Major improvements are needed in the image-hosting part of nonfungible tokens. People first saw NFTs on FTX break down after it declared bankruptcy. NFTs on Magic Eden, a marketplace for NFTs, showed questionable images as well as their thumbnails.
Cointelegraph reached to industry executives to hear their views about how NFT projects could solve the NFT host problem.
Diverse executives in the NFT industry shared their opinions on how to avoid future problems with NFT image hosting, from the use of reliable blockchains to the exploration of the Web3 storage technology.
Samuel Huber is the CEO of LandVault’s metaverse platform. He noted that the issue in FTX NFTs stemmed from the fact that metadata was stored using a Web2 interface. Huber believes that NFT projects should use reliable blockchains to store NFTs and not be controlled by any single entity.
This is an important lesson, but collections still host metadata on AWS.
— jac0xb.sol (@jacobdotsol) December 7, 2022
Cointelegraph was also informed by the executive that, while very few projects currently host images on-chain at the moment, it is important to ensure that metadata and files are properly hosted. He also said that:
“Projects should verify if the platforms are using decentralized hosting providers such as IPFS and Airweave for the metadata and any other files that are linked to the NFT.”
Alex Altgausen is the CEO of NFT-gaming game Banksters. He believes that NFT projects should explore storage technologies available in the Web3 space, if they really want to disrupt traditional industries like gaming.
Altgausen told Cointelegraph that there are new technologies that “distribute file storage using multiple decentralized options.” These allow computers worldwide to store and serve files in a peer-to-peer network, and this removes the dependency on traditional Web2 storage providers like Amazon Web Services or Google Cloud.
Related: Magic Eden will refund victims of exploited NFTs
Users may find it difficult to determine if the NFTs they have purchased may be affected. Radek Pléha, the co-founder of NFT ticket platform BillionAir, told Cointelegraph that users will have to do their own due diligence and research the project’s storage infrastructure to make sure that this doesn’t happen to their NFTs. “This can include reviewing the project’s whitepaper and checking for any security measures that have been implemented, as well as looking for reviews and feedback,” he added. Pléha also said:
“Unfortunately, not all NFTs metadata are stored on the blockchain, as main chains may be limited in size and more expensive for data storage.”
On Aug 5, Jonathan Victor, the Web3 storage lead at Protocol Labs and Rarible CEO Alex Salnikov also discussed how NFTs don’t live on the blockchain. Victor noted that due to the limitations of main chains’ size, NFTs can only use off-chain storage solutions. He also stressed the need for decentralized storage networks to store NFT metadata. Salnikov, on the other hand, stated that NFT transactions are verified on the blockchain, but that NFT metadata is generally stored somewhere else.