NFT marketplace Magic Eden believes that lowering the costs in NFT production creates an „easy access point” for new users to try NFTs.
Nonfungible token (NFT) marketplace Magic Eden has announced that it will support Solana’s compressed NFTs (cNFTs) to provide a cost-efficient and scalable alternative to owning digital collectibles.
Today we’re releasing support for cNFTs (find them in our popular collections)
cNFTs are a new wave of NFT creation only possible on Solana. The „c” stands for compressed (not Cardano don’t worry) which allows them to be produced at a fraction of the cost of traditional… pic.twitter.com/WbO4qqWLEt
— Magic Eden (@MagicEden) September 14, 2023
cNFTs are different from the usual Solana NFTs because their data are compressed and are stored off-chain. Because of this, production in larger quantities is more feasible as they require lesser fees to mint.
According to Magic Eden, this type of NFT is ideal for the creation of mass-produced collections in various industries like gaming, music, events and the metaverse. The NFT marketplace believes that it allows creators to reach wider audiences without spending more.
The NFT marketplace also believes that by lowering the costs involved in NFT production, it can potentially promote adoption and become an „easy access point” for new people to try out collecting NFTs. With lower costs, users can collect NFTs without risking a large amount of funds to acquire collections. It lowers the risk of losing money over NFTs.
cNFTs are powered by Solana’s state compression, a feature that allows as many as 1 million NFTs to be minted with just around $110. Compared to minting NFTs on Ethereum which could cost anywhere from $2.9 to over $30 to mint per NFT, the cost of minting is drastically lowered with cNFTs.
While there may be benefits to hosting NFTs off-chain, it also sometimes comes with challenges of its own. In 2022, NFTs that were minted on the crypto exchange FTX broke down and showed blank images as the exchange went bankrupt. An engineer pointed out that the NFTs were hosted using a Web2 API, instead of the blockchain and warned that there’s a lesson to be learned in hosting NFTs using Web2 technology.