The NFT market continues to heat up, and the integration of Decentralized Finance has become a new trend

Recently, NFT( non-fungible tokens ) have become a hot topic in the cryptocurrency space. Data shows that the average sales price of NFT products soared from less than $50 in 2019 to over $100 in August-September 2020, reflecting a significant increase in users' willingness to pay for digital products.

NFT represents a "unique" digital asset that is non-fungible and indivisible. Unlike fungible tokens such as Bitcoin, each NFT is unique, similar to artworks in the real world. Currently, Ethereum's ERC-721 protocol is the most popular NFT standard.

With the rapid development of the NFT market, major public chains have also launched their own NFT development modules. For example, Tezos has introduced the TZIP-12 standard, and Polkadot has released the NFT module Unique. These initiatives have attracted a large number of developers into the NFT ecosystem.

The application scenarios of NFTs are mainly focused on decentralized games and digital art collections. From the Counterparty protocol on Bitcoin in 2014 to various NFT projects on Ethereum today, this field has experienced rapid development.

Recently, the integration of NFT and DeFi( decentralized finance) has become a new trend. This new application, known as "GameFi", combines the entertainment of gaming with financial incentive mechanisms. For example, certain projects allow users to participate in activities such as "mining" or "bidding" using NFTs, enhancing the practicality of NFTs.

A typical example is the NFT insurance project built on Ethereum. Users can generate NFT tokens based on their policies, which can be freely traded on NFT trading platforms. It has been reported that the project achieved a trading volume of 5000 ETH in its first month.

However, as the number of users increases, the security and efficiency issues of the underlying platform have become increasingly prominent. The persistently high Gas fees and security risks on the Ethereum network have prompted developers to seek alternative solutions.

Against this backdrop, some emerging public chains like Tezos are actively positioning themselves. Tezos offers a highly secure, low-energy operating environment and is gradually improving its Decentralized Finance ecosystem, including price oracles, decentralized exchanges, and stablecoin protocols.

In the future, we can expect to see more innovative products that deeply integrate NFTs and Decentralized Finance. As NFTs gradually transcend their pure "entertainment and collection" attributes, their value and application scenarios will further expand, which also places higher demands on the underlying technology platforms.