens is a rising social media platform on Polygon that mints Follow NFTs to track who follows who onchain.
G for “Game” — NFTs can be used as digital game pieces, wearables, and virtual land like we see in games such as Axie Infinity.
H for “Hang IRL” — If you’d like to enjoy your favorite NFTs throughout your home or elsewhere, physical displays like Infinite Objects are a great place to start.
I for “Insert” — Projects like Charged Particles make it possible to insert NFTs into other NFTs, similar to how you might store multiple documents within a single folder.
J for “Jam” — The music NFT scene continues to gain traction, which makes web3 music players like Spinamp really convenient for enjoying and organizing playlists of your favorite songs.
K for “Keep Safe” — Safety-focused services like ClubNFT make it simple to backup the metadata of your NFTs for the long term.
L for “Loan” — On peer-to-peer lending platform NFTfi, lenders can propose loans on available NFT collateral, specifying loan amount, duration, interest rate, and so forth. If loans go unpaid, lenders receive the underlying NFT collateral.
M for “Migrate” — LayerZero Labs creates infrastructure that makes it possible to bridge NFTs to new chains, e.g. the recent opening of the Lil Pudgys Bridge.
N for “Name” — The Ethereum Name Service (ENS) allows users to register human-readable domain names and subdomains to simplify Ethereum addresses and make it easier for individuals to interact with blockchain-based services.
O for “Organize” — NFTs can be used for organizing activist efforts, such as we’ve seen with the raising of funds for Ukraine’s defense. By creating and auctioning or selling NFTs, people can mobilize resources and raise awareness about real world causes.
P for “Provide Liquidity” — Earn yield on your NFTs by supplying them as liquidity to service decentralized NFT exchanges like Caviar.
Q for “Quest” — Build up your onchain credentials by amassing Quest Receipts on RabbitHole V2’s new Quest Protocol.
R for “Rent” — You can rent out your idle NFTs via platforms like reNFT and delegate.cash as we saw from more than a few Sewer Pass holders during Yuga Labs’s recent Dookey Dash competition.
S for “Squad Up” — The new and improved PartyBid app makes it simple for you to team up with small squads of friends or large groups of strangers for NFT-based activities, e.g. an onchain Tic Tac Toe battle between two DAOs.
T for “Track Crypto” — Price tracker sites like CoinGecko are cool, but NFTs like Finiliar have in-built oracles so their dynamic “moods” reflect and track associated crypto prices. It’s certainly the cutest way to monitor crypto!
V for “Vote” — Bud Light owns Noun 179. Bud Light N3XT NFT holders collectively vote on Noun 179's decisions, making N3XT NFTs (~0.01ETH right now) an affordable way for NFT enthusiasts to access Nouns DAO voting.
W for “Wrap” — It’s possible to “wrap” NFTs that pre-date the ERC721 NFT standard into modern NFTs, e.g. Wrapped CryptoPunks, and it’s possible to wrap NFTs into fungible currency like we’ve seen with Wrapped CryptoKitties (WCK) tokens.
X for “(E)xplore” — Check out events around Ethereum’s metaverse scene where virtual land is managed and organized via NFTs.
Y for “Yield” — Hook Earn enables NFT owners to generate yields on idle NFTs by listing them for sale at a specified future date and price. Traders pay NFT holders upfront for potential future earnings, and if the NFT sells at a higher price, the trader earns the difference. Currently in its early stages, Hook Earn has a waitlist for interested users to sign up.
Z for “Zoom” — Hologram, created by Hologram Labs, allows users to assume the form of their favorite NFTs in video content and live video chats through motion capture technology.
The Big Picture
As demonstrated by this "ABCs of NFTs" exercise, there are already many ways to interact with, enjoy, and benefit from NFTs across various applications and platforms.
From annotating and borrowing to gaming, organizing, and even managing virtual presence, the NFT ecosystem continues to evolve and expand in all directions, providing unique opportunities for users to engage in digital life in new ways. It’s not all just buying and flipping, right.
As you go deeper and test out these range of utilities, you'll not only widen your NFT skills, but you’ll also gain insights into the future of this nascent yet rapidly growing industry. Happy exploring in the meantime!
Explore the ABCs of NFTs: Try some of the use cases above that you’re less familiar in order to level up your NFT skills 💪
Read my previous weekly roundup if you missed it: The NFT Frontier 🤠
William M. Peaster is a professional writer and creator of Metaversal—a Bankless newsletter focused on the emergence of NFTs in the cryptoeconomy. He’s also recently been contributing content to Bankless, JPG, and beyond!
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Not financial or tax advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This newsletter is not tax advice. Talk to your accountant. Do your own research.
Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. Additionally, the Bankless writers hold crypto assets. See our investment disclosures here.