Unlike typical ERC 721 tokens where a Smart Contract allows the creation of multiple tokens, Smart Contracts of data NFTs allow just one token per contract. Therefore, a Factory Contract serves as creator of a number of custom contracts which may have each one token minted at max. This architecture allowed the custom contracts to have individual rules, which provides a lot of flexibility compared to the traditional architecture.
The following graphic illustrates the Factory Contract, which serves as creator for several custom contracts (need to be registered first) that are bound to a data NFT.
A further notable difference to classical NFTs is that data NFTs don't make use of external storage solutions like IPFS. Data NFTs use on-chain meta-data, which has the advantage that meta-data remains persistent due to the nature of the blockchain. Nevertheless, it comes with the disadvantage that on-chain storage space is limited and costly.