What Is the Risk of “Centralized” Metadata Storage for an NFT?
The primary risk is that the NFT's image or traits could be altered or deleted by the central entity hosting the data. If the metadata URI points to a traditional web server, the owner of that server can change the file, effectively changing the NFT's asset.
This breaks the promise of immutability and permanence that blockchain technology is supposed to offer.
Glossar
Metadata Uri
Attestation ⎊ Metadata URIs, within the context of cryptocurrency derivatives and options trading, function as cryptographic attestations of data integrity and provenance.
Metadata
Provenance ⎊ Metadata within cryptocurrency, options trading, and financial derivatives establishes a verifiable history of an asset’s ownership and transaction lineage, crucial for regulatory compliance and risk mitigation.