NFT FAD is in the air. Art worth millions of dollars are being bought as if it's free. This NFT bubble gave artists opportunity amid the crisis, and while NFT gave artists control over their work, a lot of fake copies of masterpieces swirled around the internet.
The value of Art lies in the eyes of the beholder.
I’ll say we got to see the above phrase in action, thanks to NFTs.
Let’s look at what we will discuss-
- What is an NFT
- NFTs for our digital identities
- Market of everything
- Birth of new businesses
If you are still wondering, “what the hell is even an NFT?” Well…
NFT stands for Non-Fungible Token. Let’s break it down.
Non-fungible assets have unique qualities that give a unique value to each good; ex- diamonds, cards, used cars, art, have a unique value. We can derive this value from qualities such as age, color, location, size, condition, depending on what good we are talking about. On the other hand, fungible goods such as notes, stocks, commodities have equal value. All $1 American notes have the same value: $1, no matter how old they get, they will be worth $1, but diamonds have different values based on size, cut, etc.
Now let’s look at the ‘token’ side of the equation.
We can take these non-fungible goods, create a digital representation of them, and then sell them online. This is called tokenization. So, let’s say you have some digital item like an image, video, logo, or anything. You can use websites like Opensea or Rarible, upload them there, and ‘mint tokens’. These tokens live on a blockchain, thus each one of them has a unique hash that gives them a unique identity and proves their authenticity.
You can mint multiple copies of the thing and decide on their rarity.
Ok, I assume you got a basic understanding of what NFTs are. We will now look at more applications of NFTs.
Reputation/ Digital Identity/ Credentials
After watching a spy or a hacking movie, did you ever asked yourself — how cool it would be if I could be anonymous? Well, I feel that all the time.
But!!!! there’s always a but. What about your credibility and social reputation?
If you are a content creator, artist, or anyone who values your number of followers, likes, etc; you know we cannot transfer them. In sites like Reddit, where your karma and awards mean a lot, you cannot transfer them from one account to another, let alone to any other social networking platform.
So, let’s say if you have a million likes on YouTube, you have definitively amassed some trust and reputation. If you decide to post content on some other platform or release new something new, maybe a new business anonymously, you will have to start from zero.
NFT’s can change that. NFTs may not transfer your followers or subscribers, but they can definitely quantify your credibility and show how trustworthy you are. As NFTs exist on a blockchain, so users can easily verify if the person with X credentials actually has X credentials or not, they just need to trust the blockchain platform.
We can use the same score for all social media platforms, NFT marketplaces, etc. Do you remember, before we talked about how some people are creating fake art and selling its NFTs? this can change that. We can extend the idea to land ownership, university degrees, and a lot more things.
Market of Everything
Take this scenario- you are in a hurry, late for work. You reach a taxi stand and grabbed one as soon as it came. In the taxi, you are busy with your presentation which you forgot to finish yesterday. You arrive at the office and off-course; you are in a rush. You forgot your wallet, and for some reason, you don’t have enough digital money. Sounds familiar, isn’t it?
That’s a pretty unpleasant situation if you ask me. It’s not like you don’t have money or you don’t own valuable things. The problem is, things are illiquid and cannot be exchanged easily for money.
NFTs come to the rescue.
As it is possible to tokenize anything with a price tag, we can create NFTs for real estate, stocks, cattle, etc, and create a decentralized market for them. Then, you can go to a random coffee shop and buy a cup of coffee in exchange for a fraction of your real estate.
You might ask ‘what if the coffee shop doesn’t accept the method of payment? And why would anyone want to hold a fraction of land?’
Let’s say the coffee shop only accepts USD. There will be services that would take your fraction of land, sell it in some market, for let’s say BTC, then they would sell that BTC for USD and transfer USD to a coffee shop. These services would look for the most efficient route to USD from real estate, for minimum costs. You won’t know what happened in between and the coffee shop owner doesn’t need to know what you did, he just got what he wanted: USD.
Birth of New Businesses
There are a lot of things that will change as NFTs conquer our daily lives. I can’t discuss everything here, so let’s just look at a few examples.
Blockchain Is Saving Wildlife in South Africa
Studex is a startup that tracks animal location, heartbeat, and medical conditions to ensure their health and safety from poachers. They store all this data in a blockchain and also issue an ERC-721 NFT. Anyone from anyone in the world can own this ERC-721 token, thus claim the ownership of an animal.
The funds collected through the sale of these animals go to farmers who take care of these animals. The revenue generated through the sale of animal products such as milk, meat, is distributed between the farmer and the owner of the animal.
There are marketplaces to buy and sell these animals; IoT devices to check their health, location, and everything; and drones for live footage. To know more about it, use the link below-
Gaming is one of the most exciting applications of NFTs. If you have spent some money on any game, you know how much it hurts to not be able to use the skins, characters, and other game objects in other games; even from the same studio.
Games in a decentralized blockchain can issue NFTs for characters, skins, guns, etc. Now, as these NFTs are decentralized, anyone who wishes to create a game that supports these NFTs can do so. Thus you can use those items in other games too.
AR glasses may be right around the corner, but what’s most exciting is that now we have blockchain and NFTs.
When AR technology matures, we will have AR glasses or lenses to replace our smartphones. Many companies like the superworld are already working on something called the metaverse.
The Metaverse is a collective virtual shared space, created by the convergence of virtually enhanced physical reality and physically persistent virtual space, including the sum of all virtual worlds, augmented reality, and the Internet.
Imagine being able to own a virtual piece of land; rent it, sell it, trade it, or live on it. You can create digital houses, 3D objects of things like shoes, dinosaurs, transformers, anything your mind could fathom. Now, what if you could sell these items or use them for advertising? What if you could customize the whole virtual world to your liking, there will be each world for everyone, off course. Do whatever you want with your own virtual world!
That’s the promise of AR with blockchain. Oh! you want to understand the whole thing in detail? Use the link below.