Have you heard about Solana's NFT compression?
NFT compression allows you to mint a billion NFTs at the same cost as one? Sounds too good to be true, right? Not really.
A 🧵
1️⃣Compressed NFTs (cNFTs) are NFTs where most of the data is stored off-chain but is referenced using a unique on-chain "fingerprint", enabling users to save cost.
twitter.com/metaplex/status/1589294588434722819?s=20
2️⃣This method reduces the amount of data stored on-chain, which is a significant hindrance to the mass adoption of web3 due to high transaction fees. So, there's a need to tackle high costs if we want to onboard a billion people.
3️⃣No doubt, it costs significantly less to mint NFTs on Solana - about 0.012 SOL per NFT. When compared with Ethereum, it is cheap. Nonetheless, Solana wants to do more.
0.012 SOL on one to a hundred NFTs is fair enough for gas but with a million, we can't say the same.
4️⃣That's why @metaplex introduced NFT compression on Solana. This innovation can reduce cost by over 1000x, making it significantly less to mint NFTs.
5️⃣@metaplex designed the Bubblegum program to compress NFTs while still ensuring decentralization.
It is a smart contract protocol that uses Merkle trees, which are a way to verify the integrity of large amounts of data efficiently.
6️⃣With Bubblegum, the tree's history is stored on the Solana blockchain, but the entire tree can be constructed off-chain.
This approach significantly reduces the cost of storing on-chain NFT metadata from 0.015 SOL to as little as 0.00000005 SOL.
twitter.com/magicblock/status/1643023157211561988?s=20
7️⃣The process involves compressing the NFT metadata into 32 bytes using a hash function and storing it in Gummyroll.
Gummyroll is a generic Merkle tree program that ensures that each leaf on the tree is an encoded representation of a Metaplex Token Metadata NFT.
8️⃣One common question is whether cNFTs can be used with an on-chain program. It's a two-way street. If the program is designed to work with compressed NFTs, it will. If not, the compressed NFTs will be decompressed. How?
9️⃣To decompress, a token metadata program will check and update the tree to make the leaf zero.
Decompressed NFTs can also be compressed again—however, when an NFT is compressed again, the accounts are destroyed again to prevent reentrancy attacks.
🔟Why choose cNFTs over traditional NFTs?
👉 Creation of high-volume, low-cost NFTs
👉 Seamless user onboarding experience
👉 Reduced on-chain storage
👉 Transferred and delegated like regular NFTs
1️⃣1️⃣Not long ago, I minted the Genesis sticker pack on Dialect, and it cost me nothing – I mean 0 transaction fees.
twitter.com/solflare_wallet/status/1640765210259488768?s=20
1️⃣2️⃣You may ask, is this not similar to the much discussed gasless transactions?
No, it is not. Those transactions are paid by third parties. So, it is free because someone paid.
On Solana, it is free because NFT compression reduces the amount of data stored on-chain.
1️⃣3️⃣Even though cNFTs have been around only a short time, many projects are tapping into its limitless use cases.
These projects include:
@crossmint: Airdropped over 300k NFTs in one afternoon
@HeliumFndn: Compressed its entire chain, including 1 million hotspots NFTs.
twitter.com/drip_haus/status/1641222281774104576?s=20
1️⃣4️⃣Other Use Cases of Compressed NFTs
👉Gaming: Compressed in-game assets
👉Event ticketing: mint tickets as digital collectibles
👉Social media dApps
👉Digitization of records aiding tracking of inventories
👉Tokenizing of scene graphs for GPU rendering
Further readings
metaplex.notion.site/Compression-for-NFTs-Public-94f9faa25f034110b513414a11a85bbe
helius.xyz/blog/solana-nft-compression
alchemy.com/overviews/compressed-nfts
👉Read on Paragraph👈
paragraph.xyz/@bintuparis/compressed-nfts
Cc: @SuperteamDE