Closed Policies

Time-locked mint policy, a.k.a. a closed policy, is a policy which allows for minting and burning of tokens only until a specified time. This predetermined expiration is set during the creation of the policy, and once reached, no further alterations can be made to the tokens under this policy. After the policy closes all its content becomes immutable. This creates a fixed, unchangeable supply for your collection.

Why Use Closed Policies

Closed policies are particularly useful in contexts where the scarcity and originality of tokens are important. By ensuring that no additional tokens can be created beyond the deadline, closed policies provide collectors with assurance regarding the total supply of the asset. This can be crucial for artworks, limited edition collectibles, or any digital asset where value is derived from its rarity.

Managing and Trading with Closed Policies

While closed policies restrict the minting and burning of tokens, they do not limit the trading and transfer of these tokens. Owners can buy, sell, or trade their assets on marketplaces that support Cardano assets.

Potential Use Cases for Closed Policies

• Limited Art Collections: Artists can release a limited series of digital artworks, ensuring that only a fixed number of pieces will ever exist.

• Limited Edition Collectible Drops: Closed policies are perfect for strictly limited collections.

• Special Commemorations: Create NFTs tied to a specific event or time period, with a limited supply preserving their uniqueness.

• One-Of-a-Kind Creations: Use a closed policy to prove that an NFT is truly the only one of its kind.

• Experimental Art Projects: Where the final form of the project depends on a set, unchangeable supply.

• Event Tickets: Event organizers can use closed policies to issue a set number of tickets, guaranteeing exclusivity.

• Gaming Items: For digital games, items like special weapons or costumes can be minted using a closed policy to maintain item rarity.

Technical Implementation

Minting services and tools offer options for creating closed policies. Implementing a closed policy involves defining a timestamp in the native minting script, which acts as the cut-off point for minting activities. Any transactions that attempt to mint or burn tokens after this timestamp will be automatically rejected by the Cardano blockchain. Be aware that there's no way to undo this process later.

Key Points:

• Closed policies offer the strongest possible guarantee of rarity. Buyers know the exact maximum supply, making the NFTs more collectible.

• Choosing a closed policy means giving up control over your collection's supply. Make sure it aligns with your vision and goals before committing.

• Closing the policy can happen right after the initial sale, after a set time for additional flexibility, or even be tied to a specific event.

• Once closed, the number of tokens in the collection is permanently fixed.

Conclusion

Closed policies are an essential feature within the Cardano ecosystem, offering creators and collectors a dependable way to manage the authenticity and exclusivity of assets. By making use of time-locked mint policies, creators can ensure that their works remain secure and limited in distribution. Closed policies offer powerful advantages but require creators to think carefully about their long-term goals.  If you have any doubts about potentially needing to add or remove NFTs from your collection in the future, an open policy may be a better choice.