Dynamic NFTs: The Ultimate And Complete Guide

By Olayiwola Dolapo
13 Min Read

NFTs (Non-Fungible Tokens) have become a familiar term in the blockchain community, extending their appeal beyond the tech-savvy to include artists and creators with little to no technical background. These digital assets are unique, each containing distinct metadata that sets them apart on the blockchain. NFTs represent a variety of items such as artwork, music, virtual real estate, and even social media posts each with a unique identifier that proves its originality, distinguishing it from other items. These tokens can be bought, sold, and traded like traditional valuable assets. The two types of NFTs are dynamic and static NFTs.

Dynamic NFTs are NFTs whose properties can be changed after minting. They rely heavily on smart contracts to change these properties, a new level of interactivity, and functionality, and a fresh dimension to digital asset ownership and interaction.

As NFT technology continues to advance, the scope and applications of these digital tokens are expanding, paving the way for innovative use cases. This article provides you an insight into all you need to know about dynamics NFTs. 

For a better understanding of non-fungible tokens and their safety, consider exploring comprehensive resources titled ‘Are NFTs a Safe Investment?’ by DroomDroom. 

What Are Dynamic NFTs

Dynamic NFTs, often referred to as “Living NFTs,” are a new generation of NFTs that include programmable and interactive features, allowing the creation of digital assets capable of evolving.

These are digital tokens designed to be programmable and responsive to external inputs or conditions, opening up opportunities for interactivity, personalization, and value creation in the digital creator economy. This enables artists to provide a more engaging experience for their buyers.

Unlike traditional (static) NFTs, which represent static digital assets with fixed characteristics, the architecture of dynamic NFTs is designed to respond to external parameters like user behavior, real-time market prices, time, weather, profit or loss, etc.

How Do They Work?

Dynamic NFTs function by storing data in a way that can be edited. Their  ‘dynamics’ are made possible through the use of smart contracts.

Read this complete guide DroomDroom to know everything about smart contracts.

These smart contracts are algorithms built on the Blockchain that run when specific requirements are satisfied. The NFT contains self-executing programs that are designed to automate certain tasks, such as modifying the NFT’s appearance or behavior based on predetermined scenarios. Additionally, they let users communicate with the NFT virtually.

Oracles are used by these NFTs in order to receive and process external parameters or inputs. The NFT’s metadata is updated when external data is sent to the smart contract by oracles. Both the NFT’s appearance and features are updated upon this revision.

The parameters governing how the NFT may develop or alter over time are established by the artist. These so-called parameters can be saved as code, like the Ethereum network’s Solidity code.

Additionally, smart contracts regulate how they are purchased, sold, and traded, and how their artists should be compensated for royalties. 

To interact with these dNFTs, users need a cryptocurrency wallet that is compatible with smart contracts. Next, they can employ NFTs in decentralized applications that enable and take advantage of NFTs’ dynamic capabilities, or they can trade, buy, and sell NFTs on NFT marketplaces.

Benefits of Dynamic NFTs

dNFTs offer a huge number of advantages to the world of NFTs, improving the traditional NFT experience and opening doors to new opportunities. 

Some of the benefits they offer include:


Users and collectors find dynamic NFTs to be more compelling and engaging due to their high level of interactivity. Their capacity to change over time gives users a more engaging experience.


With new applications that may be used in a variety of industries, this feature gives developers the ability to specify the parameters under which they should work, providing a high degree of automation and control. One instance of this would be if a dynamic NFT represented a character in a game that evolved and acquired new skills in response to the player’s advancement.


Because of their versatility, they can be applied to a wider range of industries and services than only digital art. This gives their developers additional chances to create engaging new experiences for their users.

Revenue generation

NFTs give their creators and collectors a steady stream of money because royalties are paid to creators based on how their creations are used or interacted with over time.

Increased exposure

Additionally, dynamic NFTs might aid in boosting brand or corporate awareness. Constant user engagement with the NFT may result in more word-of-mouth advertising and new clients.

Improved Loyalty

A creator’s chances of gaining devoted fans increase if their audience is actively involved with their work and continues to discover new ways to enjoy it. In the long run, this can turn them into paying clients and brand ambassadors for your work. 

These are just a few of the numerous benefits and advantages dynamic NFTs offer. They have proven to be a more flexible and adaptable choice. However, they are not without downsides.

Since dNFTs are digital assets that can be changed and constantly updated over time, it makes them less secure than static NFTs. They are more susceptible to fraud and errors, as any changes to the NFT may not appear immediately. This is due to the different data structures of the token.

Difference Between Static And Dynamic NFTs

The main difference between Static and dynamic NFTs is their token standard. 

While Static NFTs are created using the ERC-721 token standard which is uneditable, Dynamic NFTs use the ERC-1155 standard which can be edited. This type is usually referred to as ‘semi-fungible’ because it can be changed when necessary.

Static NFTs are fixed and are representations of static items. Once they’ve been minted, they cannot be altered. They do not include programmable features and they provide limited opportunities for interaction. 

Dynamic NFTs however are programmable and have the ability to change. They can evolve over time based on different parameters and can include various programmable features like animations. They are a better option in that they are more flexible and provide greater interactivity and engagement for the users.

They even provide more revenue streams for their creators as they can earn royalties based on the ongoing interaction or use of their NFTs.

Application of Dynamic NFTs

Dynamic NFTs offer various use cases beyond what traditional NFTs offer. They can be used in gaming and the metaverse, for rewards and royalties, virtual real estate, sports, digital identity, collectibles, fundraising, tokenization of real world assets, art, music, etc.

Just like static NFTs, they can be used to represent unique artworks or music that can change over time. 

Let’s say we have an NFT representing a live recording of Beyonce’s Renaissance Tour in Germany, it could update itself to include additional concerts in New York or London as they become available. 

They are particularly used to represent characters and in-game items that transform according to the player’s actions and interactions. For example, if you reach a certain level in a game, you unlock new skills, weapons, and costumes as you continue to progress in the game, with these changes reflected in the corresponding NFT.

They can also be used to represent real world assets with constantly changing values that require consistent updates.

 Examples of dNFTs

  1. ‘Crossroad’ by Mike Winkelman Also Known As Beeple. It was designed to alter its appearance based on the outcome of the 2020 U.S. presidential election. Following Joe Biden’s victory, it depicted former President Donald Trump differently.
  1. ‘Merge’ by the pseudonymous digital artist Pak which sold some 92 million dollars worth of mass tokens on Nifty Gateway marketplace.
  1. LaMelo Ball’s dNFT collectibles maintain the records of the professional basketball player’s game stats and change according to the updates in his points scored, rebounds, and assists. You’ll also have priority access to several future updates.
  1. Crypto Kitties: This is a well-known NFT-based game that serves as a perfect illustration of dNFTs. In this game, participants have the opportunity to purchase, trade, or mate digital cats. Each cat is embodied as a dynamic NFT, granting owners the capacity to modify certain attributes linked to the token, including the cat’s genetic makeup, temperament, and physical characteristics.

The Future of Dynamic NFTs

One ground-breaking development in the field of digital assets is dynamic NFTs. They appear to have limitless possibilities for adoption and further improvement. They provide a degree of engagement and interactivity that static NFTs just cannot compete with.

Dynamic NFTs have already proven to have a wide range of applications, from gaming to art and collectibles to entertainment—and they’re just getting started!

Their technology is going to be a big part of how digital ownership and value exchange shifts in the future. Tech aficionados, creators, and collectors ought to keep a careful eye on this market to determine when it’s best to capitalize on the trend.

Frequently Asked Questions (FAQs)

What makes Dynamic NFTs different from traditional (Static) NFTs?

Unlike traditional NFTs which are static and unchangeable once minted, dynamic NFTs are programmable, allowing them to evolve over time and offer a higher level of interactivity and engagement. They also offer additional revenue streams for creators through ongoing interactions.

What is required to interact with Dynamic NFTs?

To interact with Dynamic NFTs, users need a cryptocurrency wallet compatible with smart contracts. They can then use the NFTs in decentralized applications, or trade, buy, and sell them on NFT marketplaces.

What are some potential applications of Dynamic NFTs?

Dynamic NFTs have a wide range of applications including gaming, virtual real estate, sports, digital identity, collectibles, tokenization of real-world assets, art, music, and more.

How do Dynamic NFTs create revenue for creators?

Creators can earn royalties based on the ongoing interaction or use of their Dynamic NFTs, providing them with a steady stream of income over time.

What does the future hold for Dynamic NFTs?

Dynamic NFTs are a groundbreaking development in the digital asset space, with limitless possibilities for adoption and improvement. They are poised to be a significant part of digital ownership and value exchange in the future.

Are there any risks associated with Dynamic NFTs?

Like any digital asset, there may be risks associated with Dynamic NFTs, including smart contract vulnerabilities, market volatility, and potential regulatory challenges. It’s important for users and creators to do their due diligence and understand these risks before getting involved.

After losing his DOGE tokens due to a limited understanding of blockchain technology, Dolapo made a pledge to explore its vast potential. Now, as a dedicated writer, he sheds light on the intricacies of this innovative technology for others. Dolapo distinguishes himself with his expertise in marketing.