Development of NFT tokens: a revolution in property rights or the next frontier in the world of cryptography?

Perhaps the three most common letters today are NFT. The whole world only talks about the innovation of the blockchain chip, but not everyone understands what it means yet … I have about the same feeling when I read on the Internet about art objects or virtual pictures sold as NFT tokens, the price for which reaches several million dollars.

Over the past couple of months, the new NFT trend has rapidly gained momentum, becoming a real phenomenon not only in the world of cryptocurrencies but also in other market segments. So what’s the deal here? Let’s try to figure out what kind of digital innovation it is and what awaits the NFT revolution in the future?

NFT in simple words and how to decipher an abbreviation?

A unique or non-fungible token — NFT. It turns out that it is absolutely unique and cannot be replaced by anything. For the owner of a certain little thing, it will always be one of a kind. If you want to exchange it for a similar one, it means owning something else. In simple terms, it is a unique combination of encrypted data located in a specific table.

By themselves, tokens are not fundamentally something new, but they are no longer a currency, but an individual entity. At the same time, there is a price for each such unique thing. Also, a token can be associated with a specific product by transferring the necessary properties to it.

Another point: if a token is transferred to someone, information about this is recorded in the blockchain, so it is known who is the owner of the goods at the moment. By the way, a double sale is simply not possible. Various jewellery, works of art or music and even films, usually digital, their storage and connection with the token depends on the characteristics of a particular platform.

Actually, this is the whole theory. Now, imagine digital images or animations costing thousands and sometimes millions of dollars. How is it that people spend huge sums of money on what? Let’s figure it out further.

What are they selling in NFT format?

Non-fungible tokens are represented by digital objects: music files, paintings by artists, and even a copy of your signature converted to AI, as well as luxury goods, luxury Swiss watches and all kinds of art objects.

The advantage of such tokens is the fact that they make it possible to become the owner of the original. This means that ownership is recorded on the blockchain, and you do not need to keep paper documents, for example, to your collection of watches or jewellery. You will always have access to the latest status of your products, all information about the owner and the history of transactions will also be reliable and accessible.

The main groups of goods sold with tokens:

• Objects of art. This category includes analogues of traditional world works of art.
• Unique characters of games and various cards. This includes collectable cards, virtual heroes, and play space.
• Luxury goods, collectables. Various figurines, expensive watches, luxury limited-edition accessories fall into this category.

Any physical product can be tokenized. Social tokens are still an experimental option. Celebrities can donate personal tokens to their fans. What’s the big deal? But how can you boast that you have an original from your favourite “star”.

For owners and buyers: what is the point of acquisitions?

The transactions made with the goods protect the owners from counterfeiting. At the same time, blockchain platforms make good money on operations, and for buyers, it is a profitable resale. All you need to do is add the product or artwork to the database, and its origin will be preserved, as well as value and ownership.

One of the obvious advantages when buying is the ability to check a gizmo or an expensive accessory in real-time using a serial number. They are registered by the owner and verified for authenticity. The data entered into the secure database will confirm that your jewellery or other item belongs to you. If during the purchase, the seller offers a stolen product, a special application will notify you about this, and you can contact the owner.

The market will never be the same: where can you buy all this?

A sufficient number of blockchain platforms open up ample opportunities for the purchase and sale of NFT objects. Some function like marketplaces, while others specialize in one thing, such as gaming or music. Some of the most popular services are OpenSea, Rarible and Niftygateway. There are also “closed” platforms, where trading is possible only after the user confirms his identity. These include SuperRare and Async Art.

You can sell tokens on well-known world marketplaces using Ethereum for transactions. The main condition is the presence of this crypt on your electronic wallet. On some platforms, you can become the owner of tokens for USDC or DAI.

Typically, unique items are sold through auctions where the owner can offer a starting price per lot. By replenishing the wallet with cryptocurrency, it is possible to purchase NFT at a fixed cost or make your own bid at the auction. If your rate is not higher, you become the owner of the token. The funds will be debited from the balance automatically. Once the token enters the wallet, you can view and manage it.

Possible use of NFT tokens

Thanks to blockchain technology, not only collectors secure a secure right to own unique assets. Anyone can create and monetize their own items, including selling them on the secondary market.

The most common times when NFT tokens play an important role:

• Selling artworks digitally by creative individuals without participating in art galleries. This makes it possible to program NFT tokens so that with the next resale of his masterpiece, the creator receives a certain part of the copyright profit.
• The sphere of education. Every year, hundreds or even thousands of employers in every country have to deal with fake documents of potential candidates for an open position. A similar problem can be easily solved by issuing NFT tokens that display the required identification data on the blockchain.
• Fight against identity theft. By digitizing the necessary information, attackers will not be able to forge the user’s personal data.
• Game industry. Many players are ready to shell out a tidy sum of money to play the most unique NFT-character equipped with rare weapons and unique equipment. NFT gaming features allow enhanced game artefacts or characters to be used in a variety of game environments outside of content.
• Luxury goods, luxury watches. If you want to sell a product, all the origin of the product is stored in the blockchain. The buyer can check whether the item being sold is new or used by the registered date of the first sale.

The market value of tokens is growing rapidly every day, indicating a transition from a simple stage of an ordinary hobby to a serious financial instrument. By tying NFTs to real-world objects, you can avoid theft or tampering and find the best deal for you.

Global companies harnessed by NFT capabilities

The popularity of NFT tokens continues to gain momentum, technical capabilities have found a response not only among members of the crypto communities but also in some industries of the business sector. Many well-known brands use non-fungible tokens in their projects. Some of them:

• Samsung. The creators have developed the Enjin cryptocurrency wallet for their smartphones with NFT storage functionality.
• Nike brand. Tokenized a collection of sneakers using the capabilities of NFT. By owning tokens, it is possible to sell them on the market, as well as exchange them for real shoes.
• Formula 1. As part of the agreement between the brand representatives and the creators of entertainment video content Animoca Brands, the F1® Delta Time blockchain game was created. Users have the opportunity to create their own NFT collection, including confirmation of ownership of cars and other unique in-game items.

The opportunities of tokens were used by large companies Louis Vuitton, Vodafone and other brands. The uniqueness of non-fungible tokens has opened up good opportunities for additional profit for their owners.

What is the reason for selling NFTs at high prices?

Firstly, the concepts on which the tokens are based have their own unique and unrepeatable identification, even no two can be interchangeable. The smallest and indivisible unit is 1. According to experts, NFT has not lost its positions for a couple of years and is a niche market. Its main applications are found not only as in-game content but also on virtual world platforms, crypto art collections and storage platforms for expensive jewellery. Most of NFT’s assets are based on ETH, and the main public networks also support the issuance and circulation of tokens.

Considering the fact that NFT has been in development for more than three years, the market is showing robust and stable growth. The popularity of non-fungible tokens came with the launch of CryptoKitties. The cute electronic cat was sold for approximately 600 ETH, or approximately $ 270,000. Could you spend $ 270k on a digital cat?

Another point in favour of NFT is a stable user base, used as the main application scripts. One of the largest platforms, OpenSea, has just over 20,000 users who can create, use and monetize personal content and applications. In addition, the popularity of art collections around the world served as a good basis for the development and distribution of NFT.

Summing up

Take the Swiss Rolex watches, which are bought by wealthy people solely to emphasize their prestige and to demonstrate a certain status in society. However, what does this whole digital world have to do with it? Everything is quite simple, place, for example, a purchased image on the Internet as an avatar. Using the blockchain, it will be possible to check whether the account owner really has rights to it.

Such NFT tokens can be compared to the “Rolex” of the XXI century, which is a kind of prestigious chip that opens the door to the world of great opportunities and privileges. Speaking of physical assets in the digital world, NFT tokens are quite capable of becoming an important part of not only the blockchain ecosystem but also the economy as a whole.

Stay tuned and follow us on:

Facebook / Twitter / Twitter Ru / Youtube / Telegram / Telegram Ru / Telegram chat / Telegram chat Ru / LinkedIn / Website