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Meng Yan: the value of the Internet in the future is mainly built on NFT

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The future value Internet is mainly built on non-uniform token NFT. NFT is a better digital value carrier than FT and an inevitable trend of value Internet. The value Internet based on NFT still needs a lot of infrastructure innovation.

原文标题：《未来的价值互联网主要建立在 NFT 上丨 2021 世界区块链大会》

Original text author: Meng Yan

Source: Babbitt

On July 25th, "World Blockchain Conference 2021 · Hangzhou" was held in academic Exchange Center of Hangzhou Future Science and Technology City.

Meng Yan was honored to deliver a speech "NFT - the future of value Internet" at the conference. He believes that the future value Internet is mainly built on non-uniform token NFT, which is a better digital value carrier than FT and an inevitable trend of value Internet. The value Internet based on NFT still needs a lot of infrastructure innovation.

What is NFT?

In a recent bear market for digital assets, there are some bright spots, such as metaverse, GameFi and NFT. In fact, both the meta-universe and gamification finance are closely related to the NFT, so there is a growing need for an understanding of the NFT across the industry. Now it is common to think of art when talking about NFT, which we think is very narrow. What exactly is NFT. We combine own research, give you to do some theoretical discussion.

In 2017, Teacher Yuandao and I translated the English word Token into Token, which was recognized and accepted in the industry. Back in 2017, we had a lot of hopes for the value Internet, blockchain, and open finance in the future. For example, we thought that in the future of value the Internet would have a protocol layer for representing value; Using tokens and digital currencies to express value, we thought that the token economy could mobilize the enthusiasm of tens of millions of users and create new growth models. We judged that finance, Internet applications and games would all be restructured on the blockchain. Today, it looks like those judgments were right.

But I have to admit, one thing we haven't seen is NFT. The value of the Internet that we were looking forward to was based primarily on uniform tokens. When we wrote that article (" Tokens are key to the Next Generation Internet Digital Economy -- one of the Meta Blockchain conversations "), crypto cats were in the big time. The crypto cat tells us that in addition to uniform tokens, there are also non-uniform tokens. We think it is very good, NFT is a complement to FT, an ornament, but by no means mainstream. Four years later, however, I have a completely different perspective on the issue.

I believe that in the future of the value Internet, the majority of tokens will be non-homogeneous, and homogeneous tokens will be only a small part. In other words, the future of the value Internet is built primarily on nonuniform tokens -- NFT.

Review the development course of Network Communication & NBSP;

Before we begin, let's start with a story. As for the development of network communication, in fact, the first electronic communication network is the telephone network, not the Internet.

The telephone network is mainly a circuit switched network. What is a circuit switched network? For example, If Sam wants to call Sam, he sends the request to the operator, who takes out a wire with a plug at both ends and connects them, they can talk to each other. The voice signal can go from zhang sanliu to Li Si like water, very simple, clear, low latency, high quality. But there is a problem, once the channel between the two is established, the line at this time is exclusively between The three and the four, and no one else is allowed to enter. This kind of monopolistic line situation has contributed a word to our Chinese language, which is the so-called "busy line".

Is busy because of the problem, if has been adopted circuit switching network in the past, a number of users, always busy at the moment, the network can't do big, we also absolutely can't be like today while listening to music, watching news, playing the game, because as long as there is an application of the line is busy, can't use other applications. To put it in a professional way, this network is not scalable.

How to make network communication scalable. In 1962, the MIT team came up with a new Network switching protocol, the packet-switched Network for which the Internet works today. One of the most important advances in packet-switched networks is to slice and paste the data that used to flow like water into one packet after another.

What does a packet look like. It starts with a fixed format, which must contain a few specific fields, containing a series of self-describing information, such as what protocol it follows, how big the packet is, the addresses of the sender and receiver, its serial number, and so on. Then, the package has to have a content field where the actual data to be transferred resides. Packets tend to leave this content field undefined and allow you to put anything in it.

To make an analogy, the package is equivalent to putting water in a lot of bottles, and each bottle has a package on it, writing clearly who sent it to whom, the quality of the water, the composition of the water, the number of bottles of water and so on. This is called self-describing information. When data changes from stream to packet, the whole network communication form has changed fundamentally. The core point is to change the simple communication form based on flow in the past into self-describing data packets, and build a highly flexible and extensible network through a series of means such as buffering, storage, replication, routing, forwarding and so on.

NFT is the value packet of the value Internet

With that in mind, let's take a closer look at NFT. Today's NFT is basically based on the ERC721 standard. Let's take a closer look at ERC721 with a magnifying glass. It states that the NFT must have two required fields, one is the publishing contract for the NFT, the other is the TokenID, and then underneath it is a huge "content" field, which is a blank sheet of paper that allows us to do anything in it. You can do anything you want on a piece of paper. Artists were the first to come out and say, let me draw on it. So we see that a large number of NFT are works of art. Game developers came out and said, let's draw land certificates and game gear on them, so now we have NFT virtual land and game gear. However, you should realize that you can put anything in this content field, even nesting dolls and another bottle.

Don't you think the ERC721 NFT looks a lot like packets on a packet-switched network.

So we have interesting historical rhymes. In communication protocols, as we move from circuit switching to packet switching, the key is to turn data into self-describing packets. And now the development of the value of the Internet is still in the ERC20; An era of homogeneous data. The technology has many advantages: it is fluid, computational and simple to use, but it can only socialize with acquaintances between smart contracts, and it can only perform the simplest, most basic actions. If this form continues, whether in the application level, or in the network communication level, the value of the Internet interconnection level, the network will not grow.

We think of NFT as the value packet in the value Internet. It is a bottle of water. After being labeled, the user decides what to put in it. In this case, it can have the huge advantage of being scalable and can easily cross chains. Smart contracts do not need to know which smart contract issued the NFT they are dealing with. This is a very important change in thinking.

The important direction of NFT development & NBSP;

So we wondered if the value Internet could be upgraded to NFT (non-uniform token) to construct the value Internet. In the upgrade process, may need to NFT protocol for basic requirements, in addition to the contract and Token ID, but also a blockchain (Ethereum, wave card, BSC, etc.) chain identifier, with the chain identifier, we can put the & NBSP; Make a cross-chain transfer. The content placed within the NFT should be linked to business and application logic. From this we will gain the important ability: the mutual combination and calculation of NFT across chains.

This ability has just begun to sprout in the blockchain field, and I believe it will become an important direction of NFT development in the future. There are several distinct advantages to doing this:

First, the cross-chain trade of assets can be much easier than today with NFT as the carrier.

Second, NFT can be used for game equipment. NFT can embed a large number of business logic, equipment upgrade business logic can be directly written in the CONTENT layer of NFT. For example, a bronze item can be upgraded to a gold item by adding some diamonds and coins, etc., and this logic can be implemented directly at the NFT level.

Third, a better, more direct, and more readily thought of application is to use NFT for calculable notes, such as commercial paper, certificates of deposit, bonds, standard contracts, bills of lading, pledges, financial derivatives (options, futures), and so on.

Fourth, regulatory backtracking. Due to the strong self-description ability of NFT, regulators can carry out a series of data analysis and supervision based on the self-description information, and carry out a series of norms, requirements, constraints and restrictions on its application, which can bring endless imagination space to the future open financial applications.

If the future value Internet is based on NFT, it will be a major upgrade of the entire value Internet.

Solv Use & have spent NFT Express calculable ticket & NBSP;

The Solv agreement does that third thing, the ticket. We used the content portion of the NFT to create a standard specification for the expression of computable tickets, a new type of NFT that we internally called vNFT. The essence of a calculable ticket is a table, so we constructed a set of standards to implement table calculation. For example, a table representing bill of lading information can be placed in the contents field of the vNFT, and the vNFT becomes the bill of lading. It's easy to think of that.

But Solv goes a step further. As you'll recall, packets in network traffic can be buffered and merged, in a sense, packets are computable, which means they can be split and merged. We think this capability is also very important for NFT, which represents value. Therefore, the vNFT agreement can realize the combined calculation of these two tables, equivalent to the integration of two bills, a bill can draw one hundred books, another bill can draw two hundred books, together is a bill can draw three hundred books. A $1,000 bond and a $2,000 bond of the same size can be combined into a $3,000 bond. This basic computation logic is already implemented in our protocol, not only for merging, but also for splitting, and the main linear computation can be expressed.

Ideal is full, but everything is difficult in the beginning, the first need to be successful application cases to prove. We first choose to use vNFT to express Vesting Token, which is more well-known investor lock-in shares (not only investors, including all the current lock-in, future release of tokens). For example we can lock one hundred COINS in a piece of paper, and then set the release time and release the patterns (according to each block linear release, or periodic release, write the release rules) in advance, good movement rules, notes may be able to move, can also limit can't move, can limit it can only move a second-class. We can even implement a transfer Token to a specific note, where you take a note, and no matter who the note is transferred to, a payment will be transferred directly to the note after the next three months, achieving a removable account. NFT makes digital assets more universal, so we chose this direction, and so far this idea has been accepted by professional investment institutions around the world.

To sum up, we believe that NFT is a better digital value carrier than FT, and it is also an inevitable trend of value Internet. The advantages and leapfrogger mainly come from NFT's self-description ability, which can be customized. In this view, we are most familiar with ERC721, is only the most general, the most common NFT, you put pictures, collections, art, etc. If we could imagine putting something else in it, it would have virtually unlimited applications, and it would lead to a massive wave of innovation in our industry, in the meta-universe, in art, in financial tickets, in games, and so on. The NFT-based value Internet still needs a lot of infrastructure innovation. We also hope that Solv, as a Chinese team, can play an important role in this great process. thank you