A major challenge we see for brands and creators launching NFT collections is the obligation to consistently deliver value to collectors or find new ways to increase the collection's financial worth. Releasing static artwork isn’t enough, and creators are left with the pressure and expectation to deliver something more to satisfy their audience.

We love how much web3 has given new life and value to art. But, NFTs as a means to continuously extract money from customers have stigmatized the space and distracted from their true potential. Enter Dynamic NFTs

Unlike traditional NFTs that are static and don’t change, dynamic NFTs are digital assets that change and evolve based on things like data, user interactions, or even other NFTs.

For both existing brands looking to provide something new to their audience and new creators looking to go beyond PFPs, the next opportunity is in using dynamic NFTs to transform art into experiences.

‍

Fregg

In March, we released a web3 virtual pet game—Fregg. Its premise is simple: come back each day to take one action to care for your Fregg. Over time it grows and evolves. And for extra engagement, Fregg owners compete for prizes and rewards.

When coming up with Fregg, we had one goal—Create an NFT collection that people would enjoy without needing to know it’s an NFT collection.

As a team of product designers, we believe that onboarding the next generation of users onto the blockchain should be a breezy, frictionless experience. That means that it should be easy to adopt without needing a lesson on web3, NFTs, or crypto. No one cares about what technology is being used as long as the experience is what they want and easy to use. We took great care in designing Fregg as a great experience first and a lesson in NFTs second.

‍

Fregg game design

We’re a bunch of 90s kids. Inspired by the toys and games of our childhood, like Pokémon, Digimon, Tamagotchi, and Neopets, we thought it was a great opportunity to take a new approach to familiar concepts—on-chain pocket monsters and virtual pets that evolve as you continue to interact with it.

We wanted to maintain enough of a tight budget and timeline to prove our concept while focusing the user experience enough to delight and engage our players.

Fregg’s gameplay is simple: visit your Fregg and interact with one task every day in order to keep it alive. After a number of days of caring for your Fregg, it evolves into its next form. The Fregg collection is made up of 26 species. Each species has 4 evolutionary stages for each: egg, baby, teen, and adult. Freggs hatch from an egg to a baby the day it’s created. It evolves from a baby to a teen after 7 days of care and then an adult after another 14 days of care.

We also devised incentives for players to continue caring for their Fregg that included unlockable rewards like digital stickers and physical merchandise.

Fregg as a lesson in dynamic NFTs

With Fregg, we wanted to reframe the perception of NFTs by thinking of NFTs as a memory card. Players create their Fregg by giving it a name, choosing a case color, and egg type to hatch. These details create an NFT and are saved on the blockchain. As players visit and engage with their Fregg, its progression and evolution is saved and the NFT is updated on-chain. Likewise, the neglect of a Fregg results in a token with diminishing hearts until the Fregg dies and the NFT displays a ghost.

There are aspects of traditional NFT collections that we wanted to honor. To maintain the excitement and anticipation of randomized traits, players get to choose the type of egg they want to hatch, but the species that hatch and the Fregg’s home background are randomly selected.

We also wanted to demonstrate the utility of the NFT throughout the gameplay. Starting from 2 experience points, players can use their NFT to unlock a Shopify store specific to the Fregg’s species and its current evolutionary stage. The rewards are digital downloads or physical merchandise related to the player’s Fregg.

Lastly, when it comes to the collection size and rarity, we wanted to leave it to the community to impact the collection based on their participation. Certain Fregg species (e.g. Alien, Crab, Deer, Demon, Mushroom) are rare to hatch. But, the rarity of a Fregg in the entire collection depends on which egg type (Animal, Aquatic, Fantasy, Plant, Sci-fi) the players choose to hatch their Fregg. For example, an Avocado Alien Fregg has an 10% chance of hatching. But since a majority of Fregg owners have been hatching Sci Fi eggs, Avocado Alien Freggs make up 16% of the collection.

A Fregg’s evolutionary stage adds an additional level of traits for rarity. At the time of writing this post, there are 48 Avocado Alien Freggs: 41 in the Baby stage, 0 in the Teenager stage, and 7 in the Adult stage. Since minting, 16 Avocado Alien Freggs have died and turned into ghosts. Depending on how players care for their Fregg, the collection changes as Freggs progress and evolve, or as they die from neglect.

All that said, unlike how traditional NFT collections only get determined during mint, we designed the Fregg collection to change throughout its lifetime as the community continues to engage with their Freggs.

‍

Dynamic NFT examples

Dynamic NFT projects are becoming more popular as brands look to take their projects toward digital experiences.

OG:Crystals

One of the first dynamic NFT collections, launched in 2021 at the start of the NFT craze, OG:Crystals pushed the boundaries of what can be accomplished with art and blockchain. OG:Crystals combine data visualization and elements of generative art. Seed crystals grew as they were sold and transferred, unique to each owners’ crypto wallet history.

Yuga’s Otherside and Otherdeed

Dynamic NFTs that represent virtual land plots in their metaverse, each Otherdeed plot is made up of 5 traits: environment, sediment, resources, artifacts, and creatures called Kodas with some acting as elements players can harvest and use in the game. The evolving nature of these traits provides a rich and dynamic environment within the Otherside metaverse.

Beeple Crossroads

In February 2021 Beeple released a 10-second video as a dynamic NFT; a token that would change based on the outcome of the 2021 election. This piece was a first major sale within the industry where a token would change.

‍

Opportunities of Dynamic NFTs

Dynamic NFTs don’t just stop at art. Because of the nature of dynamic NFTs being able to change and adapt based on user engagement, we see exciting opportunities for dynamic NFTs to improve on existing experiences across different industries.

Loyalty programs and membership

Dynamic NFTs as loyalty programs offer businesses a unique way to engage and reward their customers. The token can represent a membership to a brand or business and can evolve based on customer interactions or transactions. It can unlock additional benefits or discounts as the customer reaches specific milestones or engages with the brand in certain ways. By utilizing dynamic NFTs, businesses can create personalized and immersive customer experiences, driving customer loyalty and encouraging repeat purchases.

Movie tickets

Unlike traditional paper tickets or static digital counterparts, movie tickets on the blockchain can provide an easily accessible history of movie attendance. A dynamic NFT movie ticket could evolve into a commemorative and promotional collectible upon attendance. For example, tickets can take on a different appearance for loyal fans attending midnight screenings. Fans can use it to proudly prove their allegiance to their favorite franchises. Moviegoers can use their NFT to unlock special screenings and promotional merchandise. By implementing dynamic NFTs as movie tickets, movie promoters and cinemas can enhance audience engagement, foster loyalty, and deliver memorable experiences for moviegoers.

Social networks

Social networks are another area where dynamic NFTs can make a significant impact. Users can create dynamic NFTs as avatars or digital assets that evolve based on user interactions, achievements, or external events. For example, an avatar might change its appearance based on the number of followers they have or their engagement level on the platform. With the incorporation of dynamic NFTs, social network experiences become more engaging, encouraging users to interact and participate more actively within the platform.

Gaming

By representing in-game items, characters, or assets that change based on the players’ achievements or interactions, dynamic NFTs create a more personalized and immersive gaming experience. For example, an in-game weapon might evolve as a player progresses through the game, or a virtual pet could grow and evolve based on how the player interacts with it. The introduction of dynamic NFTs into gaming paves the way for entirely new gameplay mechanics and experiences that may even eventually be used universally.

‍

The future is dynamic!

Dynamic NFTs hold incredible potential to add value to existing brands, new collections and even revolutionize various industries. Our project, Fregg, underlines the benefits of adopting dynamic NFTs to create immersive digital experiences that extend beyond traditional static NFT collections.

At Kairos, we believe in making cutting edge technology accessible to everyone. As we’re seeing brands and creators wanting to bring deeper engagement to their audience or transform their existing collections into digital experiences, we’re excited to offer our creator platform and developer tools to make it easier for anyone to create dynamic collections. If you’re interested in partnering with us, we would love to talk!