What Is xNFT’s Potential? Introducing the New Wave of Digital Assets

From new coins to unique non-fungible tokens (NFTs), crypto enthusiasts can enjoy a wide variety of options to trade. NFTs have transformed the crypto landscape by introducing unique ownership of digital assets. So, what is xNFT’s innovation? It’s an executable NFT with code written into the token that powers dynamic functionalities and interactive elements!

Simply put, xNFTs enhance the capabilities of traditional NFTs by enabling complex interaction within the NFT. You can play games, listen to music, or access decentralized finance (DeFi) services. However, xNFTs are exclusive to Solana and work on Backpack, Solana’s wallet.

If you’re looking for traditional NFT trading, check out popular crypto exchanges like Binance or Coinbase. You’ll find NFT marketplaces with numerous digital art collections listed there! Also, it’ll be easier for beginners to buy, sell, and trade digital art pieces with popular crypto exchanges since most of them have loads of educational material.

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What are xNFTs?

Executable NFTs are a great example of how fast the crypto landscape can change. So, what is xNFT’s definition? It goes beyond traditional NFTs and contains executable code that allows them to perform various functions and tasks.

NFTs VS xNFTs

Traditional NFTs are static, valuable digital items that you can own.^[1] There are numerous NFT marketplaces, including crypto exchanges like Binance, where you can purchase NFTs as collectibles. It helps to diversify your portfolio and become a part of a lively NFT holder community!

Non-fungible tokens gained popularity in 2020 with many crypto enthusiasts claiming that these digital assets provide a public certificate of authenticity or other proof of ownership. Thus, NFTs like CryptoPunks and Bored Ape Yacht Club garnered public interest. Even celebrities were releasing their own digital art and engaging NFT communities for publicity.

People were interested in acquiring digital art and exploring the depths of Web3. NFT trading hit around $17 billion in 2021, a sharp increase from the previous year of $82 million. However, this hype was short-lived.

In 2022, the NFT market collapsed as speculations about investment validity and uncertainty about legitimate ownership arose. Some experts reported that 95% of NFT holders had worthless investments in their portfolios.

With growing disappointment in the NFT market, people were quick to abandon this investment strategy. That’s when Solana figured out a way to return NFTs to their foundation of being functional and usable. It redefined digital art and introduced executable NFTs, aiming to make non-fungible tokens interactive and valuable once again.

Solana released documentation for its xNFT framework, called React xNFT. This foundation enables developers to create their projects and contribute to the resurrection of NFT marketplaces.

Therefore, xNFTs introduced a new concept, executable code, to this side of the crypto world. Such code allows the NFT to interact, communicate with other digital assets, and even change state based on some conditions. So, executable NFTs expand the traditional definition of digital collectibles and allow a wide range of use cases.

The Technology Behind xNFTs

Executable NFTs combine several key blockchain innovations: smart contracts, dApp features, and decentralized storage solutions. So, these features enable what is xNFT's dynamic and interactive approach. However, the development of xNFTs is complex, so Backpack provides extensive documentation to help you navigate it.

Firstly, the main technological aspect of executable NFTs includes Solana. As xNFTs are exclusively built on this blockchain, you can enjoy high throughput, low latency, and cheap transactions that are relevant when discussing Solana.

This blockchain is known for its speed. For example, at the moment of writing, Solana processes about 65,000 transactions per second (TPS). It’s one of the fastest transaction processing systems in the market!

Another crucial technological component of xNFTs is smart contracts. It’s a self-executing contract that has the transaction processing terms written in its code.^[2] When considering executable NFTs, this code is embedded into the NFT and can execute certain functions. So, smart contracts allow xNFTs to work in the way developers intend.

Also, smart contracts on Solana include robust security measures that extend to xNFTs. These measures include mechanisms for preventing exploits, code audits, verification processes, and more. The Solana blockchain continuously improves its safety practices, so you can rest assured that the integrity of xNFTs remains intact.

Moreover, integration with decentralized applications (dApps) is another element behind the technology of xNFTs. It helps to extend the interoperability of executable NFTs since they can interact with dApps. So, the state of xNFTs can change because dApps can read, trigger, and modify them based on the users’ actions!

xNFT Craze: The Case of Mad Lads

Notably, one of the most well-known xNFTs is Mad Lads. It’s the first xNFT collection of Backpack, a Solana-based wallet with 10,000 digital assets featuring illustrated humans with different emotions, styles, and accessories. It includes colorful and recognizable avatars that crypto enthusiasts can buy, sell, and trade.

Developed by Coral, a framework development company on Solana, the Mad Lads collection received overwhelming attention. People were interested in the showcase of xNFT capabilities. However, the team had to delay the mint date due to increased traffic.

Nevertheless, the hype didn’t die down - people were actively participating in various forums and wanted to acquire their own Mad Lad. Thus, the community surrounding this collection is active and lively, so the attention around Mad Lads remains prevalent. The co-founder, Armani Ferrante, actively posts on social media, keeping the community engaged.

Launching these xNFTs was pivotal for Solana, as Mad Lads are credited for revitalizing Solana NFTs. The evolving avatars, interactive experiences, and a lively community position Mad Lads as one of the most well-known xNFTs in the market.

How Do xNFTs Work?

When learning what xNFT’s technology is, it’s important to note that xNFTs are exclusive to the Solana blockchain. They’re built using React xNFT, a specialized framework for this task. It allows native Web3 applications to run inside an isolated browser sandbox. Simply put, you’ll open Backpack and launch xNFTs without leaving the wallet window.

This browser sandbox ensures that illicit actors or malicious code can’t access data or resources stored on your device.

So, how do different xNFTs load inside the sandbox? Each of them has a unique program ID associated with their executable code. This program ID is an extension of the SPL tokens, Solana’s version of the ERC-20 standard, since xNFTs are minted as these SPL tokens.

When a user opens an xNFT, its program ID loads the code into the browser sandbox. After that, you can access all components and use them fully. Different xNFTs can also communicate through events or messages - for example, your game could instruct the music player to start a specific song,

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What is Backpack, the Solana-based Wallet?

If you want to keep your xNFTs secure, your best bet is Backpack, a wallet built for Solana-based assets. Backpack stores your private keys locally on your device while the xNFTs themselves remain on-chain in decentralized storage, so you never rely on centralized custodians. It also supports traditional NFTs and SPL tokens, making it a true all-in-one wallet.

That said, Backpack is a mobile app for iOS and Android devices, making it convenient for trading on the go. You can also install it as a browser extension if you use Chrome or Firefox. Since xNFTs open in an isolated browser sandbox, using them on the computer is simple and easy to navigate.

Moreover, Backpack extended its functionality and became a crypto exchange. There, you can find the most popular cryptocurrencies with a sleek design common among trading platforms. However, if you’re looking for well-known crypto exchanges to start your journey, I recommend checking out Binance, Coinbase, or Kraken for every new crypto enthusiast!

What is Solana Mobile Stack?

When learning what xNFT’s concept is, you’ll come across tools for developers. The Solana Mobile Stack (SMS) is an open-source software development kit (SDK) that allows developers to launch their dApps and xNFTs on Solana. This SDK is tailored for native Android Web3 applications, as Solana aims to innovate the mobile niche of the Web3 world.

So, if you’re looking for pre-made tools to launch your own xNFT project, SMS offers a quick way to build it from scratch! You’ll find numerous resources to create an xNFT game, music player, or any digital asset with interactive elements. SMS fosters creativity and innovation so you can make your craziest ideas come to life.

There are protocols for connecting mobile apps to crypto wallets, robust security measures, and a decentralized payment system via SMS. Thus, you’ll find the essential tools to build a framework for your xNFT and customizable application details like buttons and images.

Whether you're building a simple game or a complex staking-rewards xNFT, you'll find everything on SMS. However, keep in mind that you need to understand the nuances of the Solana blockchain since your xNFT will be available only to traders on this platform.

Application of xNFTs

While people are still figuring out what is xNFT’s hype, developers are building exciting projects to expand the universe of executable NFTs. You can access and try a few types of applications for yourself. From games to DeFi services, you can launch it directly from your wallet.

Games

Solana’s xNFTs power various games, from simple tappers to exploring quests. Such a variety caters to gaming interests and groups, so everyone can find something they can play. Also, xNFTs can be used as game assets like characters or items. Simply navigate to the xNFT library on Solana and select the game you want to play!

For example, Moongame is an xNFT game that allows you to take your already-owned NFTs to space! It works like an arcade game where you need to control the spaceship, avoid asteroids, and find power-ups. Also, you can compete against other players for added fun.

Another example is Sporting F1, an F1 fantasy league that allows you to mint special car NFTs. You need to stake your virtual car on race weekends to play this xNFT game. Afterward, players can unstake them and immediately get rewards.

📚 Read More: Best Solana Games

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DeFi Services

Going back to the basics of what is xNFT’s main use case is, I need to mention its application for various DeFi services. You can stake, lend, and even borrow tokens on the Solana blockchain. By utilizing the technology of executable NFTs, you can easily do everything using Backpack and access such services in a separate browser window!

For example, Solend is an xNFT that allows you to lend and borrow cryptocurrencies on Solana. There are similar services in the crypto world. So, if you’re familiar with Aave or Compound, you’ll quickly understand how Solend works.

Also, you can find a crypto tracker called Birdeye on the xNFT gallery. It provides crucial information for every crypto enthusiast who wants to trade on Solana. Simply launch Birdeye and have it open on one of your screens to always look for trading information.

NFT Collections

If you’re looking for NFT collections, xNFT offers an interactive experience of getting your hands on interesting non-fungible tokens! Notably, the popularity of xNFTs skyrocketed with the introduction of Mad Lads, and the xNFT library features numerous collections for these digital assets.

Besides exclusive packs for the infamous Mad Lads, you’ll find Nokiamon, an NFT collection with pixelated blockchain monster art. Every art piece will have custom data regarding its name, type, first appearance, and more. Also, you can set the mood with background music and collect badges within this xNFT!

Moreover, you can find various NFT collection trackers to get notifications about new releases and other relevant information. There are swapping xNFTs where you can exchange your current NFTs for new ones. Also, you can create and explore personal NFT shops with xNFTs like Stache.

Benefits of xNFTs

The real power of xNFTs in Web3 lies in their versatility. Beyond being interactive digital art, they serve as a platform for a range of use-cases, from immersive games to DeFi tools such as lending and borrowing. In short, xNFTs open the door to multiple forms of adoption and utility, some of which are:

• Versatility.
• Adaptability.
• Interactive elements.

Developers can create various projects since xNFTs are built on Solana using the React xNFT framework. Whether it’s a music player, a cryptocurrency tracker, or a complex game, you can adapt and transform your xNFT to fit your dream.

The key feature of such digital art pieces is interactive elements. While regular NFTs are static images, xNFTs have buttons, sidebars, or other ways for you to interact with them. Such features are engaging and attention-grabbing, persuading users to keep coming back!

Challenges of xNFTs

Despite the benefits, executable NFTs have some drawbacks. When considering what is xNFT’s main limitation, many crypto traders will point out its exclusivity to the Solana blockchain. With the rise of interoperability, this is disadvantageous for the wider adoption of xNFTs across different blockchain platforms.

Also, the crypto world is booming with daily innovations, so the creators of xNFTs need to put extra effort into educating potential users about their creations. The concept of executable NFTs is relatively new, so it might prove to be a lot of work!

Moreover, technical complexities can be challenging for developers who want to create new xNFTs quickly. Solana provides some documentation about the processes and implementation methods. However, since xNFTs need embedded executable code, some developers can struggle with making it work inside the NFT.

Popular NFT Marketplaces

During the 2020-2021 NFT craze, there were some prominent marketplaces dedicated to digital art trading. While you possibly won’t find what is xNFT’s example is on there, you can browse through the galleries and get acquainted with popular NFTs. There’s always a possibility that these marketplaces will adopt xNFTs in the future!

OpenSea

One of the most well-known NFT marketplaces is OpenSea. It holds the title for being the largest and oldest in the market and operates primarily on Ethereum. You can buy, sell, and trade various NFTs, digital art, collectibles, and domain names. Moreover, you can create your own NFT and list it on this marketplace.

OpenSea has a wide variety of NFTs. Since it’s one of the oldest NFT marketplaces, it’s home to numerous famous collections like Bored Ape Yacht Club. Also, you can find digital art, music, trading cards, and other digital assets on OpenSea.

Moreover, users can enjoy a smooth experience with an intuitive interface that’s easy to navigate. Besides being user-friendly, OpenSea has integrated with Polygon, which is a Layer-2 solution for Ethereum. Thus, you’ll enjoy gas-free transactions and only pay the costs associated with trading NFTs!

Ensuring a fair marketplace, OpenSea allows creators to set royalties. It enables people to earn a percentage of each trade regarding their NFT. Fair compensation for creators has been a hotly debated topic when discussing digital art, so many people praised OpenSea for taking this step.

When it comes to the possible integration of xNFTs, OpenSea could greatly benefit from this expansion. New and interactive executable NFTs can boost this marketplace’s user engagement and increase overall trading volume.

Rarible

Another well-known NFT marketplace is Rarible. It operates on the Ethereum blockchain and has its own governance token to foster decentralization. You can buy, sell, and create digital art, collectibles, and other NFTs on this platform.

Its decentralization and community governance prove to be a significant advantage. By promoting transparency and trustworthiness, Rarible fosters a lively community and engages people to vote on important matters.

Moreover, there are multiple tools for creators that make the process of creating and listing your NFT quick and seamless. Rarible supports easy minting of NFTs, so you can start earning from your creations without deep technical knowledge.

Similarly to OpenSea, Rarible allows you to set royalties. However, you can set the royalties up to 50% on Rarible, which is a lot more compared to other NFT marketplaces. It supports its creators in multiple ways and emphasizes fair compensation.

However, the adoption of xNFTs can prove challenging for this NFT marketplace. The community would need to vote on expanding Rarible to integrate with Solana. While it’s possible to do so, it’s important for the xNFT community to educate Rarible about the benefits of integrating executable NFTs and their interactive elements.

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Foundation

If you’re looking for a unique NFT marketplace, Foundation might be the perfect place. It’s an invite-only platform that features only high-quality NFTs, collectibles, and other digital art. Exclusive content from well-known creators draws people to explore this NFT marketplace and secure an invite.

The Foundation sells non-fungible tokens in an auction, so you’ll need to place bids alongside other potential buyers. The highest bidder wins and purchases the NFT. This unique concept expands the Web3 landscape and introduces an exciting element to traditional NFT transactions.

Furthermore, artists on the Foundation have more control over their work. From setting the starting price to overseeing the auction, artists are involved every step of the way. They can get significant royalties from each purchase of their digital art, so this NFT marketplace fosters artist-centricity.

Also, Foundation could benefit from integrating what xNFT’s concept is into its marketplace. Bringing interactive elements and expanded functionalities to the auctions can attract more engagement from users. Moreover, it would enable a dynamic artistic approach to digital art and highlight creators as versatile artists.

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Conclusions

You need to know two things when considering what xNFT’s concept is. Firstly, xNFTs are executable NFTs with code written into the digital art piece. Secondly, their application covers various use cases, from xNFT games to DeFi services. Once you understand these basics, you’re ready to take on the world of executable NFTs!

However, xNFTs are exclusive to the Solana blockchain. So, if you want to get into NFT trading, you'll need a specific exchange that supports the aforementioned blockchain. That said, you’ll find numerous NFT collections on marketplaces and experience easy onboarding to the world of digital art.

The content published on this website is not aimed to give any kind of financial, investment, trading, or any other form of advice. BitDegree.org does not endorse or suggest you to buy, sell or hold any kind of cryptocurrency. Before making financial investment decisions, do consult your financial advisor.

Scientific References

1. Poposki Z.: 'Crypto-aesthetics: towards a New Materialist theory of NFT art';

2. Wang Q., Li R., Wang Q., Chen S.: 'Non-Fungible Token (NFT): Overview, Evaluation, Opportunities and Challenges'.