Many people have already heard of virtual currencies such as Bitcoin, but what has suddenly become popular this year is thenon-fungible tokens(NFTs), one of the NFTs encrypted artworks called Everydays: The First 5000 Days, sold at a sky-high price of 70 million US dollars in March 2021, setting the highest price in the NFTs art market, and at the same time attracting everyone’s attention to NFTs.
What is NFT?
What exactly is an NFT? First of all, we must first understand what homogenized assets are. The value and function of the homogenized currency are the same, and it can be exchanged at will, without the need to set a price, and it can be used for trading. The currency in circulation is the best example.
NFTs are Non-fungible tokens, which are a series of identification codes built on the blockchain. They are all a type of cryptocurrency. They cannot be tampered with, are completely open and transparent, and will not be stopped.
As the name implies, NFTs are unique and irreplaceable digital assets. They can be pictures, music, tools for video games, sports memorabilia or even virtual cat collectibles, all of which are assets that cannot be exchanged equivalently.
NFT value? Is it worth buying NFTs?
Some of the advantages of investing in NFTs include:
◾ Anyone can invest in NFTs.
◾ Everyone can invest in tokenized assets.
◾ Asset ownership tokenized as NFTs can be transferred more easily and efficiently between people anywhere in the world.
Possibility of NFT Scams?
In recent years, the poisonous hand of Internet fraud has extended to text message fraud, mailbox fraud, stock investment fraud, and even to virtual currency fraud and NFT fraud. The following three common NFT fraud methods are listed:
1️⃣ Build fake NFT websites and investment projects
2️⃣ Fake the official trading platform for phishing scams
3️⃣ Use community gifts to steal login credentials or personal information
The rise of NFTs
In fact, there are many reasons for the rise of NFTs. On the one hand, NFTs are rapidly becoming popular in emerging and developing markets. On the other hand, the application market has begun to become decentralized, and more and more supported blockchain solutions have increased the application of NFTs. The most attractive feature of NFTs is their high economic potential and transformative impact on traditional asset management, such as allowing artists to connect directly with audiences without going through a middleman, and simplifying the transaction process.
Artists or inventors can upload their own works and price them on the NFTs market. NFTs only charge basic transaction fees when the works are sold, ensuring the highest profits for artists, and artists can get part of the profits if their works change hands later.
And most importantly, in the past, the original ownership, scarcity and uniqueness of digital art were difficult to confirm, making it difficult to define digital art. And NFTs bring changes. Since all digital artworks on NFTs can be tracked and traced on the underlying blockchain, which is the best way to prove copyright, the market for digital encrypted art has gradually developed.
The reason why NFTs are precious, of course, lies in their uniqueness. It is impossible to become a homogeneous token in nature, thus giving them a liquidity premium. The buyer's intentional price, the role of the work, the cultural value, the past ownership and the future value are all Create high prices for NFTs.
The future of NFTCome
The technology of the blockchain continues to innovate, and more commercial organizations are interested in this technology and integrate the blockchain into the business process. For example, recently, Taco Bell launched gifs, which were sold in a short period of time, and the NBA also used the auction of electronic memorabilia to bring in at least $300 million in revenue. There is no doubt that blockchain technology is changing the future of art and trade. Using blockchain technology to conduct transactions makes business more efficient and the market more transparent.
The NFTs market is still in its infancy. It is believed that artworks and collectibles are only the first-generation products of NFTs, with unlimited potential for future development. It is believed that as NFTs mature, they can begin to be used to verify people’s identities, for medical or educational credentials, for processing royalties, for proving ownership of real estate, and for shopping and payments. However, the NFTs market is still immature, and the market is still controversial about its future development.
For example, there are comments that with the high-profile sales of NFTs works and the emergence of lesser-known works of art, the flood of investors and creators will disappear, and only rare NFTs can continue to survive. However, it is certain that NFTs are receiving more and more attention from investors, especially in their value and application, so it is believed that NFTs can maintain stable growth in a few years.