NFTs (non-fungible tokens) — or scarce digital content represented as tokens — are driving a new wave of crypto adoption.
Thanks to the Ethereum blockchain, artists, game companies, and content creators alike use token standards that attribute provenance to uniquely no fungible assets. NFTs first made headlines in 2017 when Dapper Labs’ game CryptoKitties accounted for 95% of Ethereum network usage at its peak. While someone paying $170,000 for a digital cat seemed like an anomaly, what’s happening today blows that headline out of the water.
Just as we’ve seen an alternative asset class form around physical collectibles like Pokémon cards, NFTs are starting to show what this universe of rare brands looks like online. Polkamon’s, which represent NFT’s similar to Pokemons, have been around for a week.
Big markets, like the gaming industry, will incorporate more and more NFT’s into their games. For example, in the future, gaming games such as World of Warcraft, Counter-Strike, or Monster Hunter by Capcom will use NFT’s. How are NFTs used here? Basically, you invest gaming time to get an NFT. You can then sell it on OpenSea.
Niche collectibles like CryptoPunks — which are 10,000 unique collectible figures with rare features and characteristics — now have a base price of around $18,000 each. Just recently, Punk 4156 sold for 650 ETH, which equates to about $1.3 million at today’s prices.
With NFT’s in the gaming space, there is an implicit contract that what you buy is unique. There is only one of these tokens, and the only one who has the right to use that token is you. This allows you to create unique weapons, armor, and accessories in gaming, and you can even earn money with it! A new way to live to game.
Many people will be able to build up a side income and live off it later.
Therefore, every amateur gamer can earn money with gaming and not only the professionals.
It still seems hard to get used to the idea of spending money on nothing tangible. Would anyone pay money for NFTs that say they “own” the Brooklyn Bridge or the entire earth or the concept of love?
People can create as many NFTs as they want, about anything, over and over again.
You could theoretically create your own NFT claiming to own the Mona Lisa and record it on the blockchain, and no one could stop me.
Graphic designers and 3D designers find new platforms to showcase their work, with marketplaces like SuperRare enabling sales of exclusive digital art. Mad Dog Jones recently set a record for art worth $3.9 million in one sale, beating the previous record held by Beeple with his Everyday 2020 Collection for $3.5 million. No wonder top art galleries like Christie’s are asking to collaborate.
With Bitcoin and Ethereum reaching all-time highs and investors looking for new places to invest their capital, the crypto-art movement has given power back to creatives.
Musicians such as Linkin Park’s Mike Shinoda and Fort Minor have released NFTs as part of their strategy for his new single “Happy Endings,” featuring pop star Iann Dior.
NFT as Lending Collateral
Hoard is about to launch its solution where users can define their fungible assets’ value, and then credit protocols that accept NFTs as collateral will be used.
The lending protocols, i.e., the NFTs themselves (e.g., ERC-721 tokens), will accepted as collateral. Using Hoard, NFT’s can then be lent, and for the duration, the lender gets rewards through the HRD token.
The advantage of this is that the lender can use the functionalities of NFT (e.g., in-game). Also, a lender can earn additional money by renting out the NFT to third parties or collecting the profit that the NFT generates (e.g., rent if it represents ownership of a virtual weapon).
NFT Future Madness
What’s coming next?
Maybe the conversion of a luxury car into a non-fungible token, who knows.
Luxury watchmaker or Breitling issuing digital certificates on the Ethereum blockchain. Many things are possible with NFT’s. In every conceivable area, NFT’s can be used. Most potential in the gaming industry and the art and music industry. Many platforms, such as Hoard, which run on the Ethereum chain, offer the masses opportunities to earn money with NFTs in the long term.