New trend of 2021 – NFT Tokens. Who’s responsible?
2021 brought us many good and bad news. One of good news was the extensive use of NFT Tokens in the field of art and creativity. Now, I will try to explain to you the basics of NFT Tokens, and how Banksy is responsible for this new trend.
Cryptocurrencies, blockchain, these words are familiar to you. So we’ll not dwell on that now. If we compare the trading volume of NFT Tokens in February to all volume in the previous year, we’ll see that one month alone provided over 340 million dollars, which is bigger than in the whole 2020. Such an incredible growth has motivated many musicians and art creators to try new selling and distribution model. For example, according to the “Rolling Stone”, the next album of “Kings of Leon” will be released and distributed in the form of NFT.
Now, Banksy. That legendary artist has drawn a lot of attention to his figure in the last couple of years. Probably you’ve seen the video when his work gets shredded right after being sold on an auction. Now, Banksy sold his latest work called “Morons (White)” to Injective Protocol, converted into NFT (Non-Fungible Token), and burned to dust. That is the first ever recorded example of converting a real-world existing art piece into fully digital, but still valuable form. “Digital image of the object of art”, as they call it. Later, this token will be sold for cryptocurrency. As you can predict, the initial 95k investment can turn out to be a great profit.
What is Non-Fungible Token?
To every person that does ot know what an NFT TOken is, here’s the simple explanation. As you probably know, every record in the blockchain system is called “Token”.However, in usual open blockchain all Tokens are equal and replaceable, which means that every token can be replaced with any other without any issue. However, that won’t cut it for artwork. So, in 2017, on the basis of smart-contracts of Ethereum, NFT tokens were created. In contrast to usual tokens, NonFungible ones can’t be replaced, faked, or divided without leaving a trace in the system. Every token is unique, which makes it perfect for securing rights on any art piece, or any digital item, like items in computer games. If you love numbers, here you go: more than 5,4 million tokens have been sold since 2017.
Where are they used?
As I previously mentioned, in February NFT have conquered the sphere of art. For example, Elon Musk’s wife, popular singer Grimes, sold over 400 tokens, tied to hers and her brothers drawings. This action brought her over 5.8 million dollars in less than 20 minutes. Another example – 3LAU, who was the first music creator, who tokenized the whole album. These limited-edition tokens were later sold for over 11 million dollars. And this trend is only starting. In just a few years all art on the Internet or real life will be digital, and NFT-based.
Also, the latest cases of NFT use confirm the growing popularity of NFT in computer games, real-estate business, domain-name registration services, etc. And the number of such use cases is only growing every day. Now it’s time for you to convert your tracks on Spotify (if you are a musician) to NFT. But don’t forget to promote them with the best promotion service. Brave new world!
How to NFT?
Quite a strange way to phrase the question, agree. Sue me. But if you are an artist, who wants to tokenize your work, I can suggest two platforms – OpenSea and Rarible. There you can not only tokenize your work of art, but also purchase your first Token from another artist. The only difference between those services is in their token-generation. OpenSea will create a token only after there is a buyer. Thanks to that, the creator pays no additional commission on Ethereum network. Rarible, on the other hand, creates the token instantly after the upload, requiring more money from the artist.
The future of Non-Fungible Tokens
According to experts from Xena Financial Systems, the implementation of NFT can change copyright control once and for all.NFT make every interaction with art and music easier. No more pain for radio and streaming services, they will be able to get content fast and easy. No need for contracts with hundreds of pages – just buy one token, and you’re good to go. However, the process of implementing such a technology is not fast, it could take years before we will see some real changes.
Token-based operations are faster, more secure, than any operation with real goods. THere is simply no reason not to implement such technology, especially if it benefits everyone. So we can probably see even more rapid growth of the NFT and its capitalization, up to 4 times of what we currently have. That is promising, and sounds quite realistic, especially considering the growth in the last months.