KnownOrigin has announced its imminent shutdown, sparking fresh debates about the reliability and longevity of NFT storage solutions. eBay’s acquisition of KnownOrigin in June 2022 was seen as a strategic move to enter the NFT market. However, less than two years later, KnownOrigin is closing down its on-chain marketplaces and minter, directing users to secondary marketplaces like OpenSea and Magic Eden.
KnownOrigin bows out
KnownOrigin, founded in 2018 in Manchester, England, quickly became a key player in the digital art space, enabling artists to mint, sell, and trade NFTs. After eBay bought KnownOrigin in 2022, the platform was expected to leverage eBay’s vast user base. Despite the promising outlook, KnownOrigin recently announced via posts on X that it would be winding down its services.
The IPFS debate: on-chain vs off-chain storage
The shutdown has ignited discussions about the reliability of the InterPlanetary File System (IPFS) for NFT storage. Digital artist Ella, known as BrightLightArt, highlighted a key concern in a post on X: "If eBay stops paying the IPFS storage bill, the art will eventually die."
Most NFTs are not stored directly on the blockchain; they contain metadata that points to an off-chain file stored on platforms like IPFS. If the entity maintaining the IPFS node stops, the data could become inaccessible, making the NFTs worthless.
Understanding what you “own” with an NFT
Digital researcher Jonty Wareing shared on X that purchasing an NFT often means buying a token pointing to a URL or an IPFS hash. This URL usually links to a JSON file hosted on a platform’s server.
Even NFTs using IPFS hashes for storage risk becoming inaccessible if the entity responsible for pinning the file stops operating, as seen with KnownOrigin. Jonty warned that most NFTs could be broken within ten years due to these vulnerabilities.
Ethereum engineer Sam (@cloudonshore) supported these claims, emphasizing the need for better tools and practices to secure NFTs.
Potential solution and future considerations
Arweave is being considered as a more reliable storage alternative. It offers permanent data storage for a one-time fee, storing files across a decentralized network to ensure long-term availability.
What’s next?
KnownOrigin’s closure is a wake-up call for the NFT community, emphasizing the need for better storage solutions. The reliance on off-chain storage and the associated risks need addressing to preserve the value and integrity of NFTs.
As technology evolves, NFT platforms, artists, and collectors must advocate for more secure and sustainable storage solutions. The discussions sparked by this event could lead to significant improvements in storing digital art, benefiting the entire crypto-art community.
