Hot DeFi Summer: An NFT’s road trip from Hedera to Ethereum
With NFT.NYC coming to a successful close last week and the Hedera NFT community’s strong presence at the event, we thought it’d be appropriate to do something special to showcase the incredible application ecosystem on Hedera.
You may have noticed that the Hedera Twitter profile picture is now a hexagon and displays the Hedera logo branded into a delicious summertime treat: a pink ice cream nestled in a waffle cone — we’re in the midst of Hot DeFi Summer on Hedera, after all, with tons of Hedera-powered DeFi applications and developer utilities, such as hgraph.io, coming online.
If you thought “only Ethereum NFTs can be displayed as a profile picture on Twitter”, you’d be correct — the NFT is an ERC-721 token on Ethereum. But what’s more important is the network on which the token was initially minted (Hedera), the journey on which it embarked to becoming an ERC-721 token on Ethereum, and the ingenuity and innovation of the Hedera developer ecosystem.
This summer road trip employed several applications and utilities built by the Hedera developer community, including a:
Browser wallet for managing NFTs and paying mint, transfer, and bridging fees.
Marketplace for configuring and minting NFTs using interoperable standards.
Bridge the NFT over to Ethereum.
Tokenized carbon credit marketplace to offset the environmental impact of the entire process.
And, like most real-world summer vacations, we had to stick to a budget. For each leg of the journey, we documented our costs. Thankfully, fees on Hedera are fixed, based in USD, and paid in HBAR for all transactions as we’ll detail below; you can estimate the operational costs of any Hedera-powered application by visiting https://www.hedera.com/fees/.
With that, let’s start our journey!
HashPack Browser Wallet: The vehicle for our summer road trip
Most road trips require a vehicle to get you to your destination. In our case, this journey involves pit stops at Hedera-powered NFT marketplaces and DeFi applications and crossing a network bridge. The vehicle we’ll be using is the HashPack Browser Wallet.
HashPack lets you create an account on the Hedera network, buy HBAR using a bank card, manage your NFTs, and sign transactions for applications powered by Hedera.
We followed the simple account setup process to get started with HashPack and purchased some HBAR using our bank card. Once “packed up” for our trip with a Hedera account and some HBAR, we were ready to embark on the rest of our journey.
Nearly every wallet that supports HBAR allows you to create a Hedera account for free. Here’s a breakdown of the costs associated with creating an account on Hedera and transferring HBAR.
Create a Hedera account
$0.05 USD (Free using HashPack)
HashAxis NFT Marketplace: Because snacks are a must
What’s a summer vacation road trip without snacks? On the first leg of our journey, we jumped into HashPack and cruised over to HashAxis (case study) marketplace to pick up our favorite snack: ice cream (aka creating an NFT collection and minting our very own Hedera ice cream cone).
HashAxis is a one-stop shop for minting, buying, and selling NFTs on Hedera. This marketplace uses HIP-412 standards on Hedera for minting NFTs (meaning the token is ERC-721 compatible), ensuring interoperability across Hedera-powered applications and those on EVM-based networks such as Ethereum and Polygon.
Minting an NFT on HashAxis was easy — we signed up for a HashAxis account, verified the Hedera account ID we created in HashPack, created our first collection, minted our first 1/1 NFT, and then sent it to our Hedera account managed by HashPack.
If you’re wondering where the media file and metadata are stored, most NFT minting tools on Hedera use FileCoin IPFS — if building your own NFT application, you could use several other decentralized storage solutions, such as Arweave, JStor, or others. HashAxis displays the content identifier (CID) used for pinning objects in IPFS. Today, those decentralized storage fees are entirely free.
Create an NFT Token ID (collection)
Mint an NFT in a collection
Associate a Token ID with a Hedera account
Transferring an NFT
hashport network bridge: Over the river and through the woods, to Vitalik’s house we go
On some road trips, you must cross a bridge — some are architected more securely than others. Thankfully, the bridge we’re crossing, hashport (case study), is incredibly secure and governed by nine independently-run decentralized validators. These validators are hosted by Polygon, Calaxy, Animoca Brands, HBAR Foundation, Hex Trust, Worldpay Global, StableNode, BCW Group, and LimeChain.
hashport is an enterprise-grade public utility that facilitates the movement of digital assets between decentralized networks, extending their functionality quickly, securely, and cost-effectively.
Officially Recognized Wrapped Asset Inclusion
It’s worth noting that for hashport to be cross-ecosystem friendly and reduce fraud, originating asset types need to be recognized as “official”. In practice, an asset’s creator (typically a protocol or NFT project) must request the asset’s inclusion.
From there, hashport’s independent validators vote and sign off on assets for their inclusion. For example, the validators included $HBAR, $CLXY (Calaxy), $JAM, $DOV, $ETH, and $MATIC for bridging between Hedera, Ethereum, and Polygon. They’ve also disclosed the official Smart Contract addresses for wrapped versions of these assets. And new supported assets are being regularly announced, such as $DAI, $LINK, $USDT, $USDC, $wBTC, and $AAVE to help create cross-chain liquidity and support DeFi protocols on Hedera in the process. Retail users benefit through reduced transaction fees, expedited transaction times, incredible scalability, and the elimination of frontrunning.
In the case of our NFT, we requested that its token ID be added, and the network validators approved our request. If you’d like hashport to consider your project’s assets for inclusion on the hashport bridge, please reach out to [email protected].
Bridging our 'Hot DeFi Summer' NFT to Ethereum
First, we installed Metamask, the most ubiquitous Ethereum browser wallet. Then we purchased $ETH to pay transaction fees associated with minting a wrapped version of our NFT using hashport’s smart contract. hashport was incredibly easy to use: we connected our Ethereum account using Metamask, our Hedera account, and then followed the on-screen instructions to transfer our NFT from the Hedera network to Ethereum.
When initiating the bridging of our NFT, hashport displayed all of the required steps to transfer the asset to Ethereum successfully.
You can view the complete Ethereum transaction, including the Smart Contract which minted the ERC-721 token of our wrapped NFT, here.
And the complete Hedera transaction, including locking the original Hedera Token Service NFT in a multi-signature Hedera account owned by hashport, here.
This is where our summer road trip started getting more expensive and environmentally unfriendly, stemming from our use of Ethereum. Here’s a cost breakdown for bridging our NFT from Hedera to Ethereum, using hashport. In the following section, we’ll estimate our carbon footprint and required offsets. Hashport will provide more information about NFT bridging fees in the coming weeks.
NFT transfer on Hedera to hashport locked account
0.016 HBAR ($0.001 USD)
1.1 HBAR ($0.07 USD)
Ethereum NFT minting fee (Gas)
0.018655 ETH ($115.43 USD)
*It’s important to note that hashport’s NFT bridging feature is in beta. hashport would typically charge a fee (in HBAR), but for this particular example, the bridging fee was only 1.1 HBAR.
DOVU Tokenized Carbon Offset Marketplace: Because we’re committed to reducing the impact on our environment
DOVU (case study) is a tokenized data economy for DeFi carbon offsetting built on the Hedera network. It connects land owners who’ve committed to carbon sequestering practices and investors or businesses who want to offset their carbon footprint. The carbon offset tokens are represented as $DOV and are available on both Hedera and Ethereum.
DOVU offers Metamask users an easy-to-use calculator to determine the total carbon footprint of their Ethereum transactions. It allows you to easily purchase tokenized carbon offsets represented as $DOV tokens on either Hedera or Ethereum. The total transaction count for this account is 1, and the CO2E emissions were 59.5910kg (the equivalent of 65.9 pounds of coal burned).
By participating in DOVU’s Operation Bloodmoon to bring more tokens to Hedera and assist in offsetting Ethereum’s environmental impact, we offset the carbon emissions of our Ethereum transactions by claiming $DOV tokens on Hedera for free. Upon clicking “Claim Tokens”, the application prompted us to sign up for DOVU and enter our Hedera account ID. $DOV tokens were then deposited directly into our Hedera account.
Twitter’s NFT Profile Picture Functionality
The “Hot DeFi Summer” NFT was successfully transferred to the Ethereum account used by hashport, and the metadata associated with the NFT is readable by both OpenSea and Twitter’s NFT profile picture functionality.
We believe it’s important that everyone participating in web3, including Twitter’s NFT profile picture functionality, be conscious of their impact on the environment. Greater adoption and encouragement of networks and applications with a small environmental footprint, such as Hedera’s carbon-negative network, will assist in pushing web3 and its users towards a more sustainable future.
Swirlds Labs and the Hedera ecosystem are committed to supporting Twitter, from both a development and resource perspective, if they consider incorporating Hedera NFTs into their profile picture functionality.
The future of the Hedera ecosystem
This is just the beginning of a robust ecosystem flywheel on the Hedera network. Over the next 6 to 12 months, an incredible number of Hedera-powered applications across DeFi, sustainability, and metaverse will be coming online.
They’ll offer new assets native to Hedera and incentivize users to bridge existing assets from other networks. We anticipate a massive increase in adoption as both developers and retail users recognize the unique attributes of Hedera and its ecosystem applications. I’m personally excited to watch the Hedera ecosystem evolve and thrive and invite you to join along as the journey unfolds.