NFTs! What’s the hype ?
Non fungible tokens are being talked about everywhere at the moment. Kylie Jenna tried to buy one, Nike are making their own virtual sneakers, Snoop Dog is in the action and it seems the digital world is exploding!
NFTs are exciting, they are seemingly the future of gaming, digital art and future event ticketing that exist on the blockchain. Being on the blockchain allows these tokens to be exchanged, bought, and sold with complete transparency. You can see where it came from, how much it has previously sold for and with a quick scan of a QR code, you can verify the true owner of the NFT. Another fantastic fact about these, is that, with the use of smart contracts, the original artists can retain royalties, set up a fund for a charity, social event or future project allowing the NFT to gain additional value to a traditional piece of digital artwork. And it looks like this new craze is exploding- NFTs for artists, is going to be where it’s at!
But what are they ?
Well firstly, let’s have a look at non fungible tokens, what does this even mean?
“Non-fungible” means that the token is not interchangeable. For example, you have a $10 note, you can exchange this for 10x $1 notes and this will be the same as your initial $10 dollar note. Non-fungible tokens are unique, they cannot be exchanged for ‘like for like items. Yes, sure you can exchange them, sell them for cash, but it will not be the same as the unique artwork/token. Like a digital style Mona Lisa! It is not exchangeable in that sense, and cannot be replaced. Each token is individual, unique, and non-replicable, since it is attached to a QR code which is a specific to that NFT. That’s why you may have heard of people spending huge sums of money on nfts assets like cryptopunks, bored apes, they are one-offs and totally exclusive.
How do they work?
You can buy them on a number of platforms, the most popular is Opensea, but there are others such as Rarible, AlphaArt and others are cropping up all the time. At the moment most NTFs are bought and sold in Eth (Ethereum’s currency), but there are also other blockchains such as Solana and Polygon which allow NFT purchases and trading. You will need to set up a wallet so that you can store your NFTs safely. The most commonly used wallets are metamask and coinbase, but again there are others, and it’s worth checking them out to decide which is the most suitable for you.
What’s the hype and why would you spend money on them?
Why are people going crazy for NFTs, and why would you buy a piece of digital art?
These are many reasons for this. Many are jumping in on the act to sell, buy and flip these assets, as well as building up a portfolio of digital art or NFTs which hold longer term value.
As a digital artist, it’s a innovative way to showcase and sell your art. With the initiation of smart contracts, artists can make ongoing royalties every time the art is sold on. This allows creators to fund and create future projects- think music, film, and art projects. Via the use of smart contracts, NFTs have the ability to incorporate future endeavours. One example of this is the project: Women of the world. Not only does the original artist receive royalties every time the art changes hands, they can also include a percentage to go to directly dedicated womens charities, giving NFTs the ability to help and support communities in a much wider context than ever before. One of my favourite types of this kind of project is Untamed elephants, whose mission it is to raise money for these beautiful creatures through the sale of NFTs! How cool is that!
For the buyer or owner, these tokens or pieces or art or music encourage community, can serve future utility, such event access, giveaways from the creator and access to future projects, adding value to the token itself and incrasing its price over time.
It’s a super exciting space, with so much possibility for the future!
