Compressed NFT Meaning

Jul 8, 2024 | Updated Jul 8, 2024

A compressed NFT is a type of non-fungible token on the Solana network that condenses the token’s metadata and media files to reduce the storage space required on-chain.

What Is Compressed NFT?

Conventional non-fungible tokens (NFTs) often issue and store everything on the blockchain, which makes minting and distribution of these digital assets costly. Compressed NFT, on the other hand, provide developers with a more efficient and cost-effective way of creating and distributing NFTs. But what are they?

Solana Labs and Metaplex created this new standard to enhance scalability and optimize the storage of NFTs within the Solana ecosystem. Compressed NFTs (cNFTs) are possible thanks to an NFT standard on the Solana blockchain that shrinks an NFT’s metadata and related media files into a compact “hash” using Merkle trees.

Unlike ordinary NFTs, in cNFTs, the Merkle root is stored on-chain and the Merkle leaves are stored off-chain. This helps conserve on-chain storage space while keeping all of the cNFT data subject to network consensus.

How Can Compressed NFTs Be Used?

cNFTs typically allow developers to mint NFTs on a large scale since holding data off-chain significantly reduces the cost of renting storage space. Some of the novel standard’s use cases include:

Digital art – cNFTs allow artists and developers to create artwork without worrying about prohibitive costs.
Gaming – cNFTs can serve as in-game assets such as virtual land, avatars, and character skins, in blockchain games.
Music and events – These special NFTs can also serve as digital collectibles for event-goers, saving ticketing companies money while leveraging the blockchain’s robust security to help keep users’ purchases safe and opening the door for blockchain-assisted secondary ticket markets. .
Metaverse and virtual reality (VR) experiences – cNFTs can represent digital assets within VR and metaverse platforms, allowing brands to provide digital collectibles that improve user experience.
Enterprise-level systems – cNFTs are ideal for facilitating public records digitization and merchandise tracking, allowing large organizations to create, store, and retrieve NFTs on a large scale at a fraction of the cost of conventional NFTs.