Since the introduction of the Colored Coins in 2012, the real-world assets existing on blockchains were introduced to the digital world. Later, the ‘token’ element was added to these assets and non-fungible tokens or NFTs were created.
NFTs are digital assets that represent real-world objects, including art, media, in-game items as well as properties and lands. In fact, NFTs make it possible to tokenize all real-world assets.
One of the primary benefits of NFTs is ‘proof of ownership’ of these digital assets. All data regarding NFT ownership is securely recorded on a blockchain that the developer has chosen to deploy their NFTs on. This made NFTs unique assets where not two of them are alike as each NFT has its own special characteristics.
In 2014, Kevin McCoy, the digital artist, minted the first-known NFT ‘Quantum’ on the Namecoin blockchain. This pixelated image got lots of attention and was followed by several successful NFT projects in the following years.
However, NFTs went mainstream mainly in 2021. There was a huge explosion and surge in NFT supply and demand during the year. Along with the hype in the NT world, blockchain technology also showed great progress to support the NFT market and allow the enormous amount of data on NFTs and their transactions. Therefore, some of the best blockchains were introduced to the market to satisfy the requirement of NFT traders and owners.
In this article, we aim to provide a list of the most popular Blockchains for NFTs. We also discuss their strength and weak points and explain why each of the blockchains is the most reliable to trade NFTs.
Top NFT blockchains
1. Ethereum (ETH), Top NFT bllockchain
The most popular blockchain for NFTs is Ethereum. In 2013, Vitalik Buterin, a Canadian developer, designed Ethereum as a new platform that allowed the decentralized applications for online transactions. Later in 2015, Ethereum was launched and 72 million ETH coins were minted. It included Smart Contracts and Dapps to provide greater blockchain possibilities.
Ethereum blockchain made it easy for NFTs to enter the mainstream with the ERC-721 NFT standard. ERC-721 has different properties and values such as accessibility of metadata associated with a token.
Ethereum also was the first to employ ERC-1155 multi-token standard. It allows tokens to behave not only as fungible ERC-20 tokens but also as non-fungible ERC-721 ones. The standards allow the decentralized functioning of the blockchain. Furthermore, this shows that Ethereum blockchain can adapt to market conditions.
Besides, Ethereum has managed to add huge infrastructure and developer tools and apps during the last two years. It ensures the accessibility of more apps and resources to both NFT developers and investors compared to its competitors.
Additionally, Ethereum also ranks high in terms of security. It is one of the most important features to be considered by NFT investors.
However, Ethereum blockchain is one of the most expensive choices in the NFT world. It asks for higher gas fees, especially when the demand for transactions is higher. Ethereum works using Proof-of-Work (PoW) mechanism that uses a lot of energy. PoW makes computers use lots of energy to solve complex puzzles and add blocks and transactions to the blockchain.
Considering its weakness, Ethereum has been the host to thousands of NFT collections such as Bored Ape Yacht Club and CryptoPunks. Besides, several successful NFT markets, such as OpenSea, make use of Ethereum blockchain to run their NFT transactions.
Solana has proven itself as the fastest programmable blockchain in the NFT world. It is defined as a public blockchain system that is highly decentralized and operates in an open-source manner. Solana takes the advantage of combining Proof-of-history (PoH) and Proof-of Work (PoW) consensus mechanisms to offer faster operations and lower gas fees.
Solana was founded by Anatoly Yakovenko in 2017. He developed proof-of-history technique to help eliminate the problems with scalability and time required to complete transaction orders.
At the time of writing, Solana is considered the second largest blockchain for NFTs due to the lower price of its native token SOL, compared to ETH. Note that Solana does not rely on miners to solve complex puzzles to complete transactions. As the result, it is more energy efficient and faster. These make Solana the best choice for those who look to buy their first NFTs.
Solana also is the house for some of the most successful NFT projects such as Degen Ape Academy, Okay Bears and SolPunks. Solana attracts lots of NFT developers and investors as it is one of the fastest DeFi networks. It is capable of processing around 2,700 transactions per second on average. The processing rate along with Solana’s hybrid consensus model offers lower validation time needed in transactions and smart contract execution. Therefore, the transaction fees significantly decrease and more people intend to choose Solana for their NFT trades.
Considering all the advantages Solana brings to the NFT market, it is still less popular among mainstream media and celebrities. One reason could be that DeFi is not a popularity contest and Solana’s protocol that is lower user based has mainly led the blockchain to be less favorable in NFT marketplaces and, accordingly, receive lower trading volume or liquidity compared to other NFT blockchains.
For another reason, Solana has experienced several occasional slowdowns and network outages in 2022. It is essential for NFT investors and developers to choose a network that is highly reliable so that it can avoid interferences with potential trades. Therefore, such outages can be a major concern to the Blockchain.
3. Binance Smart Chain (BSC)
Binance Chain, also known as BNB smart chain, was first launched by Binance in April 2022. Binance Smart Chain mainly focuses on facilitating fast, decentralized NFT trades. This blockchain runs in parallel to the BNB Beacon Chain; however, BSC boasts smart contracts functionality and compatibility with the Ethereum Virtual Machine (EVM). Being EVM-compatible, BSC launched with support for the rich universe of Ethereum tools and DApps so that NFT developers can not only transfer their projects from Ethereum to BSC but also use various tools and decentralized applications. Therefore, this makes it easy for developers to port their projects over from Ethereum.
BSC employs BEP-721 token standard in the smart contracts which allow NFT creation on the blockchain. Besides, the standard lets many Ethereum-based NFT developers use similar tooling on BSC with few changes.
Binance Smart Chain, operates using Proof-of-Staked Authority (PoSA) consensus model. It enables Ultra-fast trading with lower fees. Although very few popular NFT collections have been released on BSC at the time of writing, the trading volume for NFTs has increased considerably in 2022 which puts BSC among the highest volume chains for NFT trading.
However, since BSC is not adopted as an NFT platform, there has been little chance to turn it into one of the best blockchains. Few successful NFT collections released on BSC causes the blockchain to gain a small share of the market compared to Ethereum or Solana.
On the other hand, Binance Smart Chain is restricted to allow only 20 active validators working daily on the network. These validators are selected randomly by Binance Chain. As the result, a larger number of potential developers are put off. This also leads the market to get a smaller share of the NFT market.
As we mentioned, Ethereum currently dominates the NFT market followed by Solana blockchain. Some of the important factors which make these blockchains favorable to NFT developers and investors are gas fees and decentralization of the blockchains so that the rather high fees of Ethereum make it unfeasible for some smaller investors. Though, the wide range of tools Ethereum provides for its users helps it lead the market.
We suggest all developers and investors in the NFT landscape consider various aspects of a blockchain before choosing to use them with their NFTs.