From Bitcoin to CryptoPunks: The Evolution of NFTs

Bitcoin 2009

Satoshi Nakamoto

A ledger nobody controls. Who owns what is decided by the network’s own rules, not by a bank, a company or a database administrator. Every NFT depends on this idea.¹

Namecoin April 2011

Vincent Durham (“vinced”), building on ideas from appamatto, Satoshi Nakamoto and Aaron Swartz

Unique things on a blockchain, not just coins. Namecoin, a fork of Bitcoin, added names to the ledger. Each name is unique, held by one owner and transferable, and the chain’s rules enforce all of it. Namecoin names are the earliest things we know of that meet the technical definition of an NFT. They were built to expire unless renewed, which is why they are not collectible NFTs.²

Vincent Durham, who posted on the Bitcoin forum as “vinced,” created Namecoin from Bitcoin’s code and announced it in April 2011 as “inspired by the bitdns discussion.” That discussion began in November 2010, when a forum member called appamatto proposed BitDNS, a Bitcoin-like chain for names. In the same thread, Satoshi Nakamoto described a way for a separate chain to share Bitcoin’s miners; Namecoin adopted it, as merged mining, in October 2011. In January 2011 Aaron Swartz described a similar name system on his blog. The Namecoin project also credits Theymos, Dan Kaminsky and Zooko Wilcox with ideas that led to it. The developers who took over from Durham, among them Khalahan Henkh, Mikhail Sindeyev, Daniel Kraft and Jeremy Rand, kept it going.²

Onename 2014

Muneeb Ali and Ryan Shea

A person and a picture, tied to a unique blockchain record. Onename registered a Namecoin name for each new user, paid the fee, and wrote the user’s profile into it, including a link to their picture. It made the blockchain profile something anyone could sign up for. The pictures themselves stayed on ordinary web servers.³

Years later, lapsed profiles from Onename and similar services were reregistered and gathered into the Namecoin “collections” sold as Twitter Eggs and Blockheads (see Namecoin).

Monegraph and Quantum May 2014

Kevin McCoy and Anil Dash

Ownership of an artwork, tied to a blockchain entry. At Rhizome’s Seven on Seven in New York, McCoy registered a Namecoin entry asserting title to his animation Quantum, giving the file’s hash and declaring that “title transfers to whoever controls this blockchain entry.” Monegraph, which McCoy built with Dash, offered the same to any artist. The link between entry and artwork was a convention that people agreed to, not something Namecoin enforced.⁴

Ethereum July 2015

Vitalik Buterin and Ethereum’s founders

A blockchain that runs programs. On Ethereum a contract can define its own assets and its own rules, and the chain enforces them. That made something new possible: an author could create a whole set of items, and the rules for owning and trading them, on the blockchain itself.⁵

Etheria October 2015

Cyrus Adkisson

The collectible NFT. Etheria was the first project to put together what the market fell for in 2021: a set of unique items its author created, defined and enforced by a blockchain, owned outright and forever. It meets every hard and soft requirement of the collectible definition. Along the way it introduced:⁶

• A set its author defined. Each version is a map of 1,089 hexagonal tiles, 457 of them ownable land, fixed by its contract.
• Ownership that never expires and that nobody can take. v0.9 gave its creator no powers over tiles, and the creator powers in v1.0, v1.1 and v1.2 were locked away for good in 2015.
• No two items alike. Every tile has its own place on the map and its own elevation, recorded on-chain, which makes it land or water.
• A whole world on-chain. Ownership, tile names, elevations and the sculptures owners build are all stored on the blockchain, so the shape of the entire world can be rebuilt from chain data alone.
• Building, with rules the contract enforces. In the original 2015 design, owners farmed blocks and placed them on their tiles, and the contract rejected any block that would overlap another, leave the tile, sink below the ground, or float without resting on the ground or another block.
• The first tradable on-chain artworks. The sculptures owners build on their tiles are stored entirely on the blockchain and change hands with the tile, so a buyer gets the artwork itself, not a link or a hash pointing to it.
• A built-in market. In v0.9 and v1.0, buyers make offers that the contract holds, up to ten per tile. When the owner accepts one, the tile and the payment change hands in the same transaction, and the other offers are refunded.

CryptoPunks June 2017

Matt Hall and John Watkinson (Larva Labs)

The profile picture. 10,000 pixel-art characters, free to claim, each with its own attributes, some far rarer than others: 9 aliens, 24 apes and 88 zombies among them. Owners began using them as their profile pictures, and the punk became a mark of identity and status. That use helped shape what NFT culture became in 2021.⁷

CryptoPunks were not the first NFT project, just as Action Comics #1 was not the first comic book. Like Superman, they opened a genre that outshone what came before.