Some of our collectors with more technical soul, asked us why we had chosen to configure Bitmonds digital collectibles as a Smart Contract, rather than as Non Fungible Tokens (NFT).
For those who don’t know, these are two different methods of using Blockchain.
So we decided to share the reasons for a choice made since Bitmonds was just an idea on paper. And which we still consider the right intuition.
As it represents the most flexible solution, in a Blockchain scenario that is still seeing great change, such as the one we talked about in the previous article dedicated to migration to EOS.IO
We will try to provide as many elements as possible, using as little technical language as possible, to make reading pleasant for all our collectors.
Let’s go. How? Speaking precisely of our audience.
Vanilla Rocket’s Vision in the foundations of Bitmonds project
Bitmonds represents the first element of a broader picture of Vanilla Rocket startup, aimed at the full diffusion of Blockchain technology.
The historical moment in which the company and the idea of the project were born is 2018, the year following the boom of ICOs (Initial Coin Offering). Tools with which startups obtained liquidity in exchange for issuing new crypto-coins.
A valid tool in theory, because it creates direct contact between the company and investors. The problem is that many of these turned out to be fraudulent activities, leading in those months to a great distrust of ICO model, crypto-coins and Blockchain itself (mistakenly linked to the previous two).
Vanilla Rocket was born with the Vision of introducing the advantages of Blockchain technology into the life of the greatest number of people, without asking for experience in crypto-coins or even knowing them.
A concept that our CEO mentioned in a Startup Magazine article in January 2019, the month of launch of the Bitmonds project:
“With Bitmonds.com project we aim to introduce two elements of innovation. First of all, the concept of Digital Luxury Item. It will be normal to wear a Bitmonds on a smartwatch or why not on dedicated devices, like a jewel. Then we intend to demonstrate that Blockchain is not just crypto-coins … .. This “hybrid” model Blockchain + physical currencies, we believe will allow the public to get closer to the sector, exactly as is happening in the car market with hybrids, a necessary path in medium term to get to electric cars for everyone ”
The Bitmonds project starts from this point and further extends its catchment area, with the concept of a collectible to be worn in everyday life and not to be hidden in a glass showcase, to express a passion or the mood of one’s day.
Those of you who love Blockchain technology will understand that only a diffusion within everyone’s reach can make the model truly universal.
The concept of decentralization in NFTs and Smart Contracts
As we mentioned earlier, there are mainly two usable models: NFT and Smart Contract.
Trying to stay on simple concepts, an NFT is a token, an object on the Blockchain such as crypto-coins. But unlike these, it is not interchangeable with another similar one. Two coins of the same value would be perfectly identical to each other. Instead, each NFT represents a unique asset.
Smart Contracts are software programs, operating on the nodes of the Blockchain, which allow actions to be taken when certain conditions occur. Their application has been hypothesized in many sectors, including insurance and real estate. They allow you to write data in a certified and secure way, such as the generation of a new Bitmonds with certain characteristics, its id number and owner data.
There is no greater or lesser decentralization between the two models, as this “quality” is provided by Blockhcain and not by the tool used. A distributed database, with identical copies on thousands of network nodes. Decentralized indeed.
Even the Non-Fungibility (uniqueness) is equally achieved by operating on a Smart Contract.
Would there be any doubts that the deed of sale of a car, recorded on a Smart Contract, would refer to a specific model and not to a model identical in features? No.
In the data written on the Blockchain, a decentralized database in thousands of copies, there cannot be two Bitmonds with the same number id or detailed characteristics.
But if a company goes bankrupt, does an NFT stay alive and a Smart Contract dies?
Not exactly. Unfortunately, if a company in the sector closes, a line of code remains in both cases.
We always want to be very transparent.
It is true that, technically, an NFT could be made “physical” on special supports and exchanged without the need for a company behind it, but the reality is that most NFTs at the time of creation ask for a link containing the asset graphics.
This is usually posted on a server. If a company goes bankrupt, it is supposed to stop paying for the hosting service and the graphic structure of an NFT disappears.
This theme is present above all in those NFT projects that leave autonomy to their collectors in defining the graphics of a digital asset, to check that no objects are created that could represent an insult of gender, race or religion.
The real risk, in the event of a bankruptcy of the sponsoring company, is the same between the two models.
If there was also a decentralization of the graphic elements, how many of you really believe that a project could survive, without a company to feed its marketing or for example by entering into agreements with new football teams to be included on digital cards?
Can I sell only using the centralized Showcase and take advantage of the advertising that you can do?
In reality it is quite the opposite. We admit that perhaps we have been too unclear about the real potential of what we have created.
Showcase on the Bitmonds website is just one of the tools available. We have structured the account of each collector, so that you could share the URL of your My Bitmonds section (showing those currently on sale), in order to unleash the strongest communication weapon in existence. You collectors.
Your imagination and spirit of initiative in sharing your Bitmonds showcase everywhere or integrating it into other tools that you can create. This would allow Bitmonds to reach every corner of the world.
How many of you know that Ebay has created the Crypto & Virtual Collectibles section?
Why not put the Bitmonds for sale and take advantage of all Ebay options (such as Auction, Buy It Now, Agile Payments or User Feedback)? Closed sales on Ebay could be handled like the sale of any other physical collectible. After closing and payment, the Bitmonds could be safely “shipped” by the seller through the normal functions of the Bitmonds portal. It is just an example of what we meant in the previous lines.
We observe daily NFT sales trends on dedicated portals such as OpenSea, typically visited only by blockchain industry experts.
The number of transactions, compared to the amount of projects present is really low.
Why limit yourself to these tools, dedicated only to those who have knowledge of terms such as wallet, metamask, crypto-coins, instead of using others dedicated to a real mass audience?
We’ve also seen too many projects, Cryptokitties clones, appear on that portal, experience a brief Hype moment and then quickly die. In part reminding us the experience of the ICOs.
This thing worries us, due to the negative effects it could have on the entire digital collecting sector. This is also why we like to be a technologically unique case, but also not to be included in an endless list of projects.
But in this way we lose visibility opportunities and increase transactions?
Let’s talk about real data recorded on OpenSea at the time of writing this article:
- Gods Unchained – $ 15 million raised at launch, 13,793 Ethereum transacted so far, but only 60,68 in the last 7 days.
- Cryptokitties – $ 12 million raised from Ben Horowitz’s fund, 63412 Ethreuem transacted so far, but only 382 in the last 7 days
- Sorare – $ 4 million raised by e.ventures, 8850 Ethereum transacted to date, of which 470 in the last 7 days.
- F1 Delta Time – the famous digital F1 car sold for $ 110,000 we talked about in this article, 2,280 Ethereum transacted in total and only 59 in the last 7 days.
Even in a historical period of global economic crisis, there do not seem exactly numbers to make your head spin, especially when compared to the enormous amount of resources that these projects have collected so far. They seem to us very similar paths, with an already written ending.
It is right to complete the picture with themes related to the lack of KYC and compliance with AML regulations, which NFT-based projects often tend to forget, which is very dangerous for companies based in Europe. It is up to you to identify who we refer to.
We recommend evaluating the proposals on the market from every point of view.
Our proposal is clear. Aiming for a market that is larger than the expert crypto niche, a real mass market that sees in Bitmonds not only yet another digital collectible on Blockchain, but also for the entire surrounding world that we are creating (Wearability Fashion, Loyalty Program …).
How can I have guarantees of success?
Sorry, but there aren’t any. NFT and Smart Contract are on the same level.
We like to always be clear and transparent like no one else would be. That’s how we are.
NFT is also a choice that makes the increase in transaction costs of a digital collectible fall on the end user. In the past few months we have paid up to $ 12 in Ether for transaction records.
All of this was transparent to Bitmonds collectors. Not for those in NFT projects.
Even in this, we have remained faithful to our corporate Vision: Blockchain for all in a transparent way.
Therefore, the only possible guarantee is to join the Vision of a company and a project in its entirety. In our case it has been declared and unchanged since the first interviews released.
We like to think that we are marathon runners and not sprinters.
We want to complete everything we have in mind over time.
Although 2020 represents a marathon for all companies with the addition of very high obstacles. 🙂
Closing. We do not exclude that in the future the Bitmonds project may turn into an NFT.
At the moment our solution gives the same guarantees in terms of decentralization and security, but greater flexibility in case of migration, up to a settlement of the Blockchain scenario.
If you liked this article, share it! Thus helping us to explain to the world what we are doing!