NFT (…yeah you know me)
NFTs (Non Fungible Tokens) are digital certificates that authenticate a claim of ownership to an asset, and allow it to be transferred or sold. The certificates are secured with blockchain technology similar to those that underpin Bitcoin and other cryptocurrencies.
The key difference between NFTs and cryptocurrencies is that currencies allow fungible trade, which means anyone can exchange Bitcoin for other Bitcoins. NFTs are by definition non-fungible and are deployed as individual claims of ownership to a specific asset. NFTs are designed to uniquely restrict and represent a unique claim on an asset — the value of which is not commonly understood but instead unique to whatever the buyer/seller agree it to be.
You may be aware of NFTs following the hype explosion that happened within the last year — the pinnacle of this being ‘ Beeples ‘Everydays: The first 5000 days’ which sold at Christies for $69M. Consensus ranges on this and I will leave it to you to decide — after all, thats what Art is about, no? However — NFTs are not just Artwork, they are so much more and they will surely come to underpin a huge amount of value going forwards.
Music, Gaming, Insurance, Mortgages — all can feasibly be NFTs in the future.
Focusing on Music we have the possibility for artists to sell their music direct to fans by the issuance of a limited number of NFTs — with the NFT being an asset consumers can then sell this on again should they so wish and there are two things worth noting here — 1. the Artist is selling direct to the consumer, no middle man & 2. The consumer now has an asset they can sell. Having seen streaming services turn the Music world upside down and not in favour of the creators or consumers, (Artists receive 0.001p per stream and consumers no real ownership) NFTs give the possibility to flip it back again. Imagine JayZ releases just 1000 copies of an album and then sells these direct to fans as NFTs — how much would someone be willing to pay? How much would the secondary market be prepared to pay??
I mention Jay-Z as he very recently changed his Twitter profile picture to a NFT; Cryptopunk #6095 ( sold for 55 ether or $119K using today’s exchange rates) and is partnering with Sotheby’s to sell an NFT based on his 25-year-old album “Reasonable Doubt.” Artist Derrick Adams has been commissioned to animate the NFT, called “Heir to the Throne — it appears clear, to me at least, the direction of travel here.
With regards to Gaming — the game itself & skins, weapons, dances — all can potentially be issued and bought as NFTs and the principle remains — it would allow the consumer to sell on again — something not possible in todays digital download economy. Any money spent in Fortnite, for example, can not be retrieved — how much would a super rare skin be worth? Ultra are a platform looking to bring this to life — and with their Mainnet now released, combined with partnerships including AMD and Ubisoft, they are very well placed to do so.
The ability to remove the middle man and afford artists and consumers rights over their digital assets is another facet of the revolution set to unfold — we have the makings of a new sector of the economy and to my mind NFTs are a perfect application of Blockchain technology, serving to afford rights to people that should have them and therefore stand to improve things for the majority of people.
The future is decentralised TH
For reference; Popular NFT Marketplaces
* OpenSea.io: This peer-to-peer platform bills itself a purveyor of “rare digital items and collectibles.” To get started, all you need to do is create an account to browse NFT collections. You can also sort pieces by sales volume to discover new artists.
* Rarible: Similar to OpenSea, Rarible is a democratic, open marketplace that allows artists and creators to issue and sell NFTs. RARI tokens issued on the platform enable holders to weigh in on features like fees and community rules.
* Bondly: State that their aim is to be powering the next generation of digital collectibles with crypto projects, brands and artists.
Originally published at https://www.thehodler.net on June 30, 2021.
