Overview
The hybrid on/off-chain NFT marketplace architecture that’s become prominent in the NFT space has its benefits and drawbacks. This architecture is complex and most often consists of several smart contracts that interact with each other and with off-chain components.
Generally speaking, these marketplaces require you, the user, to give them a signature by signing a message with your wallet and the signature is stored off-chain on centralized servers and used to authorize on-chain asset transfers on your behalf when a buyer buys your asset or when a seller accepts your offer for an asset.
This minimizes the number of transactions that require users to pay gas by allowing listings and offers to be made by simply signing a message with the connected wallet, but as we’ve witnessed time and time again this complex architecture is plagued by attack vectors and prone to regular downtime.
THE NFT.ORG DEX
The NFT.org DEX powered by NFT Protocol is an improvement to this model in terms of safety, security and availability because it allows offers, listings and trades to be submitted and executed 100% on-chain - i.e., without relying on user signatures stored off-chain or any other off-chain components - and collects zero user information.
NFT Protocol requires that users sign on-chain transactions which transfer the assets to the protocol in order to create listings or offers. Once in the protocol's contract, assets can only leave the contract if:
- 1.The swap is canceled by the address which created it. In this case the assets are returned to the address which created the swap.
- 2.The conditions for swap execution are met by a counterparty. In this case the assets are transferred to the counterparty and the specified assets from the counterparty are transferred to the swap creator.
NFT Protocol's smart contract has been audited by Peckshield. The contract's code and Peckshield’s audit report are available for public viewing.
Whereas the hybrid NFT marketplace architecture oftentimes leads to user behaviors that render them vulnerable to phishing and malware attacks, NFT Protocol and the NFT.org DEX bring users into a direct relationship with open-source, audited code. This eliminates all third-party risk and places the security of the system entirely into the hands of the user and the user's own private key security practices.
Furthermore, because NFT Protocol is 100% on-chain it is not subject to the sorts of censorship, user obstruction and downtime some hybrid marketplaces in the NFT space oftentimes demonstrate. If it’s on-chain it can be traded via NFT Protocol 100% of the time. The blockchain doesn’t discriminate nor does it sleep.
Supported Networks
- Ethereum
- Ropsten
- Polygon
One of the major issues facing the NFT space is the relative lack of liquidity available for NFTs. The multi-asset trading facilitated by NFT Protocol and the NFT.org DEX can improve the liquidity available for NFTs by allowing NFTs to be paired with more liquid NFTs and/or fungible asset types.
NFT Protocol and the NFT.org DEX allow complex and dynamic offers and listings to be made using any combination and quantity of supported asset types.
Supported Asset Types
- ETH
- ERC-20
- ERC-721
- ERC-1155
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