NFT may represent works of art, collectibles, souvenirs and personal data. It can also be a game character, crypto identity, certificate, etc. so is NFT worth the investment let’s refer to the article.
The coding case is relatively simple. When we tokenize commodities (such as currency or gold), it allows them to be traded around the clock through borderless and frictionless transactions. These tokens, like the underlying objects, are interchangeable. A gold bar can be replaced by another gold bar of the same mass; bitcoins can be replaced by bitcoins.
However, heterogeneous goods are irreplaceable, unique and limited in quantity. They can also be represented on the blockchain through non-fungible tokens (NFTs).
NFT Use Cases
Heterogeneous tokens are generally not divisible. However, there are several projects in development that are partially owned. Split Ownership (F-NFT) will be an investable retail investment of $20 million in art value invested by the NFT of $1,000 on behalf of the work.
By using smart contracts, creators can establish new sources of income, such as royalty payments. For example, smart contracts for tokenized artworks could force a certain percentage of sales to be sent to the original address. Artists, musicians, and other creators may find that in addition to initial sales, royalties are paid regularly.
Just as small trades increase the liquidity of the commodity market, we can expect a similar situation in the rare commodity market. Feel it: the size of the global collectibles market is $370 billion. The global video game market is US$151 billion; the art market is US$64 billion; The crypto identity market is 13.7 billion US dollars.
Can NFTs boost finance?
Will we see the world’s poor join the ranks to invest in Picasso? It may not appear on a large scale. Although it is technically possible, the poor may not be able to “save”. While Bitcoin is a highly liquid and inflation-reducing asset that can be helpful, a partial ownership stake in Picasso might not be everyone’s first choice. .
But this doesn’t mean it can’t happen.
There are a number of case studies that show a way towards creating value and utility. An art teacher in Africa can invest in high value paintings on a small scale and keep an NFT (value added) as a legacy for her children. Competitive video game players can monetize unlocked rare characters by selling NFTs to fans in Asia.
Is NFT still in the spotlight?
NFT brings advanced security and certification to the market. When conducting business, trust is essential and blockchain – independent of third parties – can increase transactions and commercial activity in risky markets.
A blockchain can always capture the originality of collections; track items; create an operational and legal chain of custody; and document the sequence of control, ownership and transfer of the shard. Depending on how the creator designs the application of the intended use case, a chain can also record a history of heterogeneous assets; add timestamps for key events; and listing auction prices and other verification information.
However, when it comes to crypto artwork, although people can hold NFTs as proof of ownership, it is of course very easy to copy artwork. Some may ask, since anyone can download “images” for free, what is the point of holding ownership?
However, in a verifiable social network, “ownership” is indisputable, and even if there are duplicates on the network, the value of this NFT is unique. The reality is that people value authenticity.
Especially when dealing with famous or controversial pieces, there will always be collectors willing to pay the price. Is NFT worth the investment? Having said that, few would disagree that the NFT sector is currently overheating and we can expect continued volatility in the sector over the next few months.
However, we believe that NFT will play an increasingly important role in the transition to a crypto-environment where trust, verifiability, and cryptocurrency sovereignty are at the core.
Important Note: All content on the website is for informational purposes only and is not investment advice at all. Your money, the decision is yours.