Non-Fungible Tokens Are Here To Stay, Here's Why
There's been a lot of talk as of late revolving around digital collectibles stemming from the sports, music, art, and gaming industries. Non-fungible tokens have been gaining immense popularity alongside the rise of blockchain technology.
What are NFTs?
While the crypto world often can be confusing and quite intimidating, NFTs' potential to impact culture on a massive scale makes the technology a subject worth learning.
There are many resources out there with a detailed breakdown of NFT; the essence is quite simple:
Non-fungible tokens are unique, digital items with blockchain-managed ownership. This can include anything from sports cards to digital sneakers and even real estate. They can represent tangible and intangible items, but unlike most cards or sneakers, each NFT contains distinguishing information that makes it distinct from any other NFT and easily verifiable. Therefore, collectibles cannot be faked and hold immense value due to their complete rarity.
Fungibility, for example, is when a good or an asset can be readily interchanged for another of like kind. Goods and assets that are not interchangeable would be non-fungible, making
individual NFT good and assets one of a kind.
Spreading like Wildfire
Conceived on the Ethereum cryptocurrency platform in 2017, lately, non-fungible tokens have made some serious noise across all industries.
The gaming industry is considered the leader on the wave of non-fungibles. CryptoKitties, a blockchain-based game developed in Canada, allows players to purchase, collect, breed, and sell virtual cats.
And boy, do they sell? Some kitties have sold for more than $300,000 a piece, while the average sale price is around $65.76.
There are dozens of entities taking part in NFT technology in gaming, backed by blockchain companies, and others venturing into this world for the first time. Nonetheless, the video game space seems like the perfect setting for NFTs to thrive. Giving players ownership of rare collectibles from the games they love creates a digital marketplace like never before in the world of gaming.
If any industry is to thrive on the use of NFTs, it's sports. And we already see it occurring.
Sorare is a global fantasy football experience where players can buy, sell, trade, and manage a virtual team. Along with Juventus, Sorare has agreed on deals with 37 different clubs around the world. Like physical sports cards, NFTs create an opportunity for fans to engage deeper in the game but connect to other fans.
In the world of basketball, NBA Top Shot is taking over. Top Shot grew its user base by 50% in just seven days and topped $45 million in sales volume on a single day in February. Top Shot takes NBA-licensed video highlights and sells them as packaged collectibles. For example, a LeBron James dunk sold for $208,000.
Like Sorare, Top Shot is essentially a virtual sports card. But instead of an image and statistics, you're buying a moment. NBA fans are, perhaps, the most dedicated fans in sports, and Top Shot is giving fans an opportunity to quite literally own a moment.
Mavericks owner, Mark Cuban, praises NFTs and sees them as a tremendous opportunity for sports and the world as a whole.
Like fine art connoisseurs before them, digital savants are now using NFT technology as a platform for investing in, owning, and appreciating the modern world of art.
While you can't hang an NFT in your foyer like you could a Warhol piece, ownership over these assets significantly desired at the moment. The ten most expensive NFT's fell under the art category, 6 of which are NFTs known as CryptoPunks. Ten thousand uniquely generated CryptoPunk characters; the highest pieces hold value in the millions.
Jacques Greene is an electronic musician based in Toronto who recently took a unique music distribution approach. Greene partnered with the crypto marketplace, Foundation, to sell the publishing rights of a forthcoming single. The highest bidder will not only receive publishing rights in perpetuity but an audio/visual art piece as well. Greene expressed a poor relationship with a music publishing company in a Twitter thread when he announced the upcoming single, "Promise".
Greene's NFT ended up selling for just north of $22,000, giving the song's winning bidder publishing rights. The music industry hasn't seen anything like this, where a consumer now has a hand in music distribution.
Another cool example of musicians' involvement in NFTs is a recent partnership between a technology company, Genies, and Shawn Mendes. Genies will be auctioning off one-of-a-kind digital assets, including a guitar, vest, necklace, and earrings. These pieces can be displayed on a user's digital avatar.
Leveraging NFTs for Your Brand
As somebody with a personal brand, whether you're an athlete, artist, musician, gamer, or creator, leveraging both your following and the current momentum of the NFT market can be a valuable business endeavor.
Take Logan Paul, for instance. Paul dove headfirst in the world of cryptocurrency with the release of his very own NFT's. The set of 3,000 Pokémon-inspired digital cards released on February 19th, in which over half sold on the first day, raking in roughly $3.5 million in sales.
Though the YouTuber has built up a following in the millions through a number of ventures over the course of six years, the truth is, anybody can get involved. Peter Yang of Creator Economy put together an in-depth guide to how creators can leverage their following with NFT's to take control of their likeness.
Ultimately, the reason why NFTs are so game-changing is because of the uniqueness of each asset. The same way a consumer would feel if they found a rare trading card in a pack, they can now experience with NFTs. Paul is an excellent example of somebody with a strong personal brand who has benefited from NFTs, but you don't need to strive to clear $3 million in sales in a single day.
No matter your industry, if you've developed a following and loyal fanbase, you have the opportunity to create unique content and distribute it on an NFT marketplace. By going directly to consumers with content that comes personally from you, you're doing right by your fans and allowing them to invest in your success.