The art market is exploding thanks to NFT (Non-Fungible Token), a tamper-proof digital certificate that proves the authenticity of virtual objects. For some, NFTs are the future of property, for others, a fad reserved for collectors and speculators. What is an NFT really?
NFT technology (French incompatible tokens, editor’s notes) is certainly made for you. Indeed, thanks to this technology, which is based on the crypto currency “smart contract”, you can get a tamper-proof certificate for your purchase. This is a kind of digital title certificate that proves the uniqueness of your property.
At first glance, this may seem a bit vague or irrelevant. However, according to many experts in the field, the “NFT revolution” is still underway. These certificates are exploding digital art, the next generation of video gaming industry, and even more in the future. A small guided tour of the strange and encrypted world of NFTs.
Buy, collect, resell, guess
American artist “Beeple” has sold a digital photo named “Everyday: The First 5000 Days” for over $ 69 million through Christie’s auction house in New York. However, this digital photo of the NFT can be viewed and downloaded by any netsurfed who wants it. This is not the case for masterpieces that are carefully preserved invisible in the real world.
But why did the buyer of this image pay such an amount? Not because of the value of Beeple’s digital work itself, but because it was sold with NFTs. NFT Meaning to make it unique and traceable. The digital certificate shows that it is certainly the artist’s original work. It also shows who bought it, who bought it, for how much, and when.
Therefore, this digital collage by an NFT-certified American artist will be available for sale at another auction, and anyone can see its authenticity and background (mostly on the Ethereum blockchain.
In addition, as the value of the crypto currency that made it possible to obtain an NFT certificate for this image increases, the value of this image will increase for NFT owners.
For the authors of the “NFT Revolution,” crypto art offers the possibility for artists to break away from their reliance on online music platforms. “The fact that artists receive a small portion of the income generated by listening to their work on streaming platforms is a contradiction. It’s usually no longer necessary because the Internet builds a direct relationship between artists and their communities. No Intermediary with NFTs, we can rediscover this direct relationship, “says John Karp.
Therefore, according to the author, the crypto art movement has begun to “find the mark and invent a new process.” “NFTs are embodied in a variety of ways, and the possibilities are endless. NFTs are titles of ownership, but they can also include titles of use or access related to the artist’s behavior. Carp gives an example: “It created 25,000 NFTs last week, which gives you access to related videos. The Kings of Leon group goes a step further. With NFTs, you can access all your concerts. Know further about what does NFT mean? And what are the advantages or disadvantages of it?
Advantages and disadvantages of NFT
Therefore, irreplaceable tokens are clearly popular at this time. But what are the strengths and weaknesses of NFTs? Below are some potential strengths and weaknesses.
Benefits of NFT
Here are some of the commonly cited benefits of NFTs:
- They give the artist ownership of digital assets. When content creators create digital assets, NFTs give them the opportunity to not only be genuine but also profit from their work.
- This can mean a significant flow of income for the creator, as things like memes are widely distributed.
- They are unique and can be collected. Many people enjoy the excitement of collecting unique and unusual items.
- They are immutable. Non-fungible tokens are blockchain-based and cannot be modified, erased, or replaced. Again, this is a valuable quality when it comes to proving the origin and credibility of digital content.
- You can include smart contracts. Another very interesting feature of blockchain technology is smart contracts. Basically, you can store a statement that will be executed when certain conditions are met. Therefore, NFTs with smart contracts may give artists a certain percentage of their profits when they are sold in the future.
Disadvantages of NFT
Of course, like any new technology, it has potential drawbacks. The disadvantages of NFTs are:
- It’s a speculative market. The big question is whether NFTs are of real value. Is this a long-term investment? Or is it a fad? It’s hard to say.
- You can copy digital assets. Just because someone owns an NFT of a digital asset doesn’t mean that a copy doesn’t exist. The work of art can be copied and pasted, the GIF will be rerun thousands of times, and the video will be posted to various websites. Owning an NFT does not mean that you are in control of goodness. It only guarantees reliability.
- Environmental costs. People have said a lot about the environmental impact of blockchain-based cryptocurrencies such as Ethereum and Bitcoin. Entering data into the blockchain requires a lot of computing power. The sustainability of blockchain-based assets is questionable.
- They can be stolen. The basic technology behind NFTs is relatively very secure, but many things like exchanges and platforms do not secure enough. Therefore, some cases of NFT theft have been reported after cybersecurity breaches.
Are non-fungible tokens in the future?
We hope you now understand what NFTs are and how they work. We should have seen many potential applications for tokens in the real world, but are they the technology of the future? Imagine that by combining NFT with artificial intelligence, machine learning technology, and deep learning, the possibilities will become endless.