Non-fungible tokens, or NFTs, have become an overnight investment phenomenon On Tuesday, $ 60 million in sales—Exceeding total sales of intact of 2020. An NFT is a type of cryptographic token that is used to make digital media unique and therefore collectible, whether it is a GIF or even a sports highlight. If you’re wondering why all of a sudden everyone has forgotten how to take a simple screenshot or if it doesn’t confuse you, you’re not alone.
What are NFTs?
Using blockchain technology, NFTs designate an official copy of digital media, which can be sold by artists, musicians, or sports organizations to make money with content that would otherwise be cheap or free. NFTs are different from cryptocurrencies because they are not interchangeable; each is unique.
If you buy an NFT through a cryptocurrency asset market, it’s up to you to keep it in your digital wallet or put it up for sale on the market. When sold, all computers on a decentralized network record the transaction in a shared ledger, which is, in effect, a certificate of authenticity that cannot be altered or erased.
NFTs have a wide range of uses, including collectibles sports cards, digital art, i virtual real estate. For Yahoo, brands like Nike, Louis Vuitton, and the NBA have already begun generating NFT-based assets, with the NBA launching a dedicated collecting site called NBA top pitch. Last week, artist Chris Torres sold a unique version Gat Nyan, a popular flying cat meme with a Pop-Tart body that leaves a rainbow trail, for the equivalent of about $ 580,000, according to the New York Times. Rick and MortyJustin Roiland has done the same jumped to NFT.
G / O Media may receive a commission
Why would anyone spend money on this?
It may seem strange to buy the “authentic” version of something that you can easily remove from the desktop, but it’s easy to overlook the emotional value of collecting, especially when it comes to original art. Some of the attractions are the ownership of an authentic item created by an artist you like and the rights to brag about it entail. Basically, this is not much different from owning an original Andy Warhol painting that can be displayed, sold or shared, it is simply digital. In addition, artistic encryption finally unblocks the problem that artists pay for, as creators can schedule these assets to pay them royalties every time the collectible is sold.
In addition, and possibly most importantly (if we explain the renewed interest in NFTs, which have been around for years): People are increasingly seeing these digital resources as speculative investments, as they can be bought and sold in online markets (a collectible NBA Top Shot collectible digital card from basketball star LeBron James recently sold for $ 100,000, for example).
The increase in recreational investment during the pandemic is also likely to be a factor: most of these exchanges accept cryptocurrencies, which of course meets the demand of individual investors who have cryptocurrency stocks and want to spend it on something that is fun and has the potential to make more money later. It remains to be seen whether this interest will continue to hold valuations of half a million dollars from a flying cat GIF.