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Combining / Crafting / Breeding

We loosely group combining, crafting, and breeding togethers because these dynamic NFT mechanics all involve similar features.

Basic Mechanics

Dynamic NFTs Diagram

Our Crafting contracts involve a set of input/output router smart contracts:

For example in Example (1), we have two "Owl" NFT inputs, which are combined by transferring them to the crafting smart contract.

Burning (Consuming) or Preserving Input NFTs

Within the crafting smart contract the deployer can define whether the inputs are burned (consumed) or preserved.

Both options are valid depending on how the deployer wants to design their NFTs recipes:

  1. Burning - this destroys the NFT or allows a limited number of uses in the recipe.

    This mechanic is useful for:

    • Consumables - commonly seen in games, items such as potions, food, or other items can be used to enhance a character or another item. In the case of Dynamic NFTs, we see this useful for extending an NFT's expiry, upgrading an NFT, or feeding a pet NFT.
    • Subscription Renewals - for Loyalty Programs, DAO membership NFTs, or VIP passes, a consumable NFT is a great way to create creative ways to stay active. Users can attend events, participate, and more to collect special one-time use NFTs to extend or renew their subscriptions or passes.
    • Crafting - perhaps the most common use case, crafting NFTs is a great way to create cross-game/metaverse mechanics. For example having players collect NFTs from multiple games to craft a special NFT can connect different worlds like never before.
  2. Preserving - this leaves the original NFT untouched, in fact we only require that the user sign to verify ownership. This may make the input NFTs more valuable because they can be used multiple times.

    Usually you want to preserve the NFT, for example in use cases such as:

    • NFT Passes/Memberships - communities, DAOs, and collections may use NFTs as an access pass to content or events. Usually these NFTs are preserved, and even better, with Owl's Dynamic NFT Data standards, you can add parameters to track activity, time the token has been held, expiry dates and more.
    • Upgrading/Enchanting - in games' crafting systems we commonly see weapons, armor, or other valuable equipment preserved, but upgradeable, though this is not always the case. Because Owl's Dynamic NFT Logic contracts are external, you can change the recipe for each item as you choose.

Types of Crafting/Combining Outputs Including Breeding

Also in Example (1), we can see that there is an outputted "egg", there are a number of interesting options for how this egg is generated/created.

  1. Pre-minted Outputs - the most simple mechanic is where a set number of output NFTs are pre-minted and transferred to the crafting smart contract. Once the output or claimable NFTs are depleted, the smart contract will no longer accept new inputs until it is replenished.

  2. Mintable Outputs - the deployer can also assign mint permissions to the crafting contracts for a specific NFT collection, that way once the required input NFTs are transferred to the crafting contract, it can mint the expected output.

  3. Breeding Mechanics - in the case that the input NFTs also have dna, we can use that dna to breed/cross-traits with some random element to produce a semi-predictable output NFT. This of course is known as breeding and quite common in gaming, with CryptoKitties one of the early pioneers, Owl Protocol takes this a step further with more flexible dna and client-side SDKs so that NFTs are not reliant on a centralized API to decipher the on-chain dna.

    In this case, we can create an egg that retains some of the input NFTs' dna, so that when it hatches we get an NFT resembling the parents/inputs.


To learn more about how dna is encoded on-chain for the NFT, see on-chain data and our advanced IERC721Dna Contract Description.

Upgrading/Crafting NFTs to Change the On-Chain DNA

Our smart contracts are quite flexible, and also accept ERC20 tokens! So rather than consuming an NFT to upgrade/change the on-chain dna of an NFT, you can literally pay to upgrade.

Of course in practice it's recommended that only the genesis collection deployer/creator be the one to also create the pre-defined upgrade paths.


For example the deployer of a pet Owl NFT collection, could have multiple levels of an Owl as it grows older, and pre-define the different NFTs you need to "feed" to it, in order to upgrade or grow the Owl to each levels.

This way there is a fair and expected way to improve the NFT, and the deployer in this case can revoke the role to make arbitrary dna changes.