Centralized

You Don’t Really Own Your NFT

There’s actually some merit to this – as mentioned previously, when you buy an NFT, you generally aren’t purchasing a digital good or piece of art.

The art that represents most NFTs is simply too large to be hosted on a blockchain, and storing even a modest picture could cost thousands of dollars. As such, the assets themselves need to be stored on a separate server, and the NFT itself is little more than a link that points to the address of this database.

Metadata of an actual NFT that includes the name, description and a URL to where its stored

This scares some people – and rightfully so. If your image is stored on a third-party, centralized server, who is to say that they can’t replace the image?

Fortunately, many projects are shifting to decentralized storage services such as Filecoin’s IFPS and Arweave. These services use blockchain technology to encrypt and store data across several different devices, offering the same advantages as a standard database, with the added benefits that no one entity controls your asset.

In addition, many newer NFTs – such as Chainrunners – are opting for simpler formats that allow them to store all of their data “on-chain”.