NFTs are more than just an art trend—they represent a mind-boggling technology that is simple yet revolutionary. The concept of Non-Fungible Tokens (NFTs) was developed first in 2017 with the launch of Cryptokitties – an Ethereum blockchain-based game that allows the creation, adoption, and trading of digital arts.
NFTs operate on blockchain technology that powers cryptocurrencies such as Ethereum. Many NFTs are created and stored on the Ethereum network. Other blockchains support NFTs.
How Do NFTs Vary from Cryptos?
NFTs may be operating on blockchain technologies, but they are not a currency. Besides, most NFT marketplaces also require you to buy NFT art with a cryptocurrency. NFTs and cryptocurrencies are essentially created and used for different purposes.
Unlike NFTs, cryptocurrencies are mediums of storing value and can let you buy or sell goods. This makes them fungible tokens like other fiat currencies such as a dollar or pound. On the other hand, NFTs only create one-of-a-kind tokens to show and convey ownership rights over digital art.
Despite their slight differences from cryptocurrencies, the NFT community has grown much like the Bitcoin and Ethereum world. Like most cryptos, NFTs are changing the way we transmit data and connect through their ability to digitize anything.
Not only are you able to digitalize your assets through NFTs, but you also have to transact transparently with anyone, anywhere. Here’s a brief look into how NFTs are changing the world of crypto.
- They Have Brought Increased Decentralization
A vast majority of the crypto world is in a decentralized state where more people can earn directly from their work without involving any middleman. NFTs have proved to be a key anchor by acting as a digital ledger to prove ownership, track transactions, and rid the middleman.
This could change the crypto world for good and probably allow people to earn more from their hard work. Furthermore, by allowing transactions to happen directly between two parties without intermediaries, NFTs have greatly reduced buffer time to pave the way for only transparent agreements.
Furthermore, NFTs’ decentralized nature means that you need no permission to post or sell anything from a specific authority.
- NFTs Have Brought the ‘Proof of ownership’ Element to Cryptos.
NFT’s proof of ownership has evolved into one of the easiest ways of verification. With Non-Fungible Tokens, you can prove what you own, how you got it, and when. Everything is stored on a personal wallet address and recorded indefinitely on the blockchain.
The proof of ownership and enhanced ease of verification in NFTs cuts across different assets. You can apply it to something as simple as a GIF or something more complex like business contracts. This makes transacting in the crypto world easier than thought.
- Increased Access
NFTs allow creators and consumers the access we’ve all dreamed of in the crypto world. You can transact 24/7 and 365 days a year with non-fungible tokens and blockchain technology. In addition, Blockchain’s ability to allow continuous transactions means NFT creators and consumers enjoy a constant direct interaction all hours of the day and night.
They can offer or buy any product to/from anyone, anywhere, and anytime. This continually creates a more personalized experience altogether, whether selling smart contracts or simple digital art.
- You can Now Earn Through Royalties.
NFTs have revolutionized how we earn from cryptos by bringing in a new revenue stream—royalties. As a creator, NFT offers you the allowance of earning royalties from secondary sales on any of your original work. In addition, you can now include a royalty percentage on your position and continue to earn for this effort days and years after the initial sale.
The royalty aspect protects creators who cannot benefit as expected from the initial NFT sale. For example, some artwork may not command a reasonable price today but would quickly go for millions of dollars in a few years. NFTs come in to help you get what you deserve, even if time has passed and the asset is under someone else’s ownership.
With NFT’s royalty percentage factored in, you’re not only able to earn from your original work, but the collector will also sell the work at a profit. This results in an actual win-win scenario that makes investment in NFTs and cryptos at a large worth it.
There’s more to think about when it comes to disruptive technologies, such as non-fungible tokens, and how they’re transforming the entire world of cryptos. The above-highlighted elements are just a few ways NFTs are changing the current crypto world. However, with technological advances expected, NFTs may soon have a new path to thrive and supply the value we can hope for.