You’ve got to be kidding me! There’s something like this out there in the world, and it’s worth millions- my first reaction to a news release on television.
The object of my momentary disbelief was the ‘NFT’, short for Non-Fungible Token.
Months have passed, and I am curious about the fate of this new digit asset?
This blog is a (supposed) culmination of my research. My views should therefore be interpreted with caution. However, there are abundant facts that I will share with you.
I am of an inquiry mind and I have an acute strain of the FOMO as I embark on this path to discovery and unveil enlightening issues – Hopefully refraining from anything captious.
There’s so much going around this stuff, you could set up a news channel for the NFT.
What I truly love about it is the unbound imagination that it presents. But first –
What is it? And why is non-fungible?
Unlike bitcoins or cryptocurrencies, NFTs are non-fungible, meaning – they cannot be interchanged. It’s like a trading card that can’t be traded for another card. An NFT can be described as a rendition of a digital certificate of ownership for a virtual asset. Built on blockchain technology, it contains a record of who owns what is stored on a shared ledger.
The NFT is also unique because the original creator (copyright owner) can create more NFTs of the work already sold. But each copy remains different. NFT ownership is easy for anyone to verify.
The first NFT goes back to 2014 when Kevin McCoy and Anil Dash.
They became popular with the game ‘CryptoKitties’ allowing players to buy and breed virtual cats that were unique. Their popularity has gained momentum in the past few years.
According to a report by nonfungible.com, over $2 billion was spent on NFTs, during the first quarter of 2021.
NFT this and NFT that
Baseball cards, unapologetic memes, artworks, animated characters of video games, pieces of cultural history, and collectibles can be tokenised. And, if you notice older pieces have a better price than others.
(Nyan Cat)
Instances of NFTs that have raked in the dollars recently –
| NFT | WHAT IS IT ? | SOLD FOR |
|---|---|---|
| Charlie Bit Me | The clip of baby Charlie biting his brother Harry’s finger. Earlier popularized by a YouTube video in 2007 that garnered 885 million views | $ 538,000 |
| Disaster Girl | The meme of a young girl aged 4 in front of a burning building. The girl has a charmingly unusual expression | $ 500,000 |
| Nyan Cat | A meme of a popular 2011 YouTube video of a pop song merged with an animated cartoon cat | $590,000 |
| ‘Deal with it’ sunglasses | The famous meme that gave users access to a template that they could use on images | $22,000 |
| Everydays – The first 5000 days | A composite of 5000 daily drawings by Mike Winkelmann, famously known as ‘Beeple’ | $ 69.3 million |
| Le Bron James Slam Dunk | Video of the famous basketball star dunking | $ 208,000 |
| Jack Dorsey | Twitter founder’s first ever tweet | $ 2.9 million |
| CryptoPunks | A collection of 8bit style pixel art images of quirky characters | $ 11.8 million |
| Genesis | A pencil and ink sketch coupled with an oil on canvas painting of batman (one of a five-part collection) | $ 111,377 |
| Gucci Ghost | Gif of a ghost-like graphic with hand-drawn Gucci logo | $ 3,600 |
| Fyre Festival logo | The infamous festival’s logo | $ 122,000 |
| Mars House by Krista Kim | Falls under the digital real estate space. The Mars house has a scenic view of mars from this imaginary house | $ 500,000 |
| Finite by Pak | A 3D rendered ever morphing object | $809,789.40 |
| Blake Kathryn | A vibrant depiction of seasons with uniquely displayed rooms | $ 22,938.19 |
| Kings of Leon | Music from the Rock band | $ 1.4m |
| Overly attached girlfriend | Meme that surfaced from a video by Laina Morris | $ 411,000 |
| Doge | Image of a Shibu inu dog | $2.8m |
| The EverLasting Beautiful by FEWOCiOUS | An original canvas painting by the anonymous artist | $ 550,000 |
| Hairy | From the digital art collection of Steve Aoki and Antoni Tudisco | $888,888.80 |
| Forever Rose | Photograph of a rose by Kevin Abosch | $ 1 Million |
| Sir Tim Berners Lee | 1000 lines of source code to the original web browser | $ 5.4 million |
The digital artforms can be anything – Thinkism, Alter modern, Mass-surrealism, Neo-futurism, any other. We will see many unique artforms down the road with NFTs.
Pricey OR Price-less
The question that we all ask is whether NFTs are legit? This is a difficult one, but let’s look at factors that present a favorable case for NFTs.
The emergence of trading platforms or marketplaces in the recent years is a hassle-free way of buying and selling NFTs. OpenSea offers a diverse range of NFTs – from art, collectibles to trading cards. The platform allows you to buy, sell and create digital assets.
Another NFT marketplace is Nifty Gateway which has three different auction mechanisms – Buy it now, timed auctions and silent auctions. It provides artists with around royalties from secondary sales of their work. Other NFTs marketplaces include – SuperRare, Mintable, Rarible. With buying and selling often, a unique identifier gets encrypted into a NFT, thus indicating ownership of the NFT. On a platform, anyone with access can view this ownership information, however no one can access the actual token without the owner’s cryptographic key.
Brands have joined the band wagon. Mattel creations has put up for sale digital art versions as NFTs of the Hot Wheels classics – Twin Mill, Bone Shaker and Deora II.
Nike introduced Cryptokicks – where a custom shoe can be created by breeding two NFTs. Sounds bizarre, but it’s like this. Combine the parts of sneakers that you love and produce a design that is exclusive to you. Taco Bell, among the first, sold 25 pieces of crypto art on the NFT platform Rarible. Brands will invest in NFTs to harness their goodwill and produce some great memorabilia.
(Taco Bell)
NFTs will take time to mainstream and there are questions hovering around critical issues. The important one being the carbon footprint they generate. Not all governments are on the same page on NFTs, and regulations around the buy, sell and ownership are very nascent.
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