Receiving airdrops in NFTs is just the appetizer of the xNFT gameplay, which has the potential to turn wallets into “Web3 WeChat”.
Owners of Mad Lads NFTs have just received W tokens airdropped directly into their NFTs. Instead of going to an official airdrop website, they received the airdrop “inside” their NFTs. This novel experience has sparked curiosity and further exploration. It turns out that the xNFT protocol launched by Backpack allows for the tokenization of code, making NFTs executable programs that can enable advanced and customized functionalities.
An NFT in a wallet is essentially an executable program, and owning it gives you the right to use it. Utilizing the combination of NFTs and applications, Mad Lads had previously built a staking point system and a badge achievement system within their NFTs, but only the owners were aware of it. The arrival of the Wormhole airdrop sparked widespread discussions online, with people asking, “Do your Mad Lads have the W badge?” This made this gameplay gain popularity.
People may underestimate the xNFT protocol. The simple question, “Can you receive airdrops in your NFT?” currently has a resounding “NO” as the answer for everyone except Mad Lads owners. In the past, even for top NFT projects that received airdrops, users had to go to the official website to claim them, and there was no interaction with the NFT itself. This was especially true for profile picture (PFP) NFTs, which often lacked value beyond their artistic appeal. The airdrops were detached from the NFTs, and their value was separate from the NFTs themselves. Users could easily sell their NFTs after receiving the airdrops, effectively diminishing the value of the NFTs. The price trend of TNSR tokens after receiving the airdrop can partially validate this viewpoint.
As mentioned in the first paragraph, xNFT enables advanced and customized functionalities. Behind the module that allows Mad Lads to receive airdrops is a complex unlocking contract. Apart from the initial 3,200 W tokens, the remaining 12,800 W tokens are linearly unlocked daily over a year. The airdrops follow the NFTs, so “the NFT is the airdrop.” If you sell the NFT, the unclaimed W tokens are lost as well. After the Wormhole airdrop, the price of Mad Lads NFTs stabilized, and the number of listings on the market continued to decrease.
This is just a simple use case of xNFT. It’s easy to see that the concept of “application ownership equals NFT ownership” or “the ownership of the NFT implies the ownership of the application” behind it could give birth to more possibilities. Mad Lads was the first to demonstrate such possibilities to the world, serving as a “trailer” for what Backpack could achieve. This is also why Backpack, primarily a wallet-focused product, initially focused on building the Mad Lads NFT community. The active and influential community members allowed more people to see what Backpack’s products could do.
There is more that can be achieved.
The Web3 Dilemma in the Web2 World
Let’s start with a question before discussing the solution. The current Web3 world is actually quite “Web2”.
Why do so many startup teams want to build wallets? Why can non-token issuing crypto wallets raise hundreds of millions of dollars in funding? It may be because everyone is betting that wallets can become the “traffic entrance” for the Web3 world, just like browsers in the Web2 world. However, the problem is that most crypto wallets today are essentially browsers with wallet modules added, wrapped in a shell. If the intention is to onboard traditional users with a Web2-like experience, then how can they compete with browser giants like Brave, which have already integrated wallet modules into their browsers and have tens of millions of users?
These wallets have high substitutability and only provide a Web2-like experience, failing to take advantage of the benefits of blockchain as a public ledger and solving ownership issues. They have not created a “Web3-native” experience.
Joining Holder Communities is Challenging
Many people buy NFTs to join the Token Gated Communities behind them. The ability to be in the same chat group as celebrities like Stephen Curry and Justin Bieber or top traders and project teams was a major selling point for NFTs like Bored Ape Yacht Club (BAYC).
However, joining these holder communities is actually quite challenging. First, during the process of buying NFTs, transferring tokens from exchanges to crypto wallets can be difficult for users who have never interacted with the blockchain before. Then, they need to go to NFT marketplaces, authorize, and make purchases. After buying, they have to go to the designated tools specified by the projects to link Discord and verify NFT ownership with their wallets.
If everything goes smoothly, you will eventually enter a Discord channel for holders. This is not very Web3. And any mistake during the process, such as sending tokens to the wrong address or being phished during the authorization and verification process, can result in financial losses. Even as Web3 players, if we send a favorite NFT to our Web2 friends without detailed instructions, they may not be able to complete the steps successfully. Can such a user experience support mass adoption?
Web3 WeChat
How does xNFT solve the aforementioned problems? What inspired it?
The answer lies in the East.
In China, are browsers still the traffic entrance for Web2? Perhaps only the price of domain names that are a fraction of their peak value can tell us the answer. Fewer Chinese people are typing URLs into browsers; instead, they use various apps directly. Furthermore, the trend is for everyone to use “super apps” like WeChat, with different services running as “mini-programs” on the WeChat platform. WeChat has become a new form of traffic entrance.
Executable NFTs for a Native Experience
Armani Ferrante, the co-founder of Backpack, was inspired by WeChat, which his wife, who is Chinese, introduced to him. With the xNFT protocol, Backpack has the potential to develop into a “Web3 WeChat”.
Using the xNFT protocol, the combination of “wallet + executable NFT” could potentially replace the combination of “browser + web applications” and become a new interactive paradigm with Web3 characteristics. In this mode, the concept of Web2 is dissolved. The wallet manages assets, and the executable applications are also part of the assets. With different xNFTs, users can access different dApps. The relationship between Backpack and different xNFTs is similar to that between WeChat and different mini-programs.
Now, if you own a PFP xNFT, you can open and execute it and enter an exclusive chat group for holders. And all of this happens within your wallet, without the need for Discord or NFT ownership verification websites. The combination of “wallet + NFT” is a more Web3 interaction pattern, and the experience is relatively more natural: if I own this NFT, I should be able to enter an exclusive group. Why do I need to interact with unrelated websites?
Now, if you want to give your favorite NFT to a Web2 friend, you just need to have them download Backpack and send you their wallet address. After receiving the NFT, they can open and execute it, and they will be in the same exclusive encrypted community as you, successfully onboarded. This user experience may be more conducive to mass adoption.
Everything happens within Backpack. Executable NFTs could make the Web3 experience native.
New Distribution Methods and Traffic Entrances
xNFT brings new content and application distribution methods, which may help Backpack become a traffic entrance.
The most common solution in Web2 to get users to use their developed applications is advertising. However, this model is not very efficient. Exchanging massive ads on YouTube for user clicks is costly and doesn’t guarantee the number or proportion of target users among the ad audience. To ensure that NBA fans see the ads, many Chinese companies advertise in Chinese within NBA stadiums. But for non-Chinese-speaking NBA fans, these expensive ads are ineffective.
How can content and applications be distributed more targeted and efficiently?
Since xNFTs are also applications, project teams can proactively distribute these xNFTs to users’ wallets who have certain behavior characteristics, based on on-chain interaction records. For example, a blockchain game project can airdrop their game to wallets owned by many blockchain game enthusiasts while also selling it at a regular price on the NFT market. Will players who get a free copy of a paid game be interested in trying it out? If they find it fun, will they promote it actively, thereby driving overall game sales? It’s possible.
This new distribution method may attract many developers to create their applications as xNFTs for distribution through Backpack. Backpack can then become a “traffic entrance” and “Web3 WeChat”.
xNFT is an important piece of the Backpack vision
Tristan Yver, co-founder of Backpack, mentioned in a speech at Consensus2023 that it was the powerful idea of xNFT that made them feel that starting a company for this purpose was meaningful. This demonstrates the importance of xNFT in the Backpack blueprint.
If you try the mobile app of the Backpack exchange, you will see that they are trying to tightly integrate the functionalities of the exchange and the wallet. The two distinct functionalities have similar user interface designs and can be switched with a single click. The author believes that Backpack is attempting to unify the currently fragmented user experience and integrate all the different functionalities that meet crypto-related needs into a unified experience. To achieve this vision, the ability of xNFT to make the Web3 experience native and help Backpack become a traffic entrance may be essential.
Note: This article represents the author’s personal views and is based on publicly available information on the internet. It does not constitute investment advice.
Original article: https://www.bitpush.news/articles/6619227