ERC-6551: The Next Trend for NFTs

ERC-6551: The Future of NFTs

What is ERC-6551

ERC-6551 allows each NFT on Ethereum to have its own wallet, and many people do not understand what this means.

Simply put, users can now not only connect their wallets, but also connect their NFTs.

What are the benefits of unlocking this feature? Let’s use an example to illustrate.

Suppose you now own a Mutant NFT and, through this NFT, collect some items in the game while also holding ApeCoin tokens.

Using ERC-6551, all collected items and tokens can now be bound to the Mutant NFT itself, rather than being bound to your wallet.

Although it is only a change of binding target, this was previously impossible.

NFT upgrade and decentralized messaging

Imagine joining a DAO organization. As an active participant in this organization, all the rewards you receive, such as POAP or SBT, can all exist in your DAO membership card.

The DAO membership card itself is an NFT, and your continued participation and contribution will make your NFT more valuable, that is, upgrading our NFT without changing the NFT metadata.

You can also add any NFT or ERC-20 token to your PFP account and then connect this PFP to AI to help you with transactions.

You can also send messages directly to PFP without knowing the user’s Twitter account. ERC-6551 allows project integration of decentralized messaging.

NFT history and loans

At the same time, your PFP can now display transaction history, such as whether your Doodle has been used as collateral for a loan, whether you have received an airdrop, or whether it has been held by a celebrity, etc.

When the NFT itself has a wallet, its transaction history will never be lost.

ERC-6551 can also reduce loan risks. Suppose you use a Mutant worth 10 ETH as collateral to borrow 5 ETH. When the Mutant floor price falls, you can send additional ETH to the Mutant itself to prevent liquidation.

NFT Combinations and Non-Fungibility

The adoption of ERC-6551 will make your NFT even more unique, greatly increasing its non-fungibility.

The first real example is Jeff Staple’s Sapienz.

You can send Jeff’s different NFTs to Sapienz’s wallet, just like dressing up existing NFTs.

The original NFT will combine with the new NFT to produce different styles and backgrounds, making your NFT look even more unique, and this feature is already available on Opensea.

Current limitations

ERC-6551 is still a very new protocol, and users may not be willing to use this protocol on some expensive NFTs until it has undergone more testing.

ERC-6551, which is in the experimental stage, may still take several months to develop many features.

ERC-6551 is the next innovation for NFTs and a big step towards turning PFP into on-chain identity. It will allow NFTs to record their own history independently, rather than relying on wallets to record them.

This opens up more possibilities for NFT trading, more applications in games, traceability, governance, and more.