NFTs
What is SPL-404? Solana’s new NFT standard
A new token standard, SPL-404, is gaining attention on Solana for its ability to integrate NFTs and DeFi.
This approach combines the distinct qualities of NFTs with the liquidity and fungibility of traditional tokens, creating a unique hybrid asset.
This token standard allows the exchange of NFTs for a certain number of tokens and vice versa.
What is the SPL-404 token standard?
Think of SPL-404 as a hybrid token – it uses Solana’s Token22 standard to mint NFTs with an intrinsic token value.
Traditional NFTs represent unique digital items such as artwork, collectibles or gaming assets, and are typically less liquid than fungible tokens because each asset is unique. SPL-404 changes this by allowing NFTs to have an intrinsic token value, effectively assigning each NFT a certain number of underlying tokens.
This value may vary based on factors such as rarity, demand, or tokenomics defined by the creators of a given collection.
As a result, this token standard offers more flexibility in trading and accessing liquidity.
Source: Gogonauts, Mall Street, Fluffys, The Delinquents
How does SPL-404 combine DeFi and NFTs?
SPL-404 combines DeFi and NFTs, allowing NFT assets to be more like traditional tokens.
- Ease of trading: If each NFT has a built-in token value, it will be easier to buy and sell. You don’t need to look for a specific buyer – just find someone who wants the tokens to be worth it.
- Accessibility: SPL-404 can reduce the cost of entry into NFTs; Instead of buying a single expensive piece, you can get into the tier that fits your budget.
- Flexible use cases: This new standard opens up some possibilities. For example, in a game, an SPL-404 NFT could be an in-game item with a token value, making it easier to trade or sell when you are done using it.
What are the current SPL-404 designs?
Several projects on Solana already adopt the SPL-404 standard.
These projects leverage the hybrid nature of SPL-404 to offer unique digital assets with more liquidity than traditional NFTs. here are some examples:
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*All financial/investment opinions expressed by NFT Plazas are from the personal research and experience of our site moderators and are intended as educational material only. Individuals are required to thoroughly research any product before making any type of investment.