Layer 2 Aventus Network for Non-Fungible Tokens
August 13, 2021
How Aventus can solve Ethereum challenges and level up the NFT space
If you haven’t heard of the term NFT, where have you been in the past 6 months? As with many quickly evolving technologies, NFTs present exciting opportunities for individuals or companies seeking to extend their brand into profitable new arenas. Their sales volume has skyrocketed to $2.5 billion in the first half of 2021. Artists, celebrities and organizations like Twitter, CNN and the US Space Force have jumped onto the trend. According to DappRadar, which tracks data on NFT sales platforms that are based on blockchain networks like Ethereum, noted the explosion in growth, particularly over the last 12 months. Worryingly, however, Ethereum’s scaling issues may be a detrimental factor in the fast-growing NFT market.
Aventus Network is the next-generation solution that addresses Ethereum’s scaling issues while honouring Ethereum’s commitment to decentralisation.
What are NFTs?
NFTs stands for non-fungible tokens. The word ‘fungible’ essentially means that something is interchangeable. In economics, money is a fungible asset. It has units and can be easily interchanged (such as swapping a £20 for two £10s) without losing or gaining value. Fungible assets also include things such as gold, cryptocurrency, and shares. A non-fungible asset, on the other hand, is a one-off in terms of value. For example, a painting can be copied or photographed, but the original is still the original, and replicas don’t have the same value. So that’s fungibility. Now, token refers to a digital certificate stored on a secure distributed database called a blockchain. A digital token can represent ownership of anything, from houses to pieces of art and collectibles. To sum up, NFTs are unique representations of data stored on a blockchain digital ledger. Each NFT acts as a kind of certificate of authenticity, showing that a digital asset is unique and can be bought and sold like any other piece of property.
How NFTs work
When a NFT is purchased, the transaction is processed through a network of computers that retain a digital record of all trades ever executed for that specific token. This decentralised network is called a blockchain, which ensures every computer agrees with any change to the ledger — as is the case with paper documents, when a car is traded, for instance. When an NFT owner sells their token, a fresh certificate is generated for the new owner — thus always confirming the item’s authenticity. This process ensures maximum security when trading.
Characteristics of NFTs
- Limited: The value of NFTs comes from their scarcity. Each NFT is different from another.
- Indivisible: Most NFTs are indivisible into smaller units. You either buy the complete cost of a digital item or buy no item.
- Unique: NFTs have a strong information tab that explains their uniqueness. This information is fully secured and genuine.
Benefits of NFT
- Easily Transferable: NFTs are purchased and sold on special marketplaces. The use of NFTs depends on their originality.
- Trustworthy: Blockchain networks are secured by protocols such as proof-of-stake, meaning you can trust data is correct.
- Maintain Ownership Rights: Blockchain technology processes non-fungible token transactions. Therefore, you know that your NFT ownership certificate is accurate with a decentralised and permanent record.
Why You Should Know about NFTs
NFTs create opportunities for new business models that didn’t exist before. Artists can attach stipulations to an NFT that ensures they get some of the proceeds every time it gets resold, meaning they benefit if their work increases in value. What you should know, however, is that NFT is more than art.
The potential of NFTs goes much further, because they completely change the rules of ownership. Transactions recorded on blockchains are reliable because the information cannot be changed. Smart contracts can be used in place of lawyers and escrow accounts to automatically ensure that money and assets change hands correctly and both parties honour their agreements. NFTs convert assets into tokens so that they can move around within this system.
This has the potential to completely transform markets like property and vehicles, for instance. NFTs could also be part of the solution in resolving issues with land ownership. Besides, if more of our lives are spent in virtual worlds in the future, the things that we buy there will probably be bought and sold as NFTs too.
Industry That Can Leverage NFTs
- Art: NFTs can be attached to digital art which gives the ability to own and trade digitally.
- Fashion: Imagine an NFT as the digital “twin” of a real-life garment, or imagine 3D clothing worn by a gaming avatar.
- Music: A huge industry that will absolutely be disrupted by NFTs. There are so many middlemen that stand in the way of artists and their fanbase/distribution.
- Game Items: Imagine your skins, guns, armor, pets, characters are all NFTs that you can upgrade and sell.
- Collectibles: The concept of ownership and the desire to have something iconic seems to be alive and well for even the digital world.
- Insurance: Whole Insurance policies or financial services contracts can be owned as NFTs.
- Event ticket: Tickets as NFTs are a killer use case. Imagine being sent a ticket to your wallet you could use to get into certain virtual exclusive events or even physical ones.
How Aventus Network Levels Up NFTs
The mushrooming popularity of NFTs and the influx of collectors have led to congestion on the Ethereum network, resulting in impractically expensive fees for simple transactions. Aventus Network adopts layer 2 solutions to take a much-needed load off the Ethereum network, drastically improving scalability.
Improvement on Scalability and NFT User Experience
The Aventus Network (AvN) can theoretically scale to 2,000 transactions per second. This is 133 times more than Ethereum.Besides, the AvN will process a token transfer within 0.13 seconds. This is 100 times faster than the Ethereum blockchain. The instant resolution dramatically improves the experience for NFT trading. It also removes scalability-related constraints on developers when building services.
Almost Gasless NFT Transactions
The average transaction cost on the Aventus Network will begin at just $0.01 (paid in AVT) and decrease over time. This is 99% cheaper than the average Ethereum transaction fee over the past year.
Environmentally Friendly NFT Trading
The security of proof of work blockchains requires a lot of computations. Put it simply, they use a lot of electricity. Conversely, layer 2 solution Aventus Network spends much less energy to ensure the sustainability of NFT transactions.
The NFT market is booming like never before. Most NFT applications are built on the Ethereum network but it is the victim of its own success. Particularly, high gas fees and poor user experiences limit mainstream adoption. With Aventus Network, a layer 2 solution that solves the bottlenecks of Ethereum, it will however pave the way for NFT mainstream adoption. One day, you may see every item on the street have a digital twin in the blockchain world.