With the announcement of Magic Eden and Yuga Labs partnering to create the first contract enforced marketplace on the EVM, many people have been speculating about how this could work for older collections that are already deployed in an immutable format. Many collections have already taken the approach to migrating contracts, including our friends over at Truth Labs (check out FU Blur). The greatest concern with these migrations was the loss of provenance.
Planting something new for all creators... pic.twitter.com/iDrBM46nHk— Yuga Labs (@yugalabs) November 4, 2023
After some initial discussions and workshops, we felt it worthwhile to present a possible solution for migrations that maintain the provenance of the original contract.
ERC-6551 as a solution
Recently, a proposal for a new token standard, ERC-6551, made it possible to provide any NFT with a wallet of its own. Our friends at thirdweb wrote a quick blog with more context on ERC-6551 and we would be more than happy to discuss the token standard in more detail (just shoot us a note).
In this approach, we leverage ERC-6551 to create a mix between a wrapper and token-bound account:
- 01: Holders of an NFT on smart contract A would have the option to mint a new token on an improved, royalty enforcing contract.
- 02: After minting this new token, they would then transfer the token from contract A into the new token’s personal wallet (via its 6551 account)
At this point, there is plenty of creativity on where to go from here. Some key questions to answer:
- 01: How do you incentivize holders of the token to make the migration?
- - One clear option is to only honor utility and activations on the migrated token
- - Another option is to offer rewards or opportunities for completing the migration within a specified window of time
- - There are several methods or combinations that could work, and we would be happy to help you build a strategy that makes sense for you and your project
- 02: Once the migration is made, do you make it irreversible or allow holders to wrap/unwrap?
- - Irreversible actions are often interpreted as limitations of ownership that could stunt adoption of the new token
- - If you do allow the owner to undo the migration, you must ensure there is some mechanism to enforce the consistent use of the wrapper. If individuals simply wrap for activations then unwrap for sales, the intent is lost.
- 03: How do you help owners confirm the provenance of a token between the original and the wrapper?
- - There are plenty of ways to do this on your sites and a standard can be written to support third party tracking
We would love to be a force that supports empowering creators to create lasting value for themselves and their communities. If you have ideas, questions, or want to get started with a migration to enforceable contracts, send NiftyLabs a message!