Original Title: “Making NFTs better with Composability”

Original Author: KnownOrigin

Original Compilation: Kxp, Rhythm BlockBeats

The value discovery of DeFi starts with composability, and DeFi Summer has pushed composability to its limits. What about the composability of NFTs?

A few months ago, MonsterBlock showcased composability between single NFT projects, Polkadot's RMRK offered customizable composability, and the NFT platform KnownOrigin has just released "Composable NFTs," which combines ERC-721, ERC-20, and other assets, seemingly refining the imaginative space of composability further.

To help everyone better understand KnownOrigin's new product, "Composable NFTs," Rhythm BlockBeats has compiled the article as follows:

Today, we are excited to announce that we will be launching "Composable NFTs" on KnownOrigin, making it one of the first emerging crypto art markets to feature this functionality.

In recent months, NFTs with broad utility have been a hot topic. Artists are looking to enhance the appeal of their projects by releasing roadmaps, airdropping tokens to reward early users and collectors, and further experimenting in the areas of ownership tokenization and art collection.

We are continuously moving forward and striving for innovation: with the launch of Composable NFTs, we are providing creators and collectors with more opportunities to leverage this new technology for creation, bringing new ideas to the crypto economy.

What Does Composability Mean?

Today, creators and collectors can increase the utility of their NFTs by embedding other digital assets on top of the tokens, allowing for innovative experimentation.

If you are an artist, your artwork can serve as a vehicle for distributing social tokens or other ERC-20 tokens. This way, you can add value to your work and build narratives around the main piece. In theory, you could also set a base price for your work that is intrinsically linked to the value of the underlying composable assets.

If you are a collector, you can use the composability feature to bundle different assets together, creating customized NFT packs. You could purchase a Bitcoin-based artwork, embed a portion of wrapped BTC within it, and then reintroduce it to the market.

"Imagine if you have an artwork derived from your favorite collectible project, and then you embed the collectibles along with the project's native currency into it; this would lead to infinite possibilities."

We believe that composable NFTs are the best way to combine utility, creativity, the new era's web 3 crypto economic vernacular, and token distribution models. We have always valued social tokens, and the release of this feature will provide us with an effective way to allocate social tokens to art collectors. Adding extra tokens to artworks not only increases their value but also rewards potential buyers, as they can continue to add additional value to the piece for future resale.

While it remains to be seen how well creators and collectors can leverage this feature, we believe that endowing artworks with more innovation can undoubtedly enhance their appeal and value.

How to Define Composability?

We have established a solution based on the ERC-998 standard, which outlines how to embed ERC-20 and ERC-721 tokens into other assets.

Behind this, smart contracts hold ownership of any composable tokens and enforce rules that only KnownOrigin NFT token holders can unlock the tokens within the contract.

Only the owner can embed more tokens and redeem the underlying assets, while the smart contract holds the balance associated with specific tokens.

How to Achieve Composability?

To launch this feature, we collaborated with renowned artist Brendan Dawes and the WHALE community.

This combination of artists and governance-led communities allows Brendan to further explore the concept of value through social tokens.

An artwork titled The Composable will include 100 WHALE tokens embedded within the NFT, making the final value of the piece far exceed its initial estimated value as an independent work.

The artwork features an audio clip from a 1968 Bell Labs documentary, vividly illustrating this historic moment for NFTs and revealing the immense potential of the composability feature.

Many well-known artists have their own (ERC-20) social tokens, such as Hackatao, Connie, Skeene, Robness, XCOPY, and Mattia Cuttini, among others. However, whether these artists or others with social tokens face the same question: how can they distribute these tokens to their fans or collectors?

With composable NFTs, KnownOrigin artists can use their artworks as vehicles to embed their own tokens within. This means collectors can not only purchase stunning artworks but also "cash out" the tokens inside.

Things get interesting.

After purchasing the artwork, collectors can decide what to do next:

1. Cash out all the tokens inside and keep the NFT.
2. Cash out the tokens inside and sell the NFT as an independent piece.
3. Only cash out some of the tokens inside.
4. Permanently hold the NFT along with the tokens inside.

Additionally, as a collector, you can also add more ERC-20 tokens to the piece. If you want to create your own social token or wish to increase its base value by adding tokens like WBTC, that would be a great idea.

For the composability feature, this is just the beginning. As this feature continues to evolve, users will be able to embed other NFTs or tokens into NFT artworks. After carefully analyzing the initial usage of the current composable NFT feature, we will continue to explore in this direction.

We are very much looking forward to the release of this feature this Friday and hope our community will love this new functionality.

As always, we will continue to develop and research this new technology, providing useful and valuable tools for the NFT community.

The discussion of "Does art need to be combined with utility?" will continue, but at the same time, we are creating the future, bringing NFTs into a new realm where creativity and utility are unified.