NFT Metadata: What and Where Is It?
|— NFTs live on the blockchain – but not all of your NFT is there.|
— Your token is a separate component from the artwork or video itself (the metadata) and this metadata probably lives on a server – not on the blockchain.
— NFT metadata storage raises serious questions in terms of cost, security, decentralization and the limits blockchain – and is something every NFT collector should understand.
— Here we explain how the different parts of your NFT are stored, and what it means for you and the industry as a whole.
NFT metadata is frequently misunderstood – let’s change that!
Art, music, videos, fashion, pets, homes, cars, land, PFPs – quite simply, if it can be digital, it can be an Non Fungible Token (NFT).
Beyond their specific use cases, non-fungible tokens are simply media files that have been tokenized, and linked with the blockchain. Yet the composition of NFTs – namely, their different components and where each one lives – is often misunderstood. This makes it difficult for users to properly assess what they are buying when they purchase a non-fungible token.
But in fact, the art for your NFT is probably not on the blockchain. So where the files are being stored? Let’s explore the consequences of where your NFT metadata is stored for you and the space as a whole.
NFTs and Metadata: Two Different Things
Let’s set the scene. Your favourite music star just released a super-rare (and very artsy) collection of NFT video clips, and you’re excited to tell all your mates that YOU are the proud new owner of this iconic clip. It’s right there at your blockchain address, just like your coins and tokens.
Blockchain is pretty amazing, right? Is there anything it can’t store?!
Well actually…it’s a bit more complicated than that.
An NFT is not just one single thing – it’s a package. This package involves two key components: the token itself and the digital content, which is normally a media file. This file – the content and flavour of the NFT – is known as the Metadata. Let’s take a closer look at each of these components.
Most NFT Metadata Is Not On-Chain
Your NFT is a token on the blockchain. The Ethereum token used for NFTs is called an ERC-721 token. This token simply contains data. When you talk about your NFT as a blockchain asset, you’re really referring to this underlying ERC-721.
However, most ERC-721 tokens do not contain any artwork, video or audio files, which is probably the thing you bought the NFT for. Instead, most NFTs contains a link to wherever the media files are stored.
The content for your your non-fungible token, be it an MP3 audio file, video file or JPEG image, generally lives elsewhere, off-chain. So your Bored Ape, Moonbird or metaverse wearables are not inside your ERC-721.
Why Isn’t NFT Metadata Stored On-Chain?
Why? Quite simply – it’s too damn heavy!
At its heart, blockchain is a digital storage system. However, no one designed it with media in mind. To illustrate, let’s look at Ethereum network, which is the main hub for NFTs.
Each full block processed by the Ethereum network is only around 1MB in size – a simple image is around 2MB in size. We’ve all known that sinking feeling of waiting for the gas fees to pop up on screen, just imagine the wait if you were paying for two full transaction blocks?
If we were all using the network to send films, multimedia and pictures, paying huge sums each time would be a reality – and as you can probably tell, it’s simply not practical.
Blockchain Has Storage Limits
Blockchain was not really designed to handle the high volumes of traffic we’re seeing today (one reason why transaction fees are so high), nor was it intended for large files. This is why managing NFTs, normally entails splitting tokens into on-chain and off-chain parts to enable them to run on the network.
Broadly speaking, there are three types of storage for metadata: central server/cloud storage and IPFS among off-chain options and occasionally on-chain on the blockchain itself. Let’s take a look at the different options.
So Where Is My NFT Metadata?
The majority of NFT metadata is stored centrally, in cloud storage, in other words, in centralized servers or cloud servers such as Google Cloud or iCloud.
Such off-chain storage solutions allow the blockchain to handle NFTs in a streamlined way, keeping your ownership on-chain and the media itself somewhere else. But this solution comes with its own inherent drawbacks – all of which relate to our old friend centralization.
As with any centralized online service, the server might go down, the company might dissolve, or you might find yourself unable to access your files due to censorship – and as a result, although your ownership of the token is guaranteed, access to its underlying files is not. A broken server means a broken link, and for you that means a lovely 404 error instead of your media files when you try to trace your NFT content.
Basically, the link to the data inside your NFT won’t work.
IPFS – Distributed Storage Nodes
There is also a decentralized alternative to using central servers while enabling offchain data storage. For more details, read the full article on IPFS. But essentially, the InterPlanetary File System (IPFS) is a storage network, that turns computers across the planet into peer-to-peer “storage nodes” by using their free bandwidth to store files, websites and apps. There is no way of knowing which nodes is supporting a given file or site. This means that it is decentralized and there is no single point of failure. As long as at least one of the many nodes is supporting your data, there is no way of taking it offline. So aside from offering a pretty incredible way of utilizing the computer storage space of the global community, it is also a secure, uncensorable way of storing your digital files.
Using this method, NFT metadata can stay off-chain, reducing gas fees and network congestion.
Some NFT Collections Store Their Data On-Chain
When storing your NFT metadata off-chain, it’s not just the blockchain you need to worry about. But the whole point of blockchain was to remove third parties from the equation when it comes to ownership. So while there are valid reasons for using off-chain storage, finding a way for metadata to exist securely along with the rest of the token is a noble (and logical) mission.
One of the best-known projects to embrace on-chain NFTs is CryptoPunks, albeit for a hefty pricetag in terms of gas fees. This means the entire Punk collection now exists completely on the blockchain, with no reliance on any third party in terms of storage.
But Punks are not the only project adopting that approach. OnChain Monkey is a PFP collection that generates its famous monkey designs directly from its smart contract, and stores them on the blockchain from the get-go.
The collection’s art is known for being simplistic, and that stands to reason. Put simply, no artist put each piece together. Instead, the smart contract created each NFT using pre-programmed themes, traits and variables.
The founders deployed OnChain Monkey’s whole collection in one single transaction. This obliterated the majority of gas fees and lowered the barriers to entry for the project. With images stored fully on the blockchain, the project can guarantee the immutability of the images.
The current options for fully on-chain NFTs may still be pretty limited, but the trajectory is clear. The crypto space, as always, is innovating to push the limits of blockchain as far as it can go. Clearly, we’re yet to see the full scope of that.
On Or Off-Chain: Where You Store Your Metadata Matters
The battle between the two types of NFT metadata storage boils down to striking a balance between security and efficiency. Off-chain storage reduces transaction costs but increases risk by outsourcing metadata storage to a third party. On-chain storage gives complete autonomy to token holders. However, it is prohibitively expensive for owners and seriously impacts the functioning of the wonder network.
Blockchain is evolving each day. New chains are joining the race, offering services at a much lower cost than Ethereum.
Wherever we’re headed, knowing exactly where your NFT components will put you in charge when you’re sizing up new projects. So go forth and deploy your X-Ray vision on your own collection. Now is the time to learn!
Knowledge is Power.
Sometimes getting back to basics is the best way to understand new concepts. So let’s recap blockchain, with School of Block.