What is NFTS, and why have they become so relevant?

The pandemic has made it possible to consolidate the importance of content and virtual worlds.  Thus demonstrating that society is ready to start a new chapter based on the decentralization of traditional systems. As a result of this new way of thinking, the NFTS was born. Well, everything that can be represented digitally has the potential to become an NFT, from a tweet or a meme to a work of art.

This post will explain what NFTS is and why this new digital fever is surely here to stay.

What is NFTS?

NFTS (Non-Fungible Token) is a type of digital property characterized by being unique and non-exchangeable. Being linked with blockchain technology, its originality is guaranteed. These digital assets are special, and unlike most currencies, they cannot be exchanged for the same value or divided into smaller values. The cryptography of the tokens allows proving that the owner is the sole owner of the original piece.

NFTS use blockchain contracts ( smart contract ) to create the representation of original content. Which cannot be plagiarized without losing its certificate of originality. No NFT is the same as another. It is characterized by its unique qualities, scarcity, rarity, singularity, exclusivity, and authenticity. Digital tokens often function as a collector’s item, as there is no chance of them being duplicated.

The NFTS market

Non-fungible tokens or NFTS grew to cover a market of 210 million euros in 2020. It is a growth of 299% compared to the previous year. According to analysts, in 2021, the NFT market also grew at a record pace. The main platforms or marketplaces where NFTS are bought and sold have doubled the total volume, reaching almost 420 million euros in sales of digital assets. Experts forecast the widespread adoption of NFTS in the coming years with such figures.

One of the main reasons that can explain this market’s momentum is the interest that NFTS has generated in global companies. Luxury fashion and sports brands such as Louis Vuitton, Nike, the NBA, and Formula 1 actively create and monetize consumer goods and services based on NFTS.

What type of product can become an NFT?

NFTS encompasses various products, including everything from digital artwork (the most common today) and digital fashion items to collectible sports cards, virtual real estate, and video game characters.

A virtual dress closet, a crypto art gallery, a digitized document wallet … The future may be full of non-fungible tokens, which is actually what NFTS is. Recently, there have been several high-profile NFT art sales, with some pieces selling for millions of euros.

What is NFTS for buyers?

Buyers are not looking for the digital asset itself but rather proof of ownership of that digital asset. Tokens are effectively undeniable and can continuously be followed back to the first maker. In this way, NFT token holders can fully own a digital asset, knowing that they own the only token of its kind.

The value of NFTS is based on the immutability of the product. It cannot be destroyed, deleted, or duplicated. The symbol exists just on its local stage, put away on the blockchain network.

Current difficulties in NFTS transactions

To purchase an NFT, buyers must use cryptocurrencies such as Ethereum’s Ether (ETH) or the World eXchange (WAX). Although ETH is one of the most popular coins to buy NFTS, each platform chooses its digital wallet service. For example, WAX is very common in NFT purchases related to virtual characters and video games. Among the marketplaces or platforms with the highest volume of activity where you can buy and sell NFTS are Opensea, Raible, NBA Top Shot, and So rare.

Industrial sectors that NFTS could transform

But… what are NFTS in each industrial sector? NFTS is different in each sector, and in some, they can be a revolution. Among those that experts have pointed out as the most important are:

Gaming Sector

One of the biggest problems in the gaming industry is that when players buy in-game assets, game developers can remove them at any time if they want to. People are spending fortunes on games like Fortnite, but these assets are often owned by the company that created the video game and are stored on their systems. If the company were to go out of business or go bankrupt, users would risk losing the virtual assets they have already paid for.

If the assets of these video games were created on NFTS, users would be guaranteed that their assets would not be subject to the decisions of the video game creators.

Fashion Sector

It seems closer than ever that NFT fashion items will be more important than the ones we have now in real life, especially under the push of augmented reality. Some companies already sell digital clothing as NFTS. This ensures clothing cannot be duplicated and allows brands to create scarcity and exclusivity with their products.

Music Industry

The music industry will inevitably be revolutionized by the NFTS, ceasing to be controlled by record labels, radio stations, etc. They are becoming controlled by their true creator. An example is “Kings of Lion,” which apart from releasing their new album in NFT format. Put “Golden Tickets” on sale as NFTS that contain benefits for life, such as front row seats for any “Kings of Lion” concert. And exclusive visual art pieces representing the band and its legacy.

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