As you must have seen or heard, people have been selling assets and other private valuables as NFTs. Recently, someone was in the news for selling a piece of digital art as NFTs for up to $6 million. Yes, that’s right! Now, we’re seeing news about people paying house-money for clip art of rocks.
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The rise of this new fad has also led to new coining of the word NFT gold rush. The fad has been growing slowly for some time with not many people paying attention to it. All of a sudden, it is a big deal in 2021!
But what exactly are NFTs, and how can one profit from them?
What are NFTs?
You have probably gone online and seen that it means Non-fungible token. The creators claim it means something that is unique and can’t be replaced with any other material or thing. It isn’t exactly the same meaning as the non-tangible tokens.
It contains the owner ID, rich metadata, safe file links, accompanied by other identifying information that has been recorded in the smart contract. This information makes each NFT unique and exchangeable.
When you first saw a Non-fungible token, you may have mistaken it for a cryptocurrency. In this world of blockchain technology, anything can happen, and that means you may not be further from the truth.
So, if a bitcoin is fungible, that is, you trade one bitcoin for another, in this case, NFT is the same. It is a neo-trading card. What are you giving up? A horse painting? What will you get in return? A unique digital token living on a blockchain? It is bigger than the imagination!
In short, NFTs allow art buyers to support artists. It looks like only the most popular artists stand to gain a lot from these transactions. Buyers also get something or a couple of things in return.
For one thing, NFTs are seen as speculative assets, although buyers may not be able to hang their digital pieces on their walls. What many buyers get is the bragging rights for the purchase. But being speculative assets, several marketplaces have sprung up, in which people can resell these digital assets.
How NFTs work
Most NFTs are part of the Ethereum blockchain. Since Ethereum is a blockchain like bitcoin or dogecoin, its blockchain supports NFTs. Yet, NFT stores extra information in a way that other blockchains don’t. Even though Ethereum supports Non-fungible tokens, it works a bit differently from the coin. More blockchains can also find a way to introduce their own NFTs.
Tron has done that last year when it released its own NFT standard TRC-721. It is hoped that the creation of it would help the Chinese centric blockchain realize various distributed ledger technology-based apps because it still needs to keep up the pace with Ethereum’s growing NFT sector.
What can you buy at the NFT supermarket?
NFTs can be anything seen as a digital asset. They could be a piece of art like drawings, someone’s brain downloaded into an AI or even music. The founder of Twitter succeeded in selling one of his first-ever tweets for just a little bit lower than $3 million. People have started to use technology to sell this art collection.
Is This Art Collecting?
This has not been attested to yet, but the future is leaving everything open to a lot of possibilities. But who actually will do the collection? Right now, anyone online could just right-click, and save or download a piece of digital art that someone else had paid millions for. Maybe it won’t work for all NFTs but some have been downloaded by hundreds, if not thousands of internet users worldwide.
It goes without an argument that even if copies of your work are made, only you retain the copyright. It doesn’t mean that if I copy or download a Mark Zuckerberg picture from the internet, the copyright belongs to me. The same can be said about NFTs.
Put in the terms of physical art, anyone can recreate the Monalisa, and people can buy, but only one person has the original in possession.
NFT: What’s in for an artist?
As an artist, do you have something unique? Do you have something that may not sell in the regular art market? Have you designed a really cool digital sticker idea? Do you think it can sell in the NFT market? You may want to try to sell it but remember, it is better if digital art can grow in value.
NFT: What’s in for a buyer?
It is the move you make to support an artist you like financially. When you buy, take note of the usage rights bestowed on you. Can you post the image online and use it as your profile picture? You must be able to hold the bragging rights that it belongs to you. For that, you need a blockchain entry to back that up.
But who are these buyers? Those who buy fall into various categories of people, although they are just one class of people: The super-rich citizens. Some of them see the NFTs as art collecting replicated, others treat them like Pokémon cards. There is more to that, anyway. For who in this world would agree to pay hundreds of thousands, even millions for something so simple as a trading card? Some of these mega-rich buyers are said to view these as a playground.
However, sometimes, what makes the pay worthwhile is that when the NFT is associated with a popular icon in music, movies, or sports, it is indeed a big deal. A good example of this is the Logan Paul Pokémon card.
Who is launching their own NFTs in 2021?
We have already seen NFTs launched by artists, such as actors, and other popular celebrities. Big companies have already started launching their NFTs. These include companies such as Marvel. This means that NFTs may seem to be showing some more power as time goes by.
The Verdict
I believe the verdict is different for everyone. Those who sell and forget, and those who buy and hope to sell for higher in the future will have different verdicts for NFT’s future. Yet, it is important to anticipate what the next generation will make of the NFTs.
At the present time, there are teens who are profiting from the sector. For some of these youths, NFTs are a way to get used to working on a project with a team, or just another way to make money that should be spent in return.
