The Need for Cross-chain NFTs in a Multichain Ecosystem (2025)

Ramani Ramachandran is the CEO and Co-Founder of Router Protocol and Dfyn Network.
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For a multichain ecosystem to thrive and crypto to evolve, cross-chain non-fungible tokens (NFTs) are a must.

In the face of recent events, there’s a lot to be said about centralized, non-transparent entities. We’ve been hit with disaster after disaster over 2022 – the collapse of FTX being the freshest in our minds. People are growing distrustful of crypto and are looking for a remedy.

Amidst the chaos, there’s a sector that’s been gaining massive traction: NFTs. And it’s not just crypto giants like Binance who are showing confidence, but real-life adoption is gaining speed as well. Luxury brands like Gucci, sports icons like Ronaldo, and even social platforms like Reddit and Twitterhave been integrating NFTs at a rapid pace.

There’s a problem, however. NFTs are siloed by singular blockchains while we live in a multichain ecosystem. Thus, there’s a case to be made for cross-chain NFTs.

Multichain ecosystem

Crypto has an abundance of Layer 1 (L1) blockchains.

Some are built to be general-purpose, while others have a specific niche they’re trying to fill. And since they come with different tradeoffs between scalability, throughput, and security, there’s yet to be a clear winner to take it all.

So, it won’t be one chain at the top of the mountain. There will always be different projects that will pick their home based on their specific needs.

Due to these differences, the users, builders, and protocols of Web3 are scattered across chains, forming multiple disjointed networks.

Initially, this idea comes with the problem ofisolation and fragmented liquidity. This obstacle is already partly solved by cross-chain bridgesthat allow you to lock assets on one chain and withdraw them on another.

But, in a multichain future, fragmentation of fungible tokenssuch as ethereum (ETH) or avalanche (AVAX) won’t be the only thing limiting users from accessing other ecosystems.

Non-fungible tokenshave multiple innovative use cases due to their verifiable and trustless properties, but there’s one that’s the natural progression for Web3 communities: digital identity.

Digital identities

We all portray an external image of ourselves online.

And it’s for a good reason. As we’ve progressed to a more digital world, we’re slowly transferring our real-life personas online. Think about social media – we project an image of ourselves on different platforms such as Twitter, Instagram, and even LinkedIn.

That’s your digital identity– a representation of your real-life persona in a digital environment.

We care about our digital identity because, in a Covid world, that was our only way to interact with other people.

Think about the NFT craze of last year – people were, and still are, willing to pay thousands of dollars for a PFP (profile picture) unique and representative of only them. Our avatars in a digital world are essentially our faces.

This is also why people love to buy skins in video games and spend hundreds of hours pumping out content on their socials – to paint a picture of themselves for others to see.

Social media is so popular for the same reason. It allows you to craft a unique persona of yourself online.

However, we have a problem with digital identity in the current state of social media. Your digital identity could be wiped at any time – all of your content, engagement, and connections could go to waste.

This is where NFTs come in: NFTs can be used to store and transfer all aspects of your digital identity.

You want to own your identity – something that is not possible in the current state of social apps.

With the emergence of Web3, we’re slowly transforming the internet into a place where trustlessness and user ownership are the norms.

The need for cross-chain NFTs

If your digital identity is an NFT, it needs to be chain-agnostic.

Like your real-life persona, you’d prefer to take it with you wherever you go.

Were you confined to a single blockchain, the idea wouldn’t work. Communities, decentralized apps (dapps), and games will all be scattered across a wider ecosystem consisting of multiple blockchains.

For a multichain ecosystem to be adequately inclusive, interoperability is a must.

As an example, think about the metaverse. A virtual world that everyone can access. NFTs will constitute an essential link to combine Web3 and the metaverse into one, allowing people to transfer, trade, and utilize things such as avatars, items, and even pieces of land.

Even disregarding digital identity, you could think of some NFTs as a store of value that you might want to transfer to another chain, further solidifying the need for cross-chain infrastructure.

Interoperability infrastructure will provide the foundation for a thriving metaverse. Without it, we’ll end up with similarly enclosed communities as the ones we know now.

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