Smart Contracts and NFTs: Non-Fungible Tokens as a Core Component of Blockchain to Be Used as Collectibles

Non-fungible tokens are one of the most important future application domains for smart contracts. Ethereum is the pioneer of a blockchain-based decentralized computing platform that has ultimately standardized these types of tokens into a well-defined interface, now known as ERC-721. Blockchain-based cryptocurrencies have received extensive attention recently. Massive data has been stored on permissionless blockchains. This paper aims to analyze blockchain and cryptocurrencies’ technical underpinnings, specifically non-fungible tokens or “crypto-collectibles,” with the help of a blockchain-based image matching game. While outlining the theoretical implications and use cases of NFTs, this paper also gives a glimpse into their possible use in the domain of human user verification to prevent misuse of public data by automated scripts. This demonstrates the interaction of the ERC-721 token with the Ethereum-based decentralized application. Further, we aim to reach a definitive conclusion on the benefits and challenges of NFTs and thus reach a solution that would be beneficial to both researchers and practitioners.