Dominating Bitcoin in popularity, how NFT gains its massive attention globally
Aesthete, baseball fans, collectors,… are pouring millions and millions of dollars in getting themselves a digital artworks or items that are coded by NFT. In the recent time, along with the popularity of Bitcoin, NFT has become an upcoming trend receiving major attention from many investors.
NFT (Non-fungible Token) is a type of digital asset constructed using Blockchain technology to create unique code that represents an interchangeable asset. These codes are often used to verify digital versions of art pieces, songs or viral trends.
NFT is bought through online auctions and paid with USD or cryptocurrencies. NFT surprisingly becomes a viral trend when there are many digital artworks sold with millions USD and this has made celebrities, CEOs joins the market.
What is NFT?
Non-fungible Token or NFT is a token representing a non-fungible asset. There are two types of assets: fungible and non-fungible. For fungible assets, they can be readily interchanged which is pretty much similar to money. You can pay $100 to someone with 5 bills of $20 or 2 $50 bills. On the other hand, a non-fungible asset is a unique asset and cannot be interchanged in any way. For example, when you buy a flight ticket, you have to buy a whole ticket, not a half or a quarter of it.
Same thing can go for NFT. NFTs are unique digital assets and most of them are paintings, gifs, music, cards and in-game items. Although they don’t have a tangible form of their own, NFTs can be sold, auctioned and bought like any properties.
One of the most famous NFT is a digital artwork called Everyday: The first 5000 days which has been sold for over $69 millions dollars. Another most expensive NFT has been sold is Hash Mask, a living digital arts collectible created by over 70 artists sold with $16 million dollars
A value of an NFT does not lie within items, songs, painting or even Tweets. It lies in the exclusiveness verified by NFT codes. By putting it on Blockchain, the system will acknowledge the original creator or owner of that song, artwork or item. Many theories have been raised about the virality of NFTs. Some may say that big investors pour their money into expensive NFTs to become the exclusive owner of that digital product and sell it with a higher price.
How much does NFT worth?
Ranged from just a few dollars to millions of dollars, NFT can have many forms of an digital asset and have many values. Youtubers, celebrities, CEOs, investors are now putting a huge interest in the NFTs market. Most popular NFTs platforms at the present can be named:
- OpenSea: Founded in 2018 along with the virality of CryptoKitties, NFT is claimed to be the first and largest NFT marketplace for user-owned digital goods. The platform has successfully concluded a raise of $23 million in a round led by Andreessen Horowitz.
- Rarible: A rivalry of OpenSea, Rarible is focusing on building a fully decentralized NFT marketplace. The platform is an Ethereum-based Dex for NFTs and it awards users with Rari Tokens that can effectively operate in a liquidity mining program.
- Enjin: Having operated for several years, Enjin is an NFTs platform trusted by many that allows users to mint Ethereum based NFTs without codes, benefiting game developers by giving them a gateway to blockchain.
CryptoPunks, a project providing more than 10,000 of NFT paintings starting from 2017 has just seen its revenue skyrocket to $45 million a week and these paintings were provided free of charge.
Buying, trading and possessing NFT have potential risks. Most NFTs are traded on ecommerce platforms and even with popular platforms, there can still be fraud. Dan Kelly, CEO of NonFungible states that only make trades with verified traders and the trading of NFTs is like trading on Stock Exchange platforms.
Are NFTs truly worth investing ? Are we in a bubble ?
The fact that there are controversies or arguments over the term “not owning stuff” when it comes to buying and possessing digital assets on blockchain system have raised a question whether NFTs are just a bubble slowly bursting.
“Bubbles” can be considered to be part of the birth of a new technology. There are risks but also future potential. Those bubbles play an important role as a force to influence investment and adoption and accelerate successful outcomes. Digital artwork “Everyday: The first 5,000 days” sold for $69 millions dollars can be copied and pasted on anywhere and everywhere but there is only one token verify the rightful ownership.
Factors define a value of a NFT including: indestructible, verifiable, indivisible and non-interoperable. Unlike other cryptocurrencies, NFT is the one and only and its uniqueness has brought huge profits for many investors.
However, many people cannot guarantee the value of token codes since technology changes and innovates everyday or if owners of an NFTs forgets their password, how can they recover their assets ?
Nadya Ivanova, COO of L’Atelier clarifies that the risks behind NFT are tremendous and it’s very important to acknowledge NFT is maturing and continuing its course into mainstream and to define the true value of something, there are processes needed to be done.
