What’s skyrocketing faster, the price of Bitcoin or the explosive growth of NFTs? Every aspect of the cryptocurrency space is booming right now like Bitcoin reaching ATH of $50-60,000 and non-fungible tokens (NFTs) auctioned for millions. It’s the perfect time to learn the basics so you don’t miss out.
Before you pass judgement on the insane prices and constant noise around collectible tokens, you have to appreciate that, ostensibly, they represent the confluence of culture and e-commerce. The NFT rage centers around the ancient human psychology of collecting things and for people who collect, the value of their collection is not measured in fiat, but tied to emotions. Collectibles connect people to their childhoods, memories, and the energetic thrill of a quest to hunt down an item that represents something incredibly satisfying to them. It is also a sort of portrayal of themselves and the “community” they wish to identify themselves with who are like-minded and fascinated in similar activities or objects. How can you argue with that?
The digital advancement in collectibles is game-changing. NFTs are unique cryptographic assets that can be used to authenticate ownership of things like artwork, recordings, virtual real estate, pets, collectible sports cards, domain names, event tickets or pizza (yes, virtual pizza, I’ll get to that later). These tokens are a digital “certificate of authenticity” of artifacts. Collectibles. Non-fungible means that it cannot be replaced with something else. If stored on Ethereum’s public blockchain (that’s where most are), anyone can track it’s creation, sale or resale. The ability to create or “mint” a unique digital item on a blockchain allows people to own, manage and monetize within perimeters set in code.
How can creators and owners benefit?
Let’s start with the notion of decentralization and how everyone benefits from having more open and transparent platforms like the media. The old paradigm of big companies curating content for the masses and controlling distribution has shifted to individuals choosing what they see when they want to see it and curating and controlling content for anyone to access. Blockchain technology is decentralized and therefore the use of the technology in NFT minting inherently changes old systems in digital ownership, rights and distribution. Creators and owners no longer need intermediaries for permission to own, create, share, buy or sell. Simply put, creators/artists can retain rights and capture revenue without a middle man by selling direct and coding the “rules” around the sale.
NFTs are smart contracts that self-execute programmable code. Imagine a self-published singer bootstrapping a new album. She can program NFTs to have features that pay her a percentage every time her song changes ownership. She’ll continue to realize profits long after the first sale. In the case of concert tickets, an artist can put a cap on the number of times a ticket is resold or take a percentage of the resale. Athletes issue limited edition collectible cards (1, 5, 20, whatever amount) and guarantee authenticity and immutable provenance. The creator can dictate the terms with unprecedented specificity and control! But all this costs something. How much? NFT prices are not obviously based on inherent value (like Gucci sneakers are not priced on just the cost of materials) but its value determined by demand and the creator behind it. In case you are the sporty-type, Nike has patented a method to verify sneakers’ authenticity using an NFT system, which it calls CryptoKicks.
For owners of NFTs, benefits include portability, traceability, community affiliation, and in some cases, profits. Rare Pizzas which I discovered in a Clubhouse room this week, is for pizza lovers who are buying thousands of dollars worth of “Pandemic Pie”, “Doughfellas”, or “Gotta Sauce ‘Em All” then tweeting or switching out their profile pics with their personalized pizza. Owners and developers meet up on social media platforms to riff on the novelty of it all, new ideas, and scoop on the artists. It launches art ownership into a different realm.
NFTs in Mainstream News
It’s hard not to have a reaction to the recent NFT auction at Christie’s legendary auction house where Beeple’s digital compilation of images representing 5,000 days sold for a whopping $69m dollars. Many artists such as Calvin Harris, Halsey, and Illenium are issuing limited NFTs to fans while Elon Musk is selling this song about NFTs as an NFT.
You can explore NFTs using your native Opera wallet embedded in the browser through Dapps such as Rarible, Opensea, SuperRare and NFThub to name a few. Create your own in Cryptopunks or Mooncats and trade. Tag #Opera when you tweet your creation and we’ll be sure to like it!