ERC6551 is the future
In 2017, the ERC-721 standard was introduced to the Ethereum, establishing a new way to tokenize digital assets. NFTs have been widely used for game items, digital art, music, virtual land, identities, and more. In recent years, developers have been exploring ways to make them more dynamic and interactive, and ERC-6551 is gaining attention as something that expands the possibilities of utilizing NFTs.
ERC-6551 was proposed in February 2023 by Jayden Windle of FUTURE PRIMITIVE and Benny Giang, among others. Benny is also known as the Co-Founder of CryptoKitties, a game that utilizes NFTs.
What is ERC-6551?
ERC6551 is a system that provides every ERC-721 token (NFT) with a smart contract account. The associated smart contract is termed a Token Bound Account, abbreviated as TBA, indicating that it is ‘tied’ to the ERC721. Control (or authority) over the Token Bound Account is given to the holder of the linked NFT. This means that ERC6551 can be seen as a technology that establishes a contract account accessible exclusively by a specific NFT holder. To intuitively understand, it can be thought of as a technology capable of turning an NFT into a wallet — essentially, “NFT as a wallet”.
The advantage of the protocol is that it can be applied to all existing ERC721 NFTs, because it’s backward compatible with ERC721 NFTs
You can check the number of transactions related to ERC6551 here. As of September 21, 2023, a total of 13,152 TBAs have been generated across all EVMs.
Use cases of ERC6551
There are many possible use cases for ERC6551.
(a) Gaming
In the context of blockchain games, one potential use is the ability to use NFTs as agents. By using the Token Bound Account as an inventory, it becomes possible to directly represent the relationship of ‘a character owning an item’ on the blockchain. Assets and abilities acquired through the game will not accumulate in the user’s wallet, but rather in the character itself.
(b) Expansion of NFT projects
ERC6551 allows for the maximization of information linked to NFTs. In existing NFT projects, the amount of information allocated to each NFT was limited to what was specified in the metadata. For example, by sending items, outfits, or equipment to the TBA, the characteristics (information content) of each NFT can increase. Depending on the activity and contribution within the NFT project community, tokens proving such activities can be allocated to the TBA, enabling the creation of attachment levels and reputation systems. Moreover, as the amount of information increases, the potential for composability and interoperability with NFTs expands. In other words, there is a growing possibility for bottom-up addition of utility to NFTs. Advanced NFT projects like Shinsei Galverse have already begun to support ERC6551. We anticipate that all NFT projects will implement ERC6551 compatibility in the future.
(c) Onboarding Tool
Next, We will discuss the potential of utilizing ERC6551 as an onboarding tool for web3 services. By leveraging the Token Bound Account, we can package NFTs and FTs, harnessing the feature that allows them to be linked to a single NFT. It’s challenging for beginners to prepare the necessary tokens or NFTs when trying to use web3 services. In the context of mass adoption, it’s unrealistic to expect every user to buy tokens on a CEX, transfer them to a non-custodial wallet, and then purchase the required NFT on a marketplace. This is where the TBA comes into play. Service providers can package the necessary NFTs or FTs for their service, link them to an NFT, and send this NFT to users, facilitating easy onboarding. Specifically, in blockchain games, one can imagine packaging starting characters and game-specific tokens, then sending them as a starter pack to new users.
(d) Portfolio Market
Similarly to the onboarding tool, leveraging the feature of packaging NFTs and FTs, a use case for portfolio trading can be considered. This means that individuals can assemble portfolios using NFTs and FTs they anticipate will appreciate in value, hold them within a TBA, and by trading the NFT associated with the TBA, it becomes possible to trade portfolios. Taking full advantage of the fact that a TBA is a smart contract, it’s also possible to trade assets within a TBA that have been invested in staking pools or similar. Without revealing the contents of the portfolio, by only disclosing the investment performance using zero-knowledge proofs, we believe it’s feasible to establish a market for portfolio trading through NFT transactions.
(e) Degital ID
Next, we’ll discuss how NFTs that support ERC6551 can be used as Digital IDs when combined with Account Abstraction technology. Since the Token Bound Account is a contract account, it’s possible to enable Account Abstraction, specifically by supporting ERC4337. By doing this, it becomes possible for the Token Bound Account itself to issue Transactions (or more precisely, User Operations). As a result, the TBA can directly interact with dapps. Another way to look at this is that the NFT itself becomes capable of communicating with dapps. Instead of interactions on the blockchain being primarily at the wallet level, they would take place at the NFT level. As a result, on-chain information that used to accumulate based on wallet addresses will now be stored based on NFTs. This information can then serve as reputation data for the NFT as an on-chain identity. We envision each NFT forming its own unique persona and actively engaging in on-chain activities. For example, it’s conceivable that NFTs could participate in DAO activities.
(f) AI Agent
Extending the concept of Digital ID, I believe NFTs can also be utilized as AI Agents. By turning NFTs into wallets, they can accumulate on-chain information. With the learning of this data, an AI Agent can be created. Imagine this in the context of a game where it could be used as an NPC (Non-Player Character). Picture an NFT game character each possessing its own unique wallet, engaging in a simulation game. Characters autonomously conducting business, falling in love, with all these activities being recorded on-chain. How exciting that would be! Furthermore, I believe NFT AI-Agents utilizing ERC6551 could be powerful candidates as Agents in an Autonomous World. The applications of AI Agents are not limited to just games. Imagine a future where societal activities currently taking place in reality are conducted in a digital space based on blockchain. In this space, an AI Agent acting as a digital copy of oneself operates autonomously. And that AI Agent requires an NFT as its body and AI as its brain, with the foundational data for AI learning provided by the Token Bound Account.
(g) NPC（Networked Playable Characters）
Moreover, Benny has a more advanced discussion about NPCs. Instead of Non-Player Characters, he refers to them as “Networked Playable Characters”. What does that mean? Benny explains it as:
Networked = Connected by a community and also by a shared collective state. Every action taken adds to a public record of history.
Playable = The unique set of actions that the owner can take. It usually results in a sense of control and emotional delight when performed.
Characters = A fictional or non-fictional avatar operated and controlled by the owner. The owner could be a human, an AI-assisted human, or an AI.
What do you think? While I don’t fully understand everything, I envision a community where transactions are conducted through the consensus of each agent, regardless of whether they are AI or not. This seems closely aligned with the concept of a council-based DAO. Reputation, derived from the on-chain activity history, accumulates in the NFT, allowing it to function as a council. Transactions can be executed only when agents with high reputations, chosen as part of the council, agree. For instance, in a community with the objective of increasing assets by 2%, it’s conceivable that directives could be executed based on the collective decision-making of asset management council NPCs.
(h) Chain Abstraction using ERC6551
Next, I’d like to explain the technical features of ERC6551 that we’re particularly interested in. We’re highly invested in realizing chain abstraction through the combination of ERC6551 and cross-chain technologies. To actually utilize a TBA deployed across multiple chains, users need to verify they hold a specific NFT on a designated chain, necessitating cross-chain communication tools like Layerzero, chainlink-ccip, or Lit. We plan to delve deeper into implementation methods in a separate article.
We are excited about the potential of combining ERC6551 with cross-chain capabilities. In simple terms, it’s possible to aggregate assets across all EVM-compatible chains under a single NFT. This supercharges our vision of NFTs as agents, maximizing the amount of information they can hold. With this maximization of information, a myriad of composability and interoperability possibilities emerge.
How we are approaching ERC6551
Loot Adventure
Lastly, we’d like to explain how we utilize ERC6551 in our blockchain game, Loot Adventure.
Loot Adventure is a blockchain game themed around “The pursuit of the unique fun of blockchain,” characterized by its three main features: Interoperability, Composability, and Accumulativeness. A significant technical element of the game is its use of ERC6551.
The basic flow is as follows:
① Apply ERC6551 to the Loot NFT and deploy Token Bound Accounts across multiple chains.
② By equipping NFTs or FTs to the deployed TBA, the main character, the Loot NFT, is enhanced.
③ Use the enhanced character to explore dungeons and earn NFTs as “experience points”. These are accumulated in the TBA in the form of SBT.
④ Use the enhanced character to battle in the coliseum and earn FTs.
Since we deploy TBA across multi chains, we can collaborate with NFT projects and blockchain games on all EVM-compatible chains, providing utility as character equipment.
We won the 1st Prize at the Oasys hackathon with the above concept, and have also received awards at various other hackathons.
We are aiming for a launch next spring, so please look forward to it.
Other Projects
・Arachne Protocol
It’s an NFT management console using ERC6551. You can deploy TBA on any chain, allowing your NFTs to hold assets across all EVM chains and connect with dApps. We plan to develop this on ETH Istanbul. Our goal is to create a protocol that maximizes the potential of all ERC721 NFTs.”
・Lootopia
A project pursuing the Autonomous World. In line with Loot’s philosophy, we are envisioning a ‘Text Only World’. Here, we plan to use NFTs extended by ERC6551 as on-chain identities. In the future, we intend to evolve them into AI Agents.
Contact Us
If you are interested in Loot Adventure, please don’t hesitate to reach out to us on our social media.
Additionally, if you’re intrigued by the ERC6551 technology itself, we’d love to hear from you. We have created a Telegram Group to further explore ERC6551 and the Autonomous World. Let’s exchange ideas there!
written by @SouthCloud0703
