What is Enjin (ENJ)? The NFT Support Token Explained
Take a closer look at Enjin (ENJ), how it works and how it's shaping the future of the NFT space.
Enjin is a software to build a new variety of Non-Fungible Tokens (NFTs) that are backed up by Enjin Coins, a digital currency in the Enjin Network.
NFTs are revolutionising the creative and entertainment industry. However, the space for NFTs is still far from perfect. For one, NFTs can be minted “out of nothing”, meaning that in most cases, an NFT is not backed up by a digital asset to define its lowest value. The second is that most game-related NFT tokens are only exclusive to certain platforms.
Another one of Enjin’s goals is to establish a thriving ecosystem of interconnected gaming platforms, allowing players to experience a connected virtual economy across different virtual worlds. This frees up the creative freedom for game developers, modders, artists, and players alike.
Curious about how Enjin can improve NFTs in gaming and enterprise use cases? Read this guide until the end.
- First founded in 2009, Enjin is a blockchain software and platform that facilitates the development, trade, and monetisation of digital assets such as NFTs (non-fungible tokens).
- The ENJ token is the native token on Enjin’s blockchain and is used primarily as a medium of exchange to fund the various operations on the network such as buying, selling, and exchanging of digital assets and NFTs.
- Developers can create or mint virtual goods and assign them to a smart contract, which then assigns a value to that item. ENJ is used to facilitate this process, and when a user acquires those items they can then use it in-game, exchange them with others, or sell them for ENJ equivalent to the original minting cost.
New to NFTs? Read our guide on Non-Fungible Tokens.
What does Enjin do?
Enjin is a B2B solution for NFT creation for the gaming industry as well as for gamification strategies used by various enterprises. Clients can more easily create NFTs for different use cases, without having to know much about programming.
Enjin helps clients to create NFTs that can be distributed and exchanged on Ethereum, but note that Enjin is not a decentralised application (DApp) on Ethereum nor on any other blockchain. Interestingly, the Enjin Coin (ENJ) is an ERC-20 fungible token that is settled on Ethereum’s global ledger.
What Enjin gives to the NFT creation process is true scarcity. So far, NFTs can be minted for “free” (excluding the gas fees) on any Ethereum-based DApp that can encode a piece of the file (photos, music, games, etc.) into the Ethereum blockchain.
How NFTs are valued currently is chaotic, to say the least. There is no specific rule on what price one should pay for a particular NFT. It all depends on supply and demand, in which the price of NFTs, like tulips in 17th century Netherlands, could bubble uncontrollably.
What is an ERC-20 token? In short, these are simply tokens that are used on the Ethereum blockchain and act as assets that facilitate the various utilities and functions on the network. Learn more with our guide.
How does Enjin Coin ‘improve’ NFTs?
In order for clients to create NFTs within the Enjin ecosystem, they would first have to acquire Enjin Coin (ENJ). Enjin Coin is then ‘infused’ into the NFT in the process of minting. Note that ENJ is not consumed, as in, it is not destroyed, but it merely takes a different form.
NFTs that have been created through Enjin can be stored in the Enjin Wallet, where users can swap or trade NFTs for ENJ or other cryptocurrencies. Like all NFTs, the original creator can maintain royalty of the NFT, or the right to be paid a certain percentage for every transaction that involves this item.
Enjin Coin is a scarce token with only a limited supply of 1 billion tokens. Naturally, NFTs that were created using a scarce digital asset will inherit its scarcity. This is unlike conventional NFTs where its creator can mint some more of the same artwork, even if no NFT on the blockchain is identical or replicable.
NFTs minted with Enjin can be ‘melted’. This is the process of destroying the NFT to recover Enjin Coins that were made with it. As a consequence, NFTs minted with Enjin will have a minimum value that is represented by the ENJ contained within it.
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Impact of Enjin NFTs in the gaming industry
The success of NFTs in the gaming landscape is accelerated by the Enjin project. When gaming becomes over-commercialised, some game developers encourage players to pay to win (i.e. buy items that give them unfair advantages over other players or the game itself).
With NFTs, game developers can switch their monetisation strategies by instead allowing the creation of a fair and open creative economy in-game. For example, a game developer can sell mods and texture packs to players, and players can sell these to other players for profit.
Players, too, can create their own work and then sell them directly to players without relying on third-party marketplaces. This encourages the development of a realistic creative economy, whose value is derived from the creative energy of the gaming community.
Backed by the monetary value of ENJ, any NFT in Enjin’s ecosystem has a minimum value. This prevents NFTs from completely losing their value whenever new NFTs emerge.
Related: What is Decentraland (MANA)?
Application of Enjin NFTs in marketing
The use cases for NFTs in marketing are underappreciated. Gamification is a common marketing strategy in which tokens (i.e. points, badges, and other virtual items) are rewarded to users who have completed certain tasks or achievements.
If companies use decentralised blockchain networks such as Ethereum to mint their tokens, customers could trust that NFTs cannot simply be duplicated or modified. The upside is that these tokens can even be traded for cash.
Now, if companies use Enjin to mint their reward tokens, customers can receive the additional benefit of knowing that their NFTs are backed by a digital currency.
Who is the team behind Enjin?
Initially, the company wasn’t involved with blockchain at all, but it has already made a mark in the gaming industry. That same year, the Enjin Network was established and has attracted 20 million users over the course of a decade.
During the cryptocurrency boom in 2017, Enjin raised 18.9 million US dollars in an ICO to develop the most current iteration of Enjin that we know today. Getting more and more involved with blockchain, the platform has helped to improve the player and developer experience, by cutting the middleman of the gaming industry — the distributors.
In 2019, Enjin partnered up with Japanese blockchain company HashPort to expand its network and player market. ENJ became the first cryptocurrency in the “gaming category” to be whitelisted in Japan by the country’s Financial Services Agency.
Japan is known as one of the world’s centers of the gaming industry. The heavy involvement of Enjin in places where gaming matters meant that Enjin has a serious commitment to link up blockchain technology, NFTs, and the creative economy.
Are you confident about Enjin (ENJ)?
Today, 2 billion NFTs have been minted with Enjin. There is a total of 12.4 million dollars locked in all of the NFTs created with the Enjin Coin.
If you’re interested in diversifying your portfolio with ENJ, you can head over to Easy Crypto and order ENJ. We will deliver your coins directly to your wallet without the hidden costs — as easy as that.
Get started: Add Enjin (ENJ) to your crypto portfolio.
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Disclaimer: Information is current as at the date of publication. This is general information only and is not intended to be advice. Crypto is volatile, carries risk and the value can go up and down. Past performance is not an indicator of future returns. Please do your own research.
Last updated January 3, 2023