Non-fungible tokens are a unique type of technology, bits of cryptographic code that live on the blockchain, and considering they sometimes sell for hundreds of thousands or even millions of dollars, you might be wondering how they work.
One of the first questions many people have is “How do NFTs distinguish themselves from one another?” They often point to collections that have 10,000 NFTs or more and wonder how the creators have made every single NFT unique.
After diving deeper, the question eventually becomes: “What is an NFT attribute?”
If you’ve had that question before, this article is for you. It attempts to answer, for certain, what is an NFT attribute, why some NFTs are more valuable than others, and what a rarity score is. Along the way, we’ll cover terms like “metadata” and show how these factors influence NFT trading.
Let’s get started.
What is an NFT attribute?
An NFT’s attributes are what distinguish it from other NFTs in a collection. Although all NFTs have unique identifiers on the coding level that also do this, that is often just part of what makes an NFT unique.
To get an idea of what makes up an attribute, first we must consider the legacy of a famous NFT collection: CryptoPunks. This NFT collection, which Larva Labs released for free in 2017, started the trend of using an algorithm to create profile picture NFTs with a collection of attributes that when, summed together, made each NFT distinct.
This process, sometimes called “generative,” involves a unique process of creating different options for certain “traits” featured in the NFTs. In the CryptoPunks collection, these traits or attributes included what the figure wore on their head, their eyes, their mouths, earwear, and much more.
Even though there are 10,000 CryptoPunks total in the collection, each is unique. No two are exactly alike. Many collection creators have copied this form of generating attributes for their digital objects so that no two NFT assets in their collections are the same. Because of this trend, people can claim that no one has an exact copy of their NFT, which can make them highly sought after.
The truth is, when it comes to NFT attributes, they can be just about anything. The creators of those collections often sort them into categories and the categories into subcategories. These, in turn, combine to create mathematical certainty that every NFT is unique. It really is up to the artist’s imagination how many attributes they want to have in a collection and how many different options they want to have when varying them.
What are some examples of NFT attributes?
For this section, we’re going to take a look at two NFTs and cover the attributes they have. The first NFT will be Bored Ape #7495, one of the most legendary Apes in that popular collection. Ape #7495 has a total of eight attributes. The seven attribute types are:
- Attribute count
At any point that you want to check out the full break down of Ape #7495, head over to our Rarity Sniper profile of that NFT. Now, as we’ve discussed, each category has a subcategory, from which you get the actual attributes. The attributes determine the NFT’s appearance, affect its metadata, and combine to form a rarity score. We’ll touch on the last two parts in separate sections later in this article.
The subcategories for this Ape are:
- Earring: Cross
- Mouth: Bored Dagger
- Eyes: Cyborg
- Fur: Dmt
- Attribute count: 7
- Hat: Irish Boho
- Background: Aquamarine
- Clothes: Wool Turtleneck
When you combine all the categories, you get an NFT that is unique. There is no other NFT with the exact assortment of attributes in the collection. Now, let’s take a look at the next NFT: Bored Ape #9606. It is from the same collection but their appearances, due to their differing attributes, couldn’t be more distinct. Here are categories and subcategories for #9606:
- Mouth: Bored Unshaven Pizza
- Eyes: Wide Eyed
- Fur: Black
- Attribute count: 4
- Background: Army Green
Unlike #7495, #9606 has just five attributes. But in terms of NFT uniqueness, what matters is that no other Ape in the collection has the same exact five attributes as #9606. This makes it just as unique as #7495. There are over 175 total attributes in the Bored Ape Yacht Club collection, and all 10,000 Apes have a separate combination of attributes than the others. This leads to a distribution of attributes where all NFTs in the collection are unique.
Why is that important? That brings us to our next section.
Why are NFT attributes important?
NFT attributes serve many important functions. In this section, we’ll focus on three: appearance, NFT uniqueness, and rarity scores. Let’s start with appearance.
Because each NFT (or digital collectible) has a set of attributes that no other NFT in the collection has, each also has an appearance unlike any other. This appearance comes from a compilation of the attributes: the set of characteristics each NFT has. That means aesthetically, almost always, no two NFTs in a collection are alike in terms of the JPEG that is linked to the NFT.
For NFT collectors, this is important. It means that the NFT in appearance is one-of-a-kind, that their NFT is separate from the other NFTs in a collection, and that the NFT will stand out. This is especially true of profile picture NFT collections where holders use their NFT JPEGs as profile pictures on social media apps.
As such, the NFT attributes contribute to that NFT’s uniqueness. There are two primary ways through which NFTs are unique: the identifying code involved in the creation of the NFT and the metadata of the NFT, which involves the compilation of attributes. Again, one-of-a-kind or uniqueness is important. It’s what separates NFTs from a fungible token like cryptocurrency, for instance.
The uniqueness of an NFT is what gives it its collectability. People choose to collect NFTs not necessarily because of the underlying technology. While the tech is cool and necessary, people want to collect an NFT because it has scarcity and that scarcity comes from uniqueness. If there were two NFTs alike in the collection, that would reduce the scarcity of the individual NFT and hurt its value. An owner of the NFT would no longer have bragging rights to it as well.
Those two aspects of NFT attributes tie into another characteristic of NFTs: rarity. NFT attributes contribute to rarity because (as we’ll later discuss in detail) not every attribute appears the same number of times in a collection. Some attributes are rarer than others. People typically want an NFT with rarer attributes because they are harder to find.
Rarity is also crucial for valuing NFTs and promotes trading. Rarer NFTs, even though all are unique, generally fetch higher prices. And that rarity always comes from the attributes. The top sales of NFTs across the board, regardless of almost any collection, involve the rarer (or rarest) NFTs.
Now, how do you create NFT attributes?
How do you create NFT attributes?
If you’ve browsed through some NFT collections, you may be in awe seeing how easily they incorporate different NFT attributes. And if you’re an artist with apprehensions about doing such a task, never fear: the process isn’t as difficult as it seems.
To start, you’ll want to pick an art creation software. Many artists use Adobe Photoshop or something similar. The process by which you’ll create the attributes is called “layering” and involves picking a set of attributes within which there will be various subtypes.
Take the idea of creating an Ant PFP collection. After brainstorming, you decide you want six different types of attributes available for every Ant: Hat, Eyes, Mouth, Earring, Shirt, and Background. You’ll spend some time coming up with the basic sketch of the Ant first, putting together the body and face. Then you’ll start on the attributes.
For each category, you’ll create subtypes. Hat, for instance, may have the subtypes of “top hat,” “baseball cap,” “sailor’s hat,” “army hat,” and “none.” Using the layering tool in your software, you’ll illustrate each of the different types of hats. Keep in mind certain peculiarities of the system you’re using. You may not want the hat to cover the eyes for instance or for the hair of the ant to stick up over the hat.
After you’ve drawn all of the attributes in a particular category, you’ll move onto the next, and the next, until all are finished. Try to name them well in order to prevent confusion when looking at the format later. After illustrating the attributes, you’ll assign each a “weight.” This determines how often the attribute appears in the collection. A higher weight means the attribute appears more often, while a lower weight means the attribute appears less often.
Finally, you’ll use a generative art algorithm to create all the images in the NFT collection. For more information about how to create NFTs, check out our guide titled How to Make or Create an NFT.
Note: Although we’ve talked about PFPs till this point, a similar process would play out for the creation of game items or other types of NFTs.
What is NFT metadata?
NFT metadata is intrinsically linked to NFT attributes and the file that is linked to the NFT. First, a quick definition: Metadata simply refers to the complete set of data surrounding an NFT collection, along with an NFT’s specific metadata. When someone refers to an NFT’s metadata, they are typically talking about the NFT’s attributes, transaction history, linked file, and more.
Chain metadata solves a very specific problem: Because of the prohibitive costs of putting NFT artwork on a blockchain network, NFT creators usually link to the NFT “image.” In other words, rather than the NFT image file being stored on-chain, it is stored off-chain. Typically, the system that stores NFT images is peer-to-peer, which reduces the possibility of a lost image. Many NFT collections use the Interplanetary File System for this purpose.
NFT metadata is imbedded in a smart contract and readable through programs like blockchain explorers such as Etherscan. It is also possible to take a peak at an individual NFT’s metadata through a marketplace UI’s, such as OpenSea’s. That way, users can get a nicely designed way of perusing an NFT’s attributes, transaction history, and any data involving the NFT collection quickly.
In the metadata fields, you’ll typically see a list of the NFT’s attributes, including the number of attributes the NFT has and the names of the attributes. The metadata will then also contain a link to the NFT image, where you can cross-compare the NFT attributes in the metadata to the ones in the image. The metadata may also have additional properties as well.
Next, what is NFT rarity?
What is NFT rarity?
As discussed in the “Why are NFT attributes important?” section, NFT attributes determine a type of system used in the NFT world called rarity. Rarity, in broad strokes, simply means that some NFTs are rarer than others. How can this be when every NFT is unique? It all comes down to the rarity score.
On sites like ours, companies create rarity scores to determine the rarity of a particular NFT within a collection. The NFT attributes themselves combine to create the rarity score, and everything depends on how rare the attributes are. Because rarity scores involve hundreds of attributes, the rarity scores can get complex.
When creating non-fungible asset attributes, most collections generally make some attributes rarer than others. This is called attribute rarity. While some attributes may be common, others may appear as little as 1% of the time in the collection. The rarest NFTs generally have a collection of ultra-rare attributes — ones that appear so few times that their mere presence makes the NFT extremely rare.
Often, the collection price spectrum will organize itself based on rarity, with the most common NFTs being the cheapest and most rare NFTs the most expensive. Frequently, rarity combines with aesthetics to create extremely expensive NFTs, an approach that can yield NFTs in your portfolio you want to look at and that others will desire.
Some collections will even take their rarity strategy a step further and create NFTs that are 1/1s, which simply means they are not part of the generative art algorithm. They are without any attributes and represent the peaks in the collection. As we’ll see in the next section, rarity scores drive trading in several ways.
How does NFT rarity drive trading?
Rarity within NFT collections is one of the key drivers in trading. This happens through numerous angles. First, NFT traders often look for the non-fungible tokens with the highest rarity scores relative to price in order to “flip” them down the road. This creates demand within the collection as traders scramble to find the best “deals.”
People who mint NFTs are often at an advantage here. Because they are the first owners of the NFTs on the blockchain, they can get “lucky” and mint a rare NFT, leading to a high payout relative to the minting price.
Traders who use rarity as part of their strategy often use tools like those on Rarity Sniper’s website to find the best deals. They’ll compare the price of the NFT with its rarity score, “sniping” rares. In fact, Rarity Sniper got its start when the founder created one such tool for the popular Bored Ape Yacht Club collection.
As already stated, the rarer the NFT, the higher the price it generally will fetch on secondary markets. That is because there are fewer NFTs out there like it and with less competition comes a higher price premium. When the NFT is also attractive (has good aesthetics), it has a potent combination for traders and would-be buyers. Aesthetics + rarity is deadly when it comes to trading.
Because NFT attributes are the determiner of an NFT’s rarity score, they play a crucial role in trading as well. The rarer the attribute, the higher an NFT’s rarity score, and the higher the price. NFT collection creators know this and create their attribute system with rarity in mind. One cannot underscore the need to create a good rarity system when creating a collection.
Final Thoughts on NFT Attributes
NFT attributes are essential parts of non-fungible tokens. Read within metadata, they determine an NFT’s appearance, its uniqueness, and drive trading through the NFT’s rarity score. Creating NFT attributes is not difficult but is an important part of the process.
An NFT’s attributes are an intrinsic part of creating scarcity in the digital landscape. Without them and their role in metadata, it would be difficult to consider NFTs property or a specific kind of item. The concept of ownership of the collectibles or digital assets would boil down to just the URI.
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