The Connection between Rights & Benefits NFTs and the Real World
first DEX for utility NFT
During 2021, a number of top public blockchains and exchanges tapped into the NFT frenzy despite the cryptocurrency market being hit by significant volatility in May and June.
NFT, short for Non-Fungible Token, can digitally represent aspects of numerous goods and services in the real world due to it being unique and indivisible. The value of NFT has been gradually revealed to more people and has linked to more physical goods.
Rights & Benefits NFTs and Ownership
An NFT, based on blockchain technology, is able to prove the authenticity and ownership of digital assets, greatly embraced by cryptocurrency markets.
In the traditional art industry, a piece of artwork can earn the artist money only once in spite of all his time, effort, and skill that went into its creation. The ownership of the artwork is transferred to the buyer as long as it is sold. As the artist gets famous and the value of his/her artwork is highly appreciated, the work might be resold at a record high. However, the artist does not gain any further profit from the resale of this work. Fortunately, NFTs can address this situation. When minting an NFT from his/her work, the artist can specify a certain percentage of revenues generated from this NFT to be paid in royalties for every transaction in the future. In this way, NFTs change the way artwork has been traded and owned in the past thousands of years.
Additionally, NFT enables us to digitize the assets that could not be digitized before. On Chair, a Rights & Benefits NFT trading platform, KOLs from different backgrounds can tokenize their rights and benefits into NFTs so that they become tradable on the platform. All the transactions of NFTs on Chair are managed by finely-designed smart contracts which conduct the transactions automatically when specific requirements are met. Creators of NFTs can define all attributes of their NFTs through the smart contracts. Both parties of a transaction do not need to worry about each other breaching the agreement as long as all NFT attributes are recorded in small contracts on the blockchain. With the help of smart contracts, all transactions are completely decentralized and transparent without the intervention of a third party.
In the near future, the use cases of NFT will cover multiple industries including financial assets, data, and digital identification. NFT will change the way how people think of ownership in the digital era.
Rights & Benefits NFTs and Liquidity
In the real world, many goods and services are facing challenges such as liquidity and monetization. Chair significantly enriches the category of NFTs. On Chair, NFTs can represent financial assets including real estate, vehicles, and stock shares; digital identities including ID card and genetic sequences; data rights around anything from internet traffic, IP, a song, a photo or software source code... Everyone can easily create their own NFTs from their rights and benefits and trade them on Chair.
Let’s take mining software suppliers for an example. They can tokenize hash rates into NFTs, then different NFTs represent different hash rates. Thus hash rates are recorded on the blockchain to achieve high liquidity.
A liquid NFT market consisting of buyers and sellers will promote a better price discovery mechanism because it speeds up the transaction of NFTs in the secondary market. Sellers can easily monetize their rights and benefits while beginners enjoy a low entry barrier to the market where they can quit as long as they are willing to.
Rights & Benefits NFTs and the Environment
As Elon Musk expressed his concern over bitcoin mining’s impact on the environment, many people started to worry if NFTs are also harmful to the environment. The creation of NFTs requires constant increase on hash rate, consuming a large amount of electricity. Computational artist Memo Akten conducted a research about the carbon dioxide emissions generated by NFT creation. Akten determined that the average NFT has a footprint of around 211 kg of CO2. Essentially, it is the Proof-of-Work (PoW) protocol on the Ethereum network that leads to such a large quantity of CO2 emissions.
Chair is based on the Binance Smart Chain which consumes less energy compared with Ethereum. A diversity of rights and benefits can be tokenized into NFTs on Chair with a simple click, which is helpful to decrease CO2 emissions while creating NFTs. For example, an investor can tokenize his dinner time or meeting time into an NFT which can be traded on Chair so that project owners and investors can get in touch easily. Through creating NFTs on Chair, investors can not only spend less time looking for good projects to invest in, but also earn money. Bitcoin or Ether-like mining is not involved in the NFT minting process.
NFT will play an increasingly important role as the development of the digital economy deepens because the NFT ecosystem has the potential to change the real world in multiple ways. Although there are two sides to everything, such a grand NFT revolution brought to the digital economy warrants high expectations.
About the author
CHAIR is the world's first decentralized trading platform for utility NFTs. CHAIR tokenizes "rights and benefits" into NFTs and establishes a brand new NFT trading system to improve asset liquidity and economic efficiency.