Built on the same technology as Bitcoin, NFTs (Non-fungible Tokens) have been the talk of the town. In 2021, the digital art market exploded as we witnessed some sky-touching sales, with Pak’s The Merge at $91.8 million and Beeple’s The First 5,000 Days at $69 million. Like water in the Sahara desert, crypto enthusiasts run after NFTs like crazy, resulting in established marketplaces. NFT markets such as OpenSea, Rarible, and LooksRare allow smooth creation and trading of NFTs, making it a win-win deal for both artists and traders. If you also have been consumed by the NFT craze and want to start your NFT collection, it is essential to consider which blockchain you will develop your project on. This article will explore the technical aspects behind a good blockchain and look into some of the most popular ones.
With the explosion of cryptocurrencies and NFT, we now have a variety of blockchains available in the market. With all the options out there, it has become tough to choose one that is best suited for your NFT project. However, there are several factors that you must keep in mind before you venture into developing your NFT project.
The speed of transactions is one of the main elements to the success or failure of a blockchain project. Among all the available blockchains, the one with higher transaction speed will perform a more significant number of transactions at a given time. Transaction speed also significantly influences the transaction cost and blockchain security. If a blockchain has a slower transaction speed, users will have to pay higher fees to miners for prioritizing their transactions over others. With a fast transaction speed also comes added security as attackers will have a smaller time frame.
Except for NFTs from renowned artists like Beeple or notable projects such as CryptoPunks, most NFTs available in the marketplace are relatively affordable. If an NFT doesn’t cost much to buy, no one would want to pay high transaction fees that can match the price of the NFT itself. When developing an NFT project, the transaction cost (gas fees) plays an integral part in the broader adoption of your NFTs. If you choose a blockchain with a feeless structure, you can draw more interest in your project.
Smart contracts are the base of any NFT or Web3 project as they define the terms and conditions of trade between two entities on the blockchain. The entire security of the platform depends on the smart contracts, so you must have sophisticated and well-crafted smart contracts. Choosing a blockchain with robust and reliable smart contract functionality is vital in avoiding security threats. The language of smart contracts employed by the blockchain is also an essential factor. While it is easy to find specialists in well-known languages like C++, you will have a hard time looking for experienced developers in Solidity, which is used for Ethereum smart contracts.
Sometimes blockchains employing a particular consensus mechanism might be more prone to attacks than other consensus mechanisms. Statistically, platforms operating on the proof-of-work consensus face more attacks than platforms using proof-of-stake. So while choosing a blockchain for your NFT project, you can prioritize the ones using proof-of-stake consensus or any related consensus such as proof-of-history and proof-of-staked-authority. The most popular blockchain, Ethereum, is also considering upgrading from its current proof-of-work model to proof-of-stake consensus in Ethereum 2.0. The consensus of a blockchain also has a significant impact on the environment, like using proof-of-work causes high greenhouse gas emissions.
Security is another crucial factor that you must consider when choosing a blockchain for your NFT project. With the development of blockchain technologies, many threats have also been increasing. Some blockchains can be vulnerable to specific security threats, such as man-in-the-middle attacks and fifty-one percent attacks. As discussed earlier, the proof-of-work consensus is more prone to attacks where attackers gain access over most of the network’s computational power. If you do not choose a secure blockchain for your NFT development, you can lose access, data, and money to the attackers.
We know that you expected Ethereum on the list, as it has become the most popular blockchain for NFT projects. In 2015, Vitalik Buterin launched the Ethereum blockchain and presently has many developers. Ethereum comes with detailed technical documentation, which comes in handy while building dApps and smart contracts along with bug removal and adding new and advanced features. Ethereum’s ERC-721 standard is used to mint new NFTs, and ERC-1155 is applied to make new semi-fungible tokens. These two standards are the foundation of most NFTs that you see today, and we can expect this trend to grow more. Ethereum has recently come up with the ERC-2039 standard that allows the minting of multiple NFTs at once for saving gas fees.
You need to use Solidity for implementing smart contracts on the Ethereum blockchain. Solidity is Ethereum’s native programming language that can be compiled by the EVM (Ethereum Virtual Machine), and the blockchain has its token known as Ether (ETH). The major problem you will find with the Ethereum blockchain is the high transaction fees due to network congestion (it can do up to a few hundred dollars per transaction). With the upcoming Ethereum 2.0 update, we have been promised a blockchain with higher transaction capacity and low gas fees. Most NFT platforms with the most significant trade volume, like OpenSea, Rarible, SuperRare, etc., are on the Ethereum blockchain. Also check out: How to Mint an Ethereum NFT: A Full Guide.
Frequently referred to as the best alternative for Ethereum, Flow was launched in early 2020. Flow is a consumer-centric blockchain, and its developers are working on continuously improving the user experience. It offers enhanced scalability and composability to new developers and promises to deliver many more opportunities to NFT enthusiasts. The Canada-based company which introduced us to CryptoKitties, Dapper Labs, is behind Flow’s development. Flow utilizes the environment-friendly proof-of-stake consensus and can support games and digital collection ecosystems.
Flow utilizes its native Cadence programming language as the core of its smart contracts. You can create upgradeable smart contracts with Cadence for much greater scalability than Ethereum. Compared to Ethereum’s 13 to 15 transactions per second, Flow can execute more than 10,000 transactions per second with transaction costs as low as 0.000001 FLOW. NBA Top Shot is among the best examples of a Flow-based NFT marketplace. Flow has its own set of APIs, which is well documented and comes with guidelines for new developers.
Binance Smart Chain (BSC) is an independent blockchain that runs parallel with the Binance Chain and has a Solidity and Vyper smart contract compatibility. BNB is the native currency on the Binance Smart Chain and is used to run smart contracts. The blockchain is dependent on 21 validators and employs the proof-of-staked-authority consensus to lower the fee. If you are developing a project on the Ethereum blockchain, you can easily port it over to the Binance Smart chain and access various on-chain tools and dApps.
Due to Binance Smart Chain’s high performance and low fees over the Ethereum blockchain, countless developers and projects are now shifting to BSC. About 55 to 60 transactions can take place per second on BSC compared to Ethereum’s 13-15. Also, the gas fee is only around 3$, which is just a fraction of what you need to pay on Ethereum. Like Ethereum’s ERC-721 standard, BSC has its BEB-721 standard for NFTS. A few popular projects on Binance Smart Chain for trading NFTs are Bakery Swap for trading collectible NFTS and Pancake Swap for trading financial NFTs. Do check out: How to Mint an NFT With BNB?: An In-Depth Guide
Cardano is a well-crafted proof-of-stake blockchain pioneered by the co-founder of Ethereum, Charles Hoskinson. The Cardano blockchain was mainly built to do transactions in its native currency ADA and help developers build highly scalable applications on the blockchain. It has two layers; one is responsible for sending ADA from one account to another and recording the transaction (the Cardano Settlement Layer). Another has the smart contract code developers use to move funds (the Cardano Computation Layer). The smart contracts on Cardano are written in its smart contract programming language, Plutus.
Currently, Cardano has a transaction rate of more than 250 transactions per second, and it can be increased to 2000 transactions per second with Hydra, Cardano’s Layer 2 scaling protocol. The transaction cost is as low as a few pennies, making it a much better alternative than Ethereum and other high transaction cost blockchains. Spacebudz, CardanoKidz, and Professor Cardano are among the most popular NFT projects running on the Cardano blockchain. It has come up with its standard of CIP-721 that implements the concept of non-fungible tokens of appreciation (NFTAs).
Solana gives Cardano and Ethereum tough competition as one of the fastest programmable blockchains. It has reached more than $65 billion in market capitalizations during its peak and is a platform for numerous DeFi, Web3, and NFT projects. A mix of proof-of-stake and the proof-of-history consensus is implemented in the Solana blockchain. Unlike most notable blockchains using self-developed programming language, you can deploy smart contracts on Solana using C, C++, and Rust. This makes it easy to find professional developers for your project without breaking the bank. The transaction fee is meager at about $0.00025 and fits the wallet-friendly theme.
The Solana blockchain can execute more than 65,000 transactions per second and is said to grow up to 700,000 transactions per second as the Solana network grows. This transaction seed has made Solana a suitable blockchain for mass adoption. The secret behind such fantastic speed is the hybrid protocol that significantly decreases the validation time for all smart contracts and transaction execution. Despite being new compared to other notable blockchains, Solana has a vast number of successful NFT projects like Degenerate Ape Academy and Solana Monkey Business. The blockchain also allows users to develop advanced marketplaces for trading these NFTs. Some of the famous marketplaces on Solana include DigitalEyes.market, Solanart.io, and Solsea, where you can buy and sell NFTs.
After the initial popularity spike in 2021, NFTs have started penetrating every industry, starting from the art industry. Both small-scale and large-scale businesses want to launch their own NFTs to generate revenue. But before you head out to work on the project, make sure you select the correct blockchain. The long-term success will depend on the blockchain you choose at step 0, so take your time and analyze all the blockchain characteristics. If you want short-term popularity, then Ethereum is the apparent answer. It is the go-to blockchain for significant projects. But if you wish for long-term sustainability, Solana is the best out of the lot, with low transaction fees along with excellent throughput.