Non-fungible tokens on Stellar

dzham

This is something I've had on my mind for quite a while, and after finishing up my entry for SBC I decided to wrap this thing up.

If you've happened to miss the CryptoKitties craze, NFTs are a way of representing classes of uniquely distinguishable items, like, uhmmm, cryptographic collectible cards w/ kittens.

Other examples could be land titles, cars, houses, in-game assets, etc...

stellar-nft uses Stellar accounts to represent its tokens.

The metadata that uniquely defines a token is digitally signed by the issuer before being stored as an IPFS object.

The IPFS multi-hash, in turn, is used as the secret key for the account corresponding to a token.

An account uses its homedomain as a means of specifying its token class, and as a way to lookup the public key used to verify its authenticity, and (optionally) as a way of finding the multi-hash of the IPFS object that houses its metadata.

Ownership of a token is represented by signing rights.

NB: Because tokens are implemented as accounts, they are not tradable on the Stellar DEX.

Since stellar-nft tokens are implemented using Stellar accounts, they fall under the same minimum account balance requirements as regular accounts.

2 base reserves fees - the account itself
1 base reserve fee - the additional signer representing the owner
1 base reserve fee - as a buffer for one extra signer when transferring ownership (new signer has to be added before old signer is removed)

Currently that amounts to 2.0 XLM.

An extra base reserve fee would be added if/when a data entry is used instead of reverse federation.

Issuing NFTs:

https://github.com/future-tense/stellar-nft-issuer

Interacting with NFTs:

https://github.com/future-tense/stellar-nft

istrau2

Very cool! Going to go over in more detail this week.

kirbyrawr

Looks really interesting, good job.
Edit: I think it could be interesting for hold items of games in the blockchain.

TidesNetwork

Non-fungible tokens are an essential part of the crypto ecosystem. If stellar can get non-fungibles on its network, that would be a huge use-case for Stellar.

steveklebanoff

Awesome work! Creative solution.

Only bummer is lack of being able to use the Stellar DEX to trade these. Any ideas for a decentralized marketplace for these NFTs?

dzham

steveklebanoff Any ideas for a decentralized marketplace for these NFTs?

Definitely!

Jem

Very, very nice.

To be clear, this means 2 XLM per non-fungible thing (e.g. per crypto kitty), right?

dzham

Jem To be clear, this means 2 XLM per non-fungible thing (e.g. per crypto kitty), right?

Currently it's 2 XLM.

There might be ways to get it down to 1.5 with some tweaking of the mechanics of ownership transfers.

It's important to remember that it's a deposit that will get refunded when the item is destroyed.

ConnorMac

Having a look into this myself. Wondering the reasoning for not creating a lowest denomination asset to represent the NFT. This would allow it to be more easily trade able but less easy to establish the current owner. Did a rudimentary implementation here: https://github.com/ConnorMac/stellar-non-fungible-factory . I also store the IPFS hash on the original Issuer accounts data section as opposed to relying on a Federation server.

kirbyrawr

ConnorMac But still this doesn't solve the problem of the base reserve, i think it's one of the biggest issue regarding this.

Correct me if i'm wrong please and also i'm interested on this, i did a basic example in Unity but it needs trustlines for each item and that can be a pain for both users and network.

https://galactictalk.org/d/1517-stellar-items-framework-unity-3d

dzham

ConnorMac

A DEX is much more useful when you have an actual two-sided market. One-offs like NFTs only have one seller, and you'd probably want something like an auction take place instead.

Lowest denomination assets can be done, but are a bit of a kludge, since no other app will understand that your amounts are 10,000,000x too low.

Account data entries are mutable. You might end up buying a pig in a poke.

ConnorMac

kirbyrawr No my implementation does not solve the base reserve unfortunately. Although those could be considered "fees" in a sense. You could make the user of a service pay(for example) the base fees(this being the amount needed to setup the token) to another account then check that and mint the new tokens on a fresh issuer.

I imagine in the games context it could create all the trustlines under the hood? Only in the case were the game client has access to some kind of private key though.

ConnorMac

dzham The account data is mutable but since the account is locked on creation (Master signing key is set to 0 weight) it is a good as permanent, unless I'm missing something.

In the token metadata on the account (or in a federation toml file) we could set up with a standard that tells wallets how to correctly handle an NFT.

Cajga

@ConnorMac how are you going to "sell" the NFT after you have locked the account (means no key/keys has enough weight to sign a transaction)?

ConnorMac

Cajga Part of the creation process is sending the initial amount to an initial owner before locking. The same way you can guarantee a limited supply when creating any other kind of asset/token.

PeterJohnson

Great explanation, and I am glad to see NFT use being made possible on Stellar. As we work towards financial inclusion globally, ownership of assets, rather physical assets like land or digital assets will become more and more important to make accessible to those outside of the financial system.

Maffei

Looks highly promising, albeit a few immediate questions come to mind:

What is the step-by-step process for both sides of the transfer (i.e. a seller transfering an account-based NFT to a buyer in a trustless manner via Stellar Laboratory or even better - Rabet, Albedo or Freighter)?
Does the secret key of the NFT itself essentially become irrelevant (i.e. the secret key of the public key that possesses the NFT is all that matters)?
Can this type of NFT be created without any code involved (i.e. directly via Stellar Laboratory), and can you point to a tutorial or provide a simple explainer if so?

If all of the above is 100% doable without any external code whatsoever involved, I am salivating at the prospect of creating and experimenting with this brilliant type of NFT via Testnet.ai.