L2 x NFT : What is worth paying attention to about Immutable X?
Recently, more than 700,000 users participated in the public token sale of Immutable X on Coinlist to snap up 1 million $IMX (5% of the total). Why are users so crazy for the public sale of $IMX? From my point of views, one reason is the recent rebound in market conditions and the other is that NFT Summer not only inspires our enthusiasm for NFTs , but also makes us realize that costly Gas fees in Ethereum is preventing more people from interacting with NFT (investment, collection and trading). Meanwhile, for some investors who missed the NFT Summer and are expecting to Layer 2 Summer, Immutable X, the first Layer 2 (L2) solution of NFT on Ethereum, meets the investment needs of such investors .
Which aspects of Immutable X, with both concepts of L2 and NFT, do worth paying attention to? This article explains the necessity of Immutable X for the NFT industry, the technical principles involved in Immutable X , and the current ecosystem of Immutable X.
1) The necessity of Immutable X for the NFT industry
The concept of NFT began it popularity in the blockchain industry in 2017. Crypto collectibles called CryptoKitties initially deployed the ERC721 standard for NFT. It is also the existence of CryptoKitties that made the industry realizes that Ethereum needs to be expanded before its massive adoption. In 2018, blockchain games including Gods Unchained triggered industry to think about the “NFTization” of blockchain game items.
The existence of NFT, on one hand, allows everyone to truly own the property rights of virtual assets. On the other hand, it makes it easier for everyone to realize the transaction of these “unique” assets. However, with the rapid increase in on-chain activities, Gas fees often reaches to at leat hundreds of dollars, which prevents NFT, especially low-priced NFTs, from transaction. Thereby, it restricts the liquidity of NFTs. As results, Dapper Lab, the team behind CryptoKitties, chose to develop a public chain Flow for NFT field, while the team behind Gods Unchained chose to build Immutable X, an L2 solution for NFT, on Ethereum.
2) Features and technical principles of Immutable X
According to white paper, the security Immutable X is guarded by its Layer 1, Ethereum, but it provides users and developers with a better experience:
- Low cost: zero Gas fee and transaction fees can be set.
- Security: not a centralized sidechain; no custodial risk; users keep their private keys;
- Efficient: Massive scalability up to 9000+TPS.
The realization of the above performance mainly relies on the seven main functions of Immutable X: 1. ZK-Rollup scaling engine ensures the security of the Ethereum level, while meeting the needs of mainstream NFTs to mint, transfer and trade in fast and low-cost manner ; 2. API abstraction layer makes every interaction on Immutable X as simple as an API call; 3. AFT-enabled wallet allows users to, when experience NFT, to stay on the Ethereum network, by an intermediate layer (“link”), instead of switching networks ; 4. Platform SDKs currently allow developers to easily access Immutable X API and wallets, and will support various programming languages and such development platforms as Android, iOS, Unity and Unreal; 5. Shared liquidity and orderbook enable Immutable X to have more trading platforms; 6. Compliance support including copyright and AML/KYC makes it easier for large companies to enter the NFT field; 7. The default trading platform and transaction history explore allow users not to worry about no places to trade.
Overall, the zk-rollup scaling engine, developed by Immutable X and StarkWare, is the core of the project. After users lock assets in an on-chain smart contract to “deposit” the assets into L2 layer, assets are transferable on L2 layer. These transactions will be grouped by “operators”, and a proof of is generated for the validity. After the proof is published on-chain, it will be verified through a smart contract that updates the on-chain state . In addition, Immutable X uses STARK proofs instead of the more common SNARK proofs. Although the proof of former ones cost more to publish on-chain, the team believes it is more secure. This is because the SNARK proofs involve extremely complex cryptography and can be prone to implementation errors.
3) Immutable X ecosystem
OpenSea is undoubtedly the largest decentralized NFT marketplaces at present where tradable NFTs include art, music, domain names, virtual worlds, trading cards and collectibles. Until 2020, OpenSea had been only have a team of 7 people since its foundation at the end of 2017. The team only consists of 37staffs in 2021. Nevertheless, the marketing data achieved by OpenSea is staggering -the transaction volume in August 2021 reached US$3.057 billion, which exceeds the total volume of the past 4 years. According to Ultras Sound Money (https://ultrasound.money/), OpenSea has burned nearly 36,000 ETH since the launch of EIP-1559 on Ethereum (approximately 30 days+ latter ), accounting for approximately 12% of the total burned amount. High Gas fees reduce the possibility of low-priced NFT transactions. Therefore, in addition to Ethereum, OpenSea also integrates the NFT asset trading on Polygon as well as Klaytn , and will be on Immutable X in the future.
PolkaFantasy is a cross-chain NFT marketplaces and metaverse with the theme of Japanese ACG (animation, comic and game). It represents Japanese culture in the field of cryptocurrencies. As a cross-chain marketplaces, PolkaFantasy plans to integrate Ethereum, Polygon, BSC, Solana, Polkadot, Cardano and Immutable X. Its products include marketplaces and NFT wallets, but they are not yet online. The project token $XP conducted IDO on UniSwap on September 10, 2021.
Token Troves is an NFT marketplace integrating Immutable X, Polygon and Ethereum. The NFT collections are mainly NFTs from the ecosystem brands with Immutable X , such as Ember Sword Land, Gods Unchained Cards and Guild of Guardians. Other NFT collections include Parallel and Kolectiv.
Kinguin is an online video game marketplace with more than 10 million registered users and more than 50,000 tradable products. After several years of observation and analysis of the NFT industry, Kinguin’s CEO believes that it is a natural process for a digital to become an NFT platform. Therefore, Kinguin plans to launch a platform that allows users and partners to create unique NFT collectibles and trade. Partnership with Immutable X is one way to enable Kinguin to realize its plan.
Wilder World is a platform driven by immersive 3D NFT. It is dedicated to be the next version of “decentralized Marvel Studio”, which brings together the world’s top artists to create stories, characters, landscapes and environments. Although the product has not yet been launched, more than 250 encrypted artists and collectors have joined. The project announced a collaboration with Immutable X in May 2021 to make immersive 3D NFT transactions faster and cheaper. Currently,its token $WILD issued by the project is mainly used for governance.
Mintable is a platform for minting and trading NFT on Ethereum . Although there is no Gas fee for minting NFT on the platform, both trade of NFT or vote by $MINT token holders consume Gas cost. Therefore, the project decide to apply ImmutableX to ensure security while reducing transaction costs.
RTFKT is a wearable NFT fashion brand that applies technologies such as game engines, NFT, blockchain authentication and augmented reality to create a unique digital sneakers. What’s interesting is that certain types of shoes are available in both NFT and physical versions, allowing users to wear RTFKT sneakers both in the real world and virtual metaverse. The current floor price of RTFKT in OpenSea is as high as 8.5ETH.
Ecomi has two components, namely collect ecosystem VeVe and secure storage wallet. Currently, the collectibles on VeVe are more targeted at well-known IPs from the “conventional collector’s market”, such as DC characters . VeVe includes a store (primary market), a secondary trading market, an augmented reality showroom and social stream. The platform token $ECOMI is mainly used for platform transaction circulation.
GreenPark is a virtual sports world where fans can run a team (in NFT form) and compete with other players to earn points for continuous cost on the team. Epics GG is a website related to to e-sports trading cards. Users can collect NFT trading cards of their favorite e-sports teams, players and influencers, and purchase, trade or collect them.
Momentous is an NFT social minting platform on Ethereum and powered by Immutable X. The project is currently at an early stage and the product has not yet been launched.
Immutable X has reached a cooperation with game publisher Animoca. At present, its mobile gaming app GAMEE is also the partner with Immutable X. The GAMEE platform is developing an NFT system that will work with its gaming platform, and the $GAMME token will be used for purchase and upgrades NFTs. In addition to Animoca, Immutable X is also cooperating with Lucid Sight, a virtual reality game production studio that uses blockchain technology. Lucid Sight created at leat 15 games including MLB Champions, Crypto Space Commander and Cryptic Conjure. It is expected that the NFT assets of the games under Animoca and Lucid Sight can be minted, issued and traded on Immutable X.
Gods Unchained is a trading card game, a blockchain game version of Hearthstone. It is also one of the high-quality and first-known blockchain games in the early days. It shares the same team with Immutable X. The trading card are already implemented on Immutable X. Gods Unchained plans to issue 20 million $GODS tokens, which can be used to mint NFTs, purchase items in the Gods Unchained marketplaces, and govern. If users hold the tokens on Immutable X, they can get more rewards.
Guild of Guardians is an online fantasy action RPG mobile game. Players build their own team of “Guardians” and compete in guilds for huge and tradable rewards. Players can buy and trade heroes, pets and guardians at present, and it will be possible to mint NFT on Immutable X in the near future. Although the game is expected to go live in 2022, there are already more than 130,000 players waiting. Guild of Guardians plans to issue tokens $GOG, which will be used to mint game NFTs, purchase assets, governance , and stake for rewards.
Illuivium is an adventure RPG game where players can collect, trade, capture or fight for Illuvials , and obtain scarce in-game items. Currently, DeFi functions and NFT marketplaces are implemented, while the game is still in the demo stage. The internal beta version is expected to launch by the end of 2021. Its token $ILV is mainly used for governance. Illuivium’s DAO team has 70+ members, of which two founders are brothers of the founder of Synthetix . According to a series of Illuvial images and game demos regularly released by the official media, the game graphics seems exquisite.
MyCryptoHeroes is a multi-player RPG based on Ethereum and Polygon is also currently integrated. Players purchase historical hero NFTs to form different teams with each team of 3 heroes. Through quests, arenas, or battle with other players’ teams, players can upgrade heroes and obtain dropped items. Both heroes and other inventories can be traded through the official MCH World (no Gas fee), or NFT assets can be withdrawn to on-chain and sold through OpenSea. The project token $MCHC is mainly used for governance.
Crypto Assault is an online strategy military game with MMO component. Players purchase ERC721 NFT units to fight against different units in a 3D world in real time to capture territories , mine resources, and win ETH. The longer the unit is established and the more center area is occupied, the more reward there will be.
War Riders is a post-apocalyptic MMO driving game which advocate “Mine or Die”. Players can purchase vehicles, weapons as well as bundles, and drive through waypoints or plunder othere players’ assets to mine for $BZN. In the game item economics, players pay ETH for basic items such as vehicles,parts, basic guns, and garages, while pay $BZN for garage upgrades,nitro boosts, premium guns, and armor. The product is currently in the Alpha stage and available for Windows, Mac and Linux versions. The mobile version is planned to launch in late 2022.
Highrise is a virtual social mobile game, inspired by “The Sims” and “Second Life”. It is not yet a blockchain game now. In the virtual world of High Rise, users can create unique digital avatars and environments through thousands of clothes and furnishing pieces to construct their self-expression and fulfill social network needs.
NFT+DeFi is also one of the themes to promote NFT Summer. Currently, the partner of Immutable in the field of NFT + DeFi is only SuperFarm. Superfarm is an NFT platform that provides cross-chain mining, allowing users to mint NFTs and NFT pools without understanding the code. The $SUPER token issued by the platform is used for governance and is also a threshold for some platform services-at least 100,000 $SUPER tokens are required to activate the NFT pool.
For those who missed the NFT Summer, keep an eye on Immutable X and its ecosystem to explore chances before the massive outbreak of GameFi. Of course, this article does not constitute any investment advice, please do your own research carefully.