The history of Non-Fungible Tokens (NFTs) begins long before the term existed. Even if NFTs were not referred to, projects such as Namecoin and Counterparty paved the way for the innovation of today. Indeed, the notion of uniqueness in tokenization appeared on the Bitcoin blockchain as early as 2010.
Florent D · 03/14/22 · 5 min · Expert
In this article we will look at the main NFT projects in the history of Bitcoin. We will start with the birth of Namecoin (Quantum and Monegraph) then Colored Coins in 2012 and finally the projects born on the Counterparty side-chain (OLGA, Rare Pepes etc).
In September 2010, a discussion was started on the BitcoinTalk forum about a project called BitDNS.
The project that started as BitDNS was born as the very first “alternative Bitcoin”: Namecoin. This means that Namecoin is a cryptocurrency originally forked from Bitcoin software and can store data within its own blockchain transaction database. Namecoin was also the first solution to implement decentralized DNS. This project, supported by Satoshi Nakamoto himself, allows the creation of a .bit domain name, still functional today.
The original work “Quantum” (May 2014) by Kevin McCoy, was created on the NameCoin blockchain, it is generally considered the first NFT in history.
The work was sold in June 2021 for $1.47 million at Sotheby’s “Natively Digital” auction. However, in a complaint filed on 1 February 2022 in the Southern District Court of New York, a claimant asserts that he is the rightful owner of the Quantum work and that he obtained the rights to the work 7 years after its creation. Like the purchase of a domain name, NameCoins must be renewed approximately every 250 days. After creating the work in 2014, McCoy did not renew Quantum in 2015, meaning that the work could presumably be claimed by someone else.
Monegraph is a collaborative project between a New York University professor and a technologist. The project aimed to provide artists with a new way to secure digital property by registering it on the Namecoin blockchain.
To use the service, users had to connect to Monegraph via Twitter and then choose the URL of an artwork. A payment via Namecoin registered the Twitter account and the URL on the blockchain.
Thus, Monegraph became the first project to offer artists a tool to register digital works on the blockchain.
The first mention of the Colored Coins project seems to come from a blog post published in early 2012 by Yoni Assia, entitled “Bitcoin 2.X -(aka Colored Bitcoin)”.
Colored Coins is a meta-protocol that allows users to associate real assets with Bitcoin addresses. Colored Coins encapsulates information on small amounts of Bitcoin.
The idea was to add metadata to Bitcoin transactions corresponding to a state for a token, using the blockchain as a registry. This idea of Colored Coins has been implemented by many protocols, such as OpenAssets, ChromaWay or Colu. However, the main projects have been Mastercoin and Counterparty, which have improved the basic protocol and made it easier to create tokens and track them through a dedicated explorer.
The creation of Colored Coins allowed many people to realize the enormous potential of issuing assets on the blockchain. However, people also realized that Bitcoin itself, in its current iteration, was not intended to enable these additional features. In 2014, Robert Dermody, Adam Krellenstein and Evan Wagner founded Counterparty: a peer-to-peer platform built on top of the Bitcoin blockchain. As such, Counterparty allows the creation of assets, has a decentralized exchange and even a token: XCP.
Counterparty was created in a decentralized way by a community and without an ICO. The way it was created had a great influence on the projects that were developed afterwards. Below we will look at the iconic projects developed on this Bitcoin side-chain: The Thing, OLGA, NILICoin, Spell of Genesis, Force of Will and Rare Pepes and Age of Chains.
The creator of the project has been contacted but did not answer.
The OLGA token was created by 2 Bitcoin transactions. The first fixes the supply to an indivisible token with the description “Моя Вечная One & Only”. The second transaction locks the supply, meaning that no more tokens with this name can ever be issued on Counterparty.
Thus, this token was minted as a gift to the creator’s girlfriend. “Моя Вечная One & Only” translates as “My one and only eternity”. The symbolism is explicit. I imagined it as a “relationship token and it turned out to be a non-fungible token far ahead of its time”. It is indeed the first 1/1 token locked on Counterparty.
September 2014 – NILICoin
NILICoin or art coin was launched on the Counterparty Bitcoin side-chain in September 2014. It aimed to create a protocol where assets could be issued against BTC.
This can be seen as the first form of tokenization as NILICoin was backed by the value of artworks. So buying NILICoins was in effect buying portions of one’s artwork in a proportional way. Approximately 100,000 NILICoins were issued and distributed according to the total value of the art collection. You can find their listing on the xchain.io Counterparty block explorer.
Spells Of Genesis was launched in May 2015 on the Counterparty side-chain. It was one of the first blockchain-based trading card games. An ancestor of play-to-earn (P2E).
Players must collect and combine cards to create the most powerful deck to fight their enemies. Collect, trade and match cards to build the strongest team and challenge multiple opponents as you explore the fantastic realm of Askian
Today, Spells of Genesis can be played on an iOS or Android device, as well as via a PC browser.
In 2016, the creators of Spells of Genesis, launched a second project in partnership with the renowned Japanese trading card company Force of Will (FoW).
Force of Will Battle Simulator features assets on Counterparty as game elements. The game items were tokenized on the Bitcoin blockchain, just like Spells of Genesis. Some FoW items were also playable in Spell of Genesis. This synergy between the games demonstrates the utility of the blockchain in making assets interoperable, creating new opportunities for game developers.
FoW, EverdreamSoft and Indiesquare had also partnered to create a platform for mobile app developers to easily tokenize objects on the Counterparty side-chain.
As the creation of tokens on Counterparty was not limited, many experiments were performed on the protocol. It gave birth to the first social tokens (like Adam Levine’s) and the first real CryptoArt project with Rare Pepes.
In October 2016, people started issuing Rare Pepes on the Counterparty platform as assets. A Rare Pepes is a type of meme featuring this frog character. The Pepes collection consists of 36 different series.
In addition to being registered on the blockchain, the Rare Pepe Meme Directory has “experts” who certify the rarity of the works.
Age of Chains is a game created in 2016 that takes place in an imaginary future. Players must build a deck of cards and defeat their opponent in 1-on-1 battles.
Cards are recorded on the Counternparty side-chain. Wood Coins guardian was the first card released from Age of Chains in November 2016. UG, a Berlin-based company started by Klilian Kunst and Enrico Paiardi are behind the project.
The history of non-fungible tokens is much longer than one might imagine. We have seen how, from a rather vague notion at the beginning, namely an inclusion of data in a blockchain, the concept has evolved and been refined. The first attempts at NFTs took place as early as 2012 with the Colored Coins project.
The story of NFTs is already 10 years old but its future is even more promising, because beyond the fields of art or games, NFTs can change many things in our daily life, by transforming what is common, digital data, into something rare.
History is still being made…
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