What is NFT? Detailed Explanation of Non-Fungible Token Standards, Metadata Storage, and Metaverse Application Scenarios

NFT (Non-Fungible Token) is a unique digital asset where each token has a unique identifier and metadata, making them non-interchangeable.

NFT vs FT (Fungible Tokens)

shell
Fungible Tokens (FT):          Non-Fungible Tokens (NFT):
┌─────────┐ ┌─────────┐        ┌─────────┐ ┌─────────┐
│ 1 ETH   │ =│ 1 ETH   │        │CryptoPunk│ ≠│Bored Ape│
│         │  │         │        │  #1234  │  │  #5678  │
│Fungible │  │Same value│       │ Unique  │  │ Unique  │
└─────────┘  └─────────┘        └─────────┘  └─────────┘

FT Examples: BTC, ETH, USDC    NFT Examples: Digital art, Game items, Domains

Feature	FT	NFT
Fungibility	Interchangeable	Non-interchangeable
Uniqueness	No distinction	Each is unique
Use Case	Currency, Payment	Collectibles, Identity, Credentials
Standard	ERC-20	ERC-721, ERC-1155

NFT Technical Standards

1. ERC-721 (Ethereum)

Characteristics: Each token is unique, suitable for unique assets.

solidity
// ERC-721 Core Interface
interface IERC721 {
    // Query balance
    function balanceOf(address owner) external view returns (uint256);
    
    // Query owner
    function ownerOf(uint256 tokenId) external view returns (address);
    
    // Transfer
    function transferFrom(address from, address to, uint256 tokenId) external;
    
    // Approve
    function approve(address to, uint256 tokenId) external;
    
    // Get metadata URI
    function tokenURI(uint256 tokenId) external view returns (string memory);
}

Data Structure:

solidity
mapping(uint256 => address) private _owners;      // tokenId → owner
mapping(address => uint256) private _balances;    // owner → balance
mapping(uint256 => address) private _tokenApprovals; // tokenId → approved

2. ERC-1155 (Multi-Token Standard)

Characteristics: One contract supports multiple token types (FT + NFT).

solidity
// ERC-1155 Core Interface
interface IERC1155 {
    // Query balance (supports multiple types)
    function balanceOf(address account, uint256 id) external view returns (uint256);
    
    // Batch transfer
    function safeBatchTransferFrom(
        address from,
        address to,
        uint256[] calldata ids,
        uint256[] calldata amounts,
        bytes calldata data
    ) external;
}

Use Cases:

Game items (various equipment)
Ticketing systems
Batch issuance

3. Standard Comparison

Standard	Token Type	Gas Efficiency	Use Case
ERC-20	Fungible	High	Currency, Points
ERC-721	Non-fungible	Medium	Unique artwork
ERC-1155	Hybrid	High	Gaming, Batch issuance

NFT Metadata Storage

Storage Solutions Comparison

shell
On-chain Storage:
┌─────────────────────────────────────┐
│ Contract stores metadata directly   │
│ • Name, description, attributes     │
│ • Image Base64 encoded              │
│                                     │
│ Pros: Permanent, fully decentralized│
│ Cons: Extremely high Gas costs      │
└─────────────────────────────────────┘

Off-chain Storage:
┌─────────────────────────────────────┐
│ On-chain stores URI pointing to     │
│ off-chain resources                 │
│                                     │
│ Option 1: Centralized Server        │
│   https://example.com/nft/1.json    │
│   ⚠️ Server down = NFT broken      │
│                                     │
│ Option 2: IPFS (Recommended)        │
│   ipfs://QmXxx.../1.json            │
│   ✅ Decentralized, content-addressed│
│                                     │
│ Option 3: Arweave                   │
│   Permanent storage, one-time fee   │
└─────────────────────────────────────┘

Metadata JSON Format

json
{
  "name": "CryptoPunk #1234",
  "description": "A unique CryptoPunk character",
  "image": "ipfs://QmXxx.../image.png",
  "attributes": [
    {
      "trait_type": "Type",
      "value": "Female"
    },
    {
      "trait_type": "Hair",
      "value": "Mohawk"
    },
    {
      "trait_type": "Accessories",
      "value": "Earring"
    }
  ]
}

NFT Minting Process

shell
NFT Minting Process:

1. Prepare metadata
   Create image + JSON metadata file
   ↓
2. Upload to IPFS
   Get content hash
   ↓
3. Call contract mint function
   mint(address to, string memory uri)
   ↓
4. Contract records
   • Auto-increment tokenId
   • Map owner
   • Store tokenURI
   ↓
5. Trigger Transfer event
   Queryable on blockchain explorer

NFT Applications in Metaverse

1. Digital Identity (Avatar)

shell
Metaverse Identity System:

┌─────────────────────────────────────┐
│         User Wallet Address         │
│         0x1234...abcd               │
└──────────────┬──────────────────────┘
               │
    ┌──────────┼──────────┐
    ↓          ↓          ↓
┌───────┐  ┌───────┐  ┌───────┐
│Avatar │  │Badge  │  │Achievement│
│ NFT   │  │ NFT   │  │ NFT   │
│       │  │       │  │       │
│ • Appearance│ • VIP │  │ • Level │
│ • Clothing│ • Identity│ │ • Skills│
└───────┘  └───────┘  └───────┘

2. Virtual Real Estate

Representative Projects: Decentraland, The Sandbox

shell
Virtual Real Estate Characteristics:
• Unique coordinates (x, y)
• Can build virtual structures
• Can host virtual events
• Can rent or sell
• Value depends on location and traffic

3. Game Assets

Play-to-Earn Model:

shell
Traditional Games:             Blockchain Games:
┌─────────┐                  ┌─────────┐
│Buy Skin │                  │Buy NFT  │
│Owned by │                  │True     │
│Company  │                  │Ownership│
│Cannot   │                  │Free to  │
│Transfer │                  │Trade    │
│Game     │                  │Cross-game│
│Shutdown │                  │Use      │
│= Asset  │                  │Permanent│
│Gone     │                  │Storage  │
└─────────┘                  └─────────┘

shell
Community NFT Membership System:

Level 1: Regular Member NFT
   ↓ Hold for 30 days
Level 2: Active Member NFT
   ↓ Participate in governance
Level 3: Core Contributor NFT
   ↓ Create proposals
Level 4: Governance Committee NFT

NFT Market Mechanisms

Trading Models

Model	Description	Representative Platform
Listing	Seller sets price, buyer purchases	OpenSea, Blur
Auction	English auction, Dutch auction	Foundation
Aggregator	Multi-platform price comparison	Gem, Genie
Royalties	Creator ongoing revenue	Standard 2.5-10%

Royalty Mechanism

solidity
// Royalty implementation example
function transferFrom(address from, address to, uint256 tokenId) public {
    // Calculate royalty
    uint256 royaltyAmount = salePrice * royaltyPercentage / 10000;
    
    // Transfer to creator
    payable(creator).transfer(royaltyAmount);
    
    // Transfer to seller
    payable(from).transfer(salePrice - royaltyAmount);
    
    // Transfer NFT ownership
    _transfer(from, to, tokenId);
}

NFT Development Trends

Dynamic NFT (dNFT): Metadata changes based on conditions
Soulbound Tokens (SBT): Non-transferable identity credentials
Fractionalized NFT: Split high-value NFTs into smaller pieces
Cross-chain NFT: Transfer between different blockchains

Interview Key Points

Understand fundamental differences between NFT and FT
Master differences between ERC-721 and ERC-1155
Understand various metadata storage solutions
Familiar with NFT minting process
Master NFT application scenarios in metaverse
Understand royalty mechanism implementation
Understand NFT market development trends