NFT marketplace OpenSea introduced a new decentralized metadata feature this week, giving creators the ability to “freeze” their creations permanently. The new tool works for any NFT in a user’s collection, storing the data to IPFS. Once complete, the metadata is permanent and unchangeable, much like the NFTs themselves.
OpenSea’s interface also tells users the state of the metadata of any NFT they view. If it’s frozen, they will be able to visit the decentralized location of the information. While the benefits of this may not be immediately obvious, it’s an important step in fully decentralizing NFTs.
Why does metadata matter?
When you think of an NFT, you probably picture an image or movie or song, but in most cases, those are not actually part of the NFT itself. An NFT is, generally speaking, a record that those things exist, but not the things themselves. The image you purchase, along with its name, description and other properties, are often stored on regular file storage services.
Why is that a problem? Because if the server or service that hosts the files goes offline in the future, the bulk of the NFT — the thing you paid for — disappears. It’s like having a contract that says “I gift you the contents of the blue box”, but the blue box is missing. You have a promise that can’t be kept.
How does decentralization work?
NFTs work on the blockchain, which is founded on the idea of decentralization. In a nutshell, any bit of information added to the blockchain exists in many places at once. Let’s say you have a copy of my NFT contract on your hard drive, but your computer breaks. That’s OK, because thousands of other people have that same information at the same time. If everyone has the same data at the same time, it can never be truly lost.
NFTs work by storing smart contracts on the blockchain, but the data they talk about is usually kept elsewhere. There are decentralized storage solutions like the Interplanetary File System (IPFS) or Filecoin that store things like images, video and text across many computers at once, but they’re optional, and not widely used for NFTs.
What do OpenSea’s metadata moves mean?
By moving the metadata off of centralized servers and into distributed networks like IPFS, OpenSea is ensuring that the contents of NFTs survive, not just the contracts. They are helping keep the promise that the smart contract makes, that the owner of an NFT actually owns it.
Most people — NFT enthusiasts, too — mistakenly believe that their tokens have the same permanence as the blockchain itself. They own an image, so the image will always be theirs. But in most cases, that’s not the case. It may be unlikely that Google or Amazon will suddenly disappear one day, but it’s not impossible.
By making decentralized file storage a default in NFTs, they are making the technical reality match what people already believe: that NFTs are a legitimate, persistent way to create, trade and collect digital assets.
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This article is educational material.
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