NFT Asset Strength
Last updated
Last updated
NFT Asset Strength is DappRadar's effort to measure the immutability of an NFT.
Technically, an NFT is nothing more than a contract that tells some software that the NFT owner has exclusive access to a certain digital item. What happens to an NFT when a game closes its servers and deletes all images? Or what happens to the metadata in that case? Well, that information would disappear. This lowers the Asset Strength of an NFT.
However, when an NFT, its images and its metadata are all stored on the blockchain, then the NFT will exist as long as the blockchain is live. This would make for a high Asset Strength.
There are 3 points that determine the Asset Strength of an NFT. Two of these form the so-called metadata.
Media storage
Data storage
Smart contract
What you see on your screen is an image, but in the background, there’s all kinds of data that ultimately shapes the NFT as it is. That’s the metadata. This could be images, audio files, videos, but also JSON data containing info about unique traits. Think about the attack power of a virtual sword or the rarity of a certain trait.
It’s in the metadata that we can identify weaknesses in NFTs. When this data gets stored on centralized servers, websites, it will get deleted someday. Think about account-based services like Amazon Web Services and Google Cloud. The question isn’t if, but when.
IPFS would already be a better solution for storing NFT metadata, but also data on IPFS can disappear.
Another, and cheaper, solution would be Arweave, a decentralized storage provider where data can be stored following a one-time payment. Storing on the blockchain, often called on-chain, is considered the best and most resilient method.
As the buyer of an NFT, you want the certainty that the technology your NFT uses is flawless. Because every NFT collection uses its own smart contracts, it’s important that these smart contracts are verified.
In this case verified means that the smart contracts are open to the public, for everybody to see and read. When this is the case, the smart contract gets verified on for example block explorer websites like Etherscan.
On Etherscan, go to the right page, click ‘Contract’ and then verify under ‘code’ whether the Contract Source Code has been verified or not. You can find the Etherscan contract page on the Single NFT Page.
DappRadar looks at each of the criteria and automatically calculates the Asset Strength based on the on-chain information. The NFT Asset Strength evaluation doesn’t equal any investment advice. A low score doesn’t mean that a product isn’t trustworthy, and a high score doesn’t mean that it’s the best product ever.
Ultimately the Asset Score is a measurement to determine whether the current NFTs in a project are able to exist even if a project shuts down. From that perspective, you could view the Asset Score as a likelihood for eternal existence.
These are the scores we give
Smart contract
Verified: 30 points
Unverified: 0 points
Media file
Centralized server: 0 points
IPFS: 25 points
Arweave: 35 points
Pinata: 35 points
On-chain: 35 points
Metadata File (JSON)
Centralized server: 0 points
IPFS: 25 points
Arweave: 35 points
Pinata: 35 points
On-chain: 35 points
Let’s take a look at some possible scenarios. A smart contract could be verified, while both data and images are stored on IPFS. This would mean that the particular NFT would have an 80% score.
Verified + IPFS + IPFS = 30% + 25% + 25% = 80%
However, Avastars has a verified smart contract, stores its metadata on the blockchain, and loads its images from the blockchain as well. As a result this project would get a 100% score.
Verified + On-chain + On-chain = 30% + 35% + 35% = 100%
Now let’s look at a trickier example, a popular blockchain game like Axie Infinity.
They have their smart contract verified on Etherscan, but both images and data get stored on centralized servers. They do this because they are actively developing, tweaking and building the game. This would give Axie Infinity a 30% score.
Verified + Centralized + Centralized = 30% + 0% + 0% = 30%
This shows that the quality of a project should not be concluded solely based on our DappRadar Asset Strength score.
