Software engineer Jonty Wareing has made a startling discovery about the non-fungible tokens that have been making headlines recently: these NFTs are more centralized than we once thought. The solution to this problem is to reissue NFTs as fast as possible, before they become forgotten and worthless.
Since the beginning of 2021, NFTs have been blowing up, both in terms of mainstream media coverage and price action. They have achieved over half a billion dollars of trading volume in the past month, and some have been selling for prices in the millions of dollars.
As a result, many companies have popped up and have allowed users to create their own NFTs, such as Cent, Nifty, and Makerspace. These companies allow users to upload their own pictures, attach them to an NFT, then sell them. Though this sounds elegant and like a great way for people to join the NFT movement, it has a couple of flaws.
As pointed out by Wareing, these NFTs are dangerously centralized, and their life is directly tied to the existence of the company that minted it. Instead of the pictures being stored in a decentralized manner, they are instead stored on the website’s storage, meaning that if the website or company shuts down, the NFT image will be gone forever.
This has already started to happen. For example, TronDogs, the Crypto Kitties clone based on the Tron blockchain, shut down, and as a result all of their users permanently lost their assets.
The website checkmynft.com allows users to see if their NFT is stored directly on the blockchain or if it is stored in a Google Drive or Amazon account, which means it is destined to be deleted at some point.
Fortunately, all of these NFTs are not destined for failure. The websites that have been using insecure data storage methods can fix their problems before it is too late. For example, they can store the pictures and data directly onto the Ethereum blockchain, or by using a storage blockchain such as Arweave.
Even though Wareing is correct, and the already-issued NFT assets cannot be changed, the new and more robust NFTs could be sent to the owners of the current NFTs, which would solve the problem for the future. And, to prevent there being two NFTs, one that is future-proof and one that could break, the companies could break the old ones as soon as possible by deleting the image from their servers.
This would be incredibly expensive, and cause some controversy over the “originality” of NFT assets, but would ensure that the NFTs, some of which are worth millions of dollars, would not disappear overnight.
With the speed at which NFTs have gained popularity, it was inevitable that some companies would take advantage of the boon and use shortcuts to deliver a cheap product to their customers. Fortunately, this problem has been caught before it is too late, and NFTs still have the chance to achieve their goal of being a decentralized and permanently-available asset.
By Lincoln Murr