Many of the biggest cryptocurrency enthusiasts have always envisioned a fair way for the creative minds of this world to be paid. The value of digital assets has been soaring as of recently, much higher than it ever has throughout our history, and as such, this has allowed a lot of artists for new ways of monetization.
You may be wondering, why artists, and what does this have anything to do with Non-Fungible Tokens?
Non-Fungible Tokens: What You Need to Know
NFTs have been associated as becoming the future of collectibles, and some of them are worth millions of dollars. They have the ability to represent just about anything, and one of the main reasons why they are sought after is because of their scarcity.
Not a single NFT is the same as the previous one, and each of them holds as much value as we the buyers give them. Some are much rarer than others in terms of how they look, and what information they store, and this is what can make them a lot more desirable.
Non-Fungible tokens are crypto assets that are indivisible and unique, that can be used to represent both tangible as well as intangible items. They originally launched on the Ethereum blockchain and were ERC-721 tokens. However, over time they found their way to a lot of other different blockchains. This gave NFTs access to a lot of use-cases, and many of these were in the form of digital collectibles, artworks, and in-game assets.
This is due to the fact that the tokens themselves contain information that is recorded in their smart contracts, and as such, this information is a completely unique aspect of each NFT token. They cannot be replaced by any other token as a result of this functionality. Fungibility is the currency’s ability to maintain a standard value and a uniform acceptance.
NFTs have mainly grown in popularity due to the fact that they have the ability to tokenize just about anything and provide a way to transfer ownership of digital assets to holders.
Now, previously we mentioned artists, and this is due to the fact that NFTs are most commonly perceived as pieces of art, and no matter how unique this sounds as a concept, they are associated with the power of their creative expression that can be set in a tangible medium.
This is due to the fact that when you decide to purchase an NFT token through the usage of a FIAT currency, or cryptocurrency, you are purchasing the unique token, as well as the work of art that is connected with it. This transaction is registered on the blockchain and provides a record of this purchase, and proof that you have ownership over it. They are non-interoperable, indivisible, indestructible, and even verifiable tokens. All of the data is stored on the blockchain through smart contracts, and this means that neither one of the tokens can be destroyed or removed, or even replicated. Their ownership is simply immutable, and the original creator can be traced back at all times.
Where are NFTs Available
Ethereum is the leading blockchain service for NFT, however, there are others that are gaining speed in terms of popularity.
NFTs are currently available on the following blockchains:
- Flow by Dapper Labs
- Binance Smart Chain
Keep in mind that each blockchain has its own separate NFT token standard and a compatible wallet service as well as the marketplace.
Real-World NFT Usage
The latest sale of NFT was at around $69 million NFT sold the artist Beeple, for something that only exists digitally.
Grimes, which is an EDM concept artist, sold $5.8 million worth of NFTs at the end of February, and a lot of other music artists followed suit.
Steve Aoki sold $4.25 million worth of NFTs as-well.
There are also these NFTs known as Crypto Punks, and CryptoPunk #7804, which is a computer-generated avatar of a teal-colored, pipe-smoking alien wearing a hat and sunglasses, ended up getting sold for 4.200 Ethereum, which equates to approximately $7.5 million at the time of writing.
How Non-Fungible Tokens Are Shaping the Crypto World
Currently, a lot of NFT platforms have started to pop up. All of them have one main goal, which is quite honorable when you think about it, and this is to bring back control to creative freedom, as well as provide monetization options for artists.
Imagine your favorite artist out there, this can be any form of artist, a streamer, a YouTuber, a digital artist, maybe a musician, well, what if all of these could transfer their art into NFTs and sell them online. These exchanges allow for fans to fully support their favorite artists, through donations, or simply through the purchase of their art in the form of NFTs. There have been numerous rich people out there who have already spent millions of dollars on NFTs, and this has been especially present in many of the online games that use this kind of technology.
There have been games that make in-game items, mostly cosmetic, NFTs that can be purchased with real cryptocurrencies, and players can even generate their own NFTs in-game and sell them or trade them on exchanges. NFTs essentially provides a whole new way of monetization, and allow any artist out there to have a way to express themselves, and be valued for it.
Any interested user can go to a dedicated platform, the most common ones being OpenSea and Rarible, and upload the file that will become an NFT. The Fees are typically around $30 per file, and this is paid in cryptocurrency. Once the NFT is on the platform itself, the creator has the ability to sell it. The creator can then set a percentage that they want to receive from all future sales of the file.