I can still remember the call I received from my mum earlier this year- she wanted to know more about NFTs. She said she has been seeing it on the news and social media lately and she has collected a lot of NFTs already and she looking for a way to sell them.
I was dazed! I couldn’t just wrap my head around the fact that my mum owns an NFT – I’m like how? So I responded!, “Really!, how did you get them?” she goes like “I have been saving the costly ones off social media, they are all in my gallery – how do I sell them? ” I couldn’t just contain my laughter.
Here I was trying to find the perfect words to explain to my mum that NFTs usually come with a form of digital ownership that is stored on the blockchain and each NFT has a unique fingerprint, token name & symbol, and a link to file on IPFS. Even if I did find the words, I’m sure she will certainly not understand.
Well, to cut the long story short, I did explain to her, just as written above and her response was “Okay no problem” I know for sure that she didn’t understand anything I said but just didn’t want to overcomplicate things for herself.
NFT, stands for non-fungible token.
Non-fungible means something which is unique and cannot be exchanged for anything else. For instance, Bitcoin is also fungible, meaning you can exchange one Bitcoin for another. For instance, your favorite limited edition football player’s card is an example of a non-fungible commodity
NFTs are one-of-a-kind digital asset that belongs to you and you only. I think this definition communicates its meaning better.
The whole idea behind NFTs is digital ownership. People just need a way to prove that they own something. The value of an NFT isn’t on the attached artwork, what is more, important is proving ownership of that particular asset.
Below are some popular cases that will make you rethink everything
Dorsey’s first tweet, which reads, “just setting up my twttr,” was posted by Dorsey on March 21, 2006. The tweet was sold as a non-fungible token (NFT) – The tweet has been sold for the equivalent of $2.9m (£2.1m) to a Malaysia-based businessman. Wow! isn’t that crazy?.
The tweet is publicly online, anyone can see it or even take a screenshot. Why would anyone want to own it?
Well to answer this question, he didn’t purchase the tweet, what he purchased is a digital certificate of the tweet, which contains a unique fingerprint and token name. This is unique because it has been signed and verified by the creator. It’s more like buying an autograph. Crazy right?
It will also interest you to know that one video clip of LeBron, lasting no more than a few dozen seconds sold for an eye-popping US$208,000 ($AU268,000) as an NFT. Why would anyone want to own a short video of LeBron?
Bored Ape Yacht Club
Bored Apes! Developed by Yuga Labs, the Bored Ape Yacht Club is a collection of 10,000 profile pictures minted as NFTs on the Ethereum blockchain, Only that 10,000 can ever exist. Most A-list celebrities are buying these Apes for a killer sum. Jimmy Fallon, Steph Curry, and Post Malone are among their star-studded owners. These NFTs are also marketed as an entry ticket into an exclusive group and its luxurious lifestyle. Although virtual, it quickly became a status marker among the NFT community. Recently a video content creator and musical artist from Germany iCrimax sold his Lamborghini to buy a Bored Ape Yacht Club NFT. Right now the price of entry is 52 ether, or $210,000.
By owning a Bored Ape NFT you have automatic access to additional NFT collectibles which can be resold for potentially considerable amounts of cash. For instance, the Bored Ape Kennel Club dog NFTs was offered to Bored Ape Yacht Club for free.
They later released free “mutant serum” NFTs that generated a Mutant Ape Yacht Club image.
Here comes the insane story, Ghozali Everyday! an Indonesian student who took 933 self-portraits of himself between the ages of 18 and 22, from 2017 to 2021, and sold them for nearly USD 1 million. As of 24 January 2022, the collection’s total traded volume on OpenSea stood at 387 ETH
Nyla Hayes Collection
Another interesting story is that of Nyla Hayes a 12-year-old creator of the long Neckie NFT collection, which features diverse women with elongated necks inspired by her favorite dinosaur, the Brontosaurus. Nyla has over $6 million with her NFTs.
NFTs are not limited to just artworks it has seven use cases:
Real-world asset NFTs
With real-world NFTs, you can digitize the way we prove ownership – instead of just getting physical deeds to prove that you own a piece of land you can get tokenized digital access to those deeds. This way you can move highly illiquid items (like a house or land) onto the blockchain.
Collectibles are simply unique items that are minted on blockchain as NFTs for anyone to acquire. They are usually limited, and they sell for substantial amounts. An NFT can be both a collectible and an art piece.
Jack Dorsey’s first tweet is a great example of an NFT collectible, mostly because its value is purely for its collectibility.
Another great example is the NBA Top Shot, where collectibles related to a game are being minted as NFTs. I made mention of this earlier on this post when one video clip of LeBron, lasting no more than a few dozen seconds sold for an eye-popping US$208,000
Some NFTs also provide financial benefits. These types of NFTs usually come with artwork but their value comes from their utility. A good example is JustLiquidity, which offers an NFT staking model. Other examples are Gaming NFTs, where digital items inside video games–things like collectibles, weapons, and cosmetic skins–are real-world assets, similar to stocks or bonds, in the form of non-fungible tokens (NFTs)
Just like a piece of art or video, you can also attach audio to an NFT to create a collectible piece of music, more like a digital-first edition of a record.
2 thoughts on “What are NFTs, and of what use are they?”
Excellent work, nicely laid out…and interesting!
Thanks for your input. I appreciate