NFT’s have been increasingly popular in the past few years and they have already created a lot of buzz all over the world. Millions of dollars have been traded in wealthy neighbourhoods around the world in a very short time, and their sales figures online have skyrocketed. NFTs made headlines for a number of reasons, including the $172k sale on Nyan Cat and the $500k donation from The New York Times. A lot of records were broken with the highest sale of an NFT reaching $8 million. What was happening initially? Was it a bubble that burst or is there some solid future for these tokens? Keep reading to find out.
What is NFT and how does it work?
With a digital tokenization system, your physical belongings can be assigned a digital value. This is called “tokenization” and it’s done through a distributed ledger. Some tokens are “fungible,” meaning that their constituent parts can be swapped for other tokens like fiat cash. Others, such as artwork or blog posts, are non-fungible. This means that the parts of the object cannot be swapped because they are unique. Non-fungible tokens (NFTs) are a type of token in which all units in its case can’t be subdivided in any way whatsoever. These are created on a blockchain forum, usually ethereum, and exchanged on the same blockchain’s marketplace
These non-fungible tokens are developed using blockchain technology, so you can take advantage of all the added security benefits. For instance, they are completely anonymous, have robust cryptography to protect them from being changed or tampered with, and will never expire. On a blockchain ecosystem, it’s pointless to put as much effort as possible into making fake collectibles because it’s easy for the original owner to trace.
This token has intrinsic features that differ from tokens in other sets. It’s easy to verify with its certificate that you are the owner of the item. The tradeoff is that each token is unique, which means they can’t be interchangeable. NFTs are not safe to be copied because you would have to input the verification number of the certificate, which cannot be accessed outside of the blockchain. Therefore, there is no chance for another person to take it without stressing you out. The bonus of building the token and the NFT marketplace on the same blockchain is that two network participants can swap tokens. For example, you will be able to trade artwork for cryptocurrency.
An overall NFT statistics for this year.
NFTs were introduced in 2021 and quickly garnered attention within the fintech industry, especially after the price of some pieces of art skyrocketed. One artist, for example, sold their work on NFTs for US$ 1 million. We had news earlier this year about Jack Dorsey’s first tweet being sold for $2.9 million. This is not the first time crypto collectors have bought digital avatars for large sums of money, CryptoPunk was sold for over $11.7 million in June. According to Nonfungible, a company monitoring the market, NFT sales reached an eye-popping $2 billion.
However, more recent data demonstrates a dip in the NFT market size. According to Nonfungible’s NFT statistics, overall revenues in the area dropped from a seven-day high of $176 million on May 9 to just $8.7 million on June 15.
The report provides an overview of the current size and future prospects of the NFT industry
The recent NFT sales statistics may seem discouraging but experts in the field aren’t too concerned about it. The crash can be considered no different to other markets where up and down is expected and rapid uptrends are usually soon met by a decrease. The crash is simply evidence of the markets stabilising. Many people believe that Non-Fungible Tokens create a bigger purpose and could lead to long-term value. The fact that the digital world is becoming more and more common, and people spend more time on the internet, could mean that NFTs will become increasingly popular.
Evidently, NFT markets are predicted to grow steadily in the near future.
NFT joins hand with Augmented Reality (AR):
PROFESSIONALS IN AR/NFT believe that integrating them can result in a huge value for both AR and NFT industries. AR lets 3D designers, architects, and innovators bring their projects out of the two dimensional display and into reality. It offers whole new scales, interpretations, reflections, engagement opportunities and contrasting challenges. When art becomes digital, NFTs will become the major form of currency. Us humans might picture a society in which we possess and administer our own designs of cities via NFTs, either individually or as a group.
The effect of AR as well as NFTs on the art world:
It is predicted that AR and NFT integration will soon completely redefine the art world. The pandemic had a devastating effect on many artists and 43% of museums risked closure during this disaster. Going digital has saved many artists this year. Plus, the amalgamation of AR in museum and gallery exhibitions has a better chance of drawing the newer generation. In the not-so-distant future, all of the art people buy or invest in will be digital. The NFTs make it safe and easy to own a piece of art. It seems that, despite the newest cryptocurrency sales stats, these tokens are here to stay.
NFTs have been slowly gaining traction as a financial instrument for years now, and they’re quickly making waves in the video gaming and collectable markets. And from the looks of it, that trend is here to stay. Apart from the fields mentioned, AI experts also looking into different segments of society to see how they can help – like real estate deed management or vehicle name registries. As AI becomes more advanced, it is sure to permeate further and include even more sectors. The world of NFTs offer many new and unique ways to invest your money, but it’s best to fully research projects and platforms before you buy in. Full transparency is crucial in this developing market, so be sure to get advice from the experts out there.