The NFT market welcomes a new round of rise, linking Decentralized Finance to initiate financial innovation.

The NFT field has recently received widespread attention in the crypto world. Data shows that the average selling price of NFT products was mostly under 50 dollars in 2019, while during August to September 2020, the daily average price exceeded 100 dollars. This indicates a significant rise in users' willingness to pay for digital products, and the NFT market is ushering in a new round of growth.

NFT (Non-Fungible Token) has the characteristics of being irreplaceable and indivisible, representing "uniqueness". Unlike fungible tokens such as Bitcoin, NFTs are more akin to unique artworks in traditional finance, such as the one-of-a-kind asset like the "Mona Lisa".

Currently, Ethereum's ERC-721 protocol is the most popular standard in the NFT field. At the same time, other public chains have successively launched NFT development modules, such as Tezos's TZIP-12 and Polkadot's Unique module. An increasing number of developers from well-known smart contract platforms are flocking to the NFT ecosystem. The average daily trading volume of NFT projects in 2020 rose by about 105% compared to the previous year, demonstrating strong market demand.

The development of NFT can be traced back to the on-chain card game based on the Counterparty protocol on Bitcoin in 2016. In early 2018, the Cryptokitties game on Ethereum achieved great success, establishing Ethereum as the main platform for NFT development. Subsequently, trading platforms such as OpenSea and Rarible became the main traffic entry points in this field.

The ERC721 standard provides the basic functions of NFTs, including transfer, balance inquiry, and ownership. In addition, with the diversification of community needs, more protocol designs have emerged. Currently, the NFT product ecosystem of mainstream public chains is mainly focused on decentralized gaming and digital art collections.

A certain public chain released a multi-asset interface supporting various types of coins and applications in early 2020, allowing users to create and manage NFT assets on its blockchain. The advantages of this chain lie in high security and the ability for network upgrades without forks, promising to simplify the development process of decentralized applications.

Under the influence of DeFi products in 2020, a new generation of NFT products began to integrate with DeFi protocols, gradually evolving from simple collectible proof of rights to more complex financial certificates. These combined products are known as "GameFi," which not only have entertainment attributes but also introduce financial incentive mechanisms.

This combination of DeFi and NFT is mainly used for certifying financial certificates and enhancing the utility of NFTs. For example, a certain project allows users to generate NFT tokens based on insurance policies, with each NFT token corresponding to a specific policy with a defined term and insurance amount, and these tokens can be freely traded on the NFT platform.

As the number of DeFi users increases, the market's demands for the security and efficiency of underlying platforms are also rising. Ethereum's high gas fees and security issues continue to trouble product developers. Meanwhile, the contract deployment volume of other PoS public chains is also significantly increasing, and the decentralized finance application ecosystem is gradually thriving.

In the future, we will see more integration between DeFi and NFTs. As NFT products gradually surpass the "entertainment and collectibles" ecosystem, their value continues to rise, and developers' demands for security and efficiency also increase. Public chains with high security, low energy consumption, and rich integration environments may facilitate more innovative products that combine NFTs with DeFi.