NFTs – The New Rise of Digital Art
When surfing online, you will have come across millions of digital illustrations and memes that have stayed popular for years. Such a meme is “Nyan Cat,” all grey, flying in outer space with a rainbow behind its tail. It’s hard to believe, but this particular GIF was just auctioned and sold for $590,000 by its creator.
Everyone had a chance to see this meme, so how did it sell for so much money? The answer lies in the new cryptocurrency craze that everyone is talking about – NFTs. These are unique artistic assets that cannot be replaced nor replicated.
Even though NFTs were released back in 2017, they have only now reached a new peak in popularity. Collectors, investors, and creators worldwide are now vying to get in on this digital commodity that simply exists online.
Even James Cordon spoke about it on his late-night show, and one of the show’s beloved musicians, Reggie Watts, talked about the fact that he and a friend were creating a piece of art to sell as an NFT.
So this begs the question – what is the deal with NFTs and why the huge buzz? Here’s an introduction to the hottest digital trend.
Table of contents
NFTs – What Exactly are They?
NFT stands for “Non-Fungible Token.” It exists on a blockchain, and is similar to bitcoin, in the way of its digital ledger technology.
There is a huge difference though, which leads to the exorbitant pricing of such particular digital art. In general, you will find that the majority of bitcoin is fungible, it can be exchanged.
NFTs are the opposite. They are categorised as “non-fungible.” They are pieces of art that are unique and cannot be replicated or exchanged.
Once you pay for a particular NFT that you like, you own it. It ultimately belongs to you alone, and blockchain authenticates it and makes it unerasable.
Pretty straightforward, right?
Although this renders it useless as a form of currency, it has immense value in the world of digital art, such as animations, images, films and music.
Until now, the term “cryptocurrency” has laid itself in the hands and minds of people in finance and related industries. But now, many celebrities, such as Shawn Mendes, have joined the “NFT Bandwagon”. Kings of Leon are now the first band to release a brand new album as an NFT and have already made over $2 million in sales. The easy-to-grasp nature and novelty of NFTs have opened the world to artists and the general public, whose interest continues to grow
Why Are People Paying So Much for These?
NFTs have been sold to collectors for as much as $6.6 million due to its uniqueness and scarcity. Like fine art, investors believe the value of these digital art pieces will appreciate – just like Picasso or Salvador Dali’s artwork would, in time.
Buyers are secure with their purchase because everything is done through blockchain. They receive a certificate stating they are the owner – that the item is unique and cannot be forged. One just has to watch a documentary like Made You Look to realise how easy it is to forge famous artworks. As an NFT, your artwork will exist in the digital world protected by heavier security than the Louvre Museum, in the form of a security blockchain named “Ethereum.”
There is a Catch-22 though. These digital NFTs can all be saved with just a “right-click” of your mouse. However, you, and only you, are the authentic owner of it, and nobody can take that away from you.
When Artists Regain Power & Control
Besides the appeal of owning a “one-of-a-kind” piece of digital artwork, there is an even greater appeal of NFTs for the artists themselves, who now have greater power and control over their digital artistic expressions.
NFTs allow artists to receive 2.5% and 10% of the sale price every single time the token is handed over to new ownership. Artists now receive payment which increases their profit, compared to simply selling their art to a dealer or through a gallery or auction.
The benefits dont just end there, though.
NFTs are also ticket-based, allowing people, such as concert promoters, to divide the revenue among all those involved, such as the DJ and caterers, etc. There is more trust and authentication as all payment would go through blockchain immediately, leading to all creative parties gaining fair income.
A Trend or Glimpse into the Future?
Everything new is often a novelty, especially if celebrities are involved; everyone wants a piece of the action. What blockchain and cryptocurrency have done is revolutionised ownership. With virtual environments taking over everyday life, NFTs give a solution to a problem that has been around for a while – digital scarcity.
Christie’s is the first auction house that has sold an NFT-based artwork for $69 million, and the possibilities for creative expression through NFTs seem endless. Both creators and collectors are to gain tremendously.
So, is this just a fad and a trend of the times, or will it hold its place among cryptocurrency for years to come, with digital artworks only rising in value? Only time will tell!
What’s your opinion on future of NFTs and cryptocurrency? Comment down below!