Friday, March 17, 2023

What are NFTs? Will it be the Future for Billionaires?

NFTs, a short form of Non-Fungible Tokens, have been storming the digital space lately. Rapid digitalization is taking assets under its feather. These assets include money, identities, valuable items, and pieces of art. The normalization of cryptocurrency has given a boost to NFTs. People, mainly artists and celebrities, are showing an inclination towards NFTs as they are giving new avenues of expression and connecting with their fans.


Understanding Non-fungible Tokens (NFTs)

You must have heard the term fungible asset in economic reviews. Fungible assets are referred to as those assets that are interchangeable units i.e. can be exchanged with money or any other commodity. For example, you can exchange your bonds with money and $10 can be exchanged for two $5 notes. Things/commodities have the same value for them to be interchangeable.

NFTs are non-fungible, which means they are not interchangeable. Non-fungible commodities or assets have a unique value which is why they are not interchangeable. For example, real estate/property is a non-fungible asset because its value cannot be standardized. Each piece of land has its own value/price based on several factors. Arts and music are also non-fungible assets.

What Can be a Non-fungible Token?

Non-fungible Tokens are specified to unique digital assets and collectibles like art pieces, music, game characters, etc. Just like a property/land certificate, NFTs act as a certificate of the owner of a unique asset. However, NFTs are traded on the blockchain. It can include ownership of any digital asset like GIFs, pictures, digital art, emoticon, game characters, music, etc.

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How do NFTs Work?

NFTs work on the mechanism of Ethereum. NFT assets are tradable on Ethereum markets using cryptocurrency. Internet assets like mp3 files, documents, or pictures are not unique in the sense that one file can be copied and shared. Contrary, NFTs are unique because two NFTs can never be the same. In simple words, Non-Fungible Tokens cannot be copied and the ownership of each unique NFT belongs to someone who has either created the artwork or bought it.

Since there can be only one owner of an Non-Fungible Tokens at a single time, so there are unique names or IDs allotted to represent the ownership of an NFT. Each Non-Fungible Tokens is based on Ethereum and therefore can be traced back to Ethereum address, which is a verified source and make Non-Fungible Tokens safer. This is why all the buying and selling of NFTs is done on Ethereum. As mentioned before, NTs are non-fungible and do not hold the same value. Each NFT is different from the other in terms of its value and properties.

What are some ways of earning from NFTs?

If you are an artist, NFTs are a very good opportunity to own and sell your art on digital platforms. For example, you have a new art design for a GIF or a sticker. How cool would it be to put your creative idea to use and make money out of it? What you can do is sell the GIF or sticker to messaging apps or iMessage. Not only this but you can also earn royalty from the sold NFT. Moreover, you can buy NFTs of any digital art or music piece. This way you can support your favorite artists and can enjoy some rights over the art. These rights differ i.e. ranging from being able to post the picture to having some ownership of the art. Collecting and re-selling NFTs can be a future investment for people.

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Future of NFTs

Undoubtedly, the world is moving toward digitalization rapidly. Many new jobs, investments, and niches in the market have been gaining fame globally. About a couple of decades ago, many people shifted from normal office jobs to freelancing. Then from the end of 2019 onwards, during the COVID19 pandemic, people realized that many kinds of work can be done from home without wasting office space. The conventional work or job forms have become somewhat ostracized. Similarly, the ongoing craze over cryptocurrency and Non-Fungible Tokens is going frenzy in current times.

As it seems, NFTs will be the future. Industries and brands today take pride in displaying the products that are made by people hired by them. NFTs replace this idea and give an alternate route to everyone – taking ownership of products, ideas, and creations. Since NFTs work on a decentralized system, bigger corporations will lose their superiority and monopoly.

Will NFTs Make or Break Billionaires?

The possibilities of usage of NFT are unlimited. Therefore, there is a bigger market for Non-Fungible Tokens . However, becoming a billionnaire through Non-Fungible Tokens is debatable. Just like today, billionaires are made because of their products, idea, talent. The same thing applies to NFT. But the advantage of Non-Fungible Tokens is the lack of monopoly by big corporations. The artists or people having unique collectibles and assets will have the freedom to display their talent or products. The value is directly going to the owner without any mediator (industries or corporations). By this advantage, the wise use of NFT can definitely make a difference.

Moreover, people who step into the pool of NFT early will have the advantage of getting more experience and knowledge about the mechanism of Non-Fungible Tokens . So, Non-Fungible Tokens can be correlated but not causation for the future of billionaires.

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