The world of crypto assets is no stranger to strong opinions or reactions, fans of the technologies love it dearly and doubters hate it with a fiery passion.
Whether you love them or hate them you can’t deny that NFT’S are the latest big thing, many believe the widespread adoption of NFT’S is not a matter of if, but a matter of when.
But if NFT’S are the future what does the future look like and what do they do in the first place?
Good question my friend and that’s why today we’re going to be looking at how everyone will end up using NFT’S.
I think it’s best if we address the elephant in the room, what is an NFT?
If we want to understand the potential of NFT’S we must first talk about what they are, so what is an NFT?
Well, the term stands for non-fungible tokens, and their units of data stored on digital ledgers or what we know as blockchain technology.
Errr Adventago I have even more questions now… No worries I’ll explain this in even more detail, when something is fungible it means it can be traded or replaced by another identical version of the same good.
Money and stocks, for example, are fungible goods, you can have 100 bills of $1 and they’ll all hold the same value and the individual stocks for a particular company are all worth the same.
Following this idea of a fungible token would be 1 that shares the same value between other tokens of its kind like cryptocurrencies, 1 Ethereum coin has the same value for all the holders.
A non-fungible good on the other hand is 1 that is unique and irreplaceable, things like trading cards, land, diamonds, or art.
If you want to get fancy you could say that nothing is fungible, since everything is unique in its own way even 2 $1 bills, may have the same value, but they can have differences that make them unique.
But for the sake of keeping things simple, I will be using the basic definition, a non-fungible token, a token that is unique and irreplaceable.
There is a type of cryptographic token that is associated with digital or physical assets, no 2 NFT’S are the same nor do they have the same value, NFT’S are kind of like unique digital documents or signatures.
Now let’s talk about their use, how are NFT’S being used now?
Because NFT’S store data they can be associated with specific physical or digital assets, going a little further being unique data points means they can’t be falsified or replaced, combine the 2 and you get the most common use for them which is as a way to prove ownership or the right to use the assets.
Or at least that’s the idea, that’s the boring version, the interesting thing with is how they’re being used, the most common use for NFT’S right now is to sell them as digital art/as collectible items in the same way we do for the real world.
Here are a few crazy examples: Mike Winkelmann (Known as the digital artist Beeple) sold a collection of his work as an NFT every day’s the first 5000 days was the history of the artist’s work for more than a decade it was sold through the Christie’s auction company and reached an incredible amount of $69,000,000 DAMM!!!
Another common use case is the creation of NFT collectibles like trading cards, sports moments tokenized, and even digital rainbow flying cats.
One of these examples of these collectibles is the NBA’s top shop product, these trading cards created in collaboration with the dapper labs have digital pictures of players and specific moments and even re-playable highlights, one of these cards with a highlight from LeBron James sold for $200,000.
WOW, Adventago people making crazy money off weird Jpeg’s how does this add to the future? Alright now, I’ve got the groundwork out the way let’s dive into the deep end of things.
The future of NFT’S.
Now then let’s dive right in, shall we? Selling digital art and making them collector items is an interesting use for NFT’S, but it’s not the extent of what we can do with this technology.
Here are a few things these great pieces of technology can do, one of them being…
1. Tickets
One way in which NFT’S can be used to great effect is in the ticketing industry.
To you, that might not sound like the most exciting revelation but one of the biggest issues with tickets for sporting events, concerts, and even flights tend to be the issue of scalpers and counterfeiting.
If tickets were NFT’S you wouldn’t have to worry about your ticket being original or not.
The BBC made an article and it said: Ticket fraud: Victims lose over a million pounds, Victims of ticket fraud are losing an average of £365 each, a new report has found. In the last 12 months, nearly 5,000 people reported being scammed when trying to buy tickets. Source: https://www.bbc.co.uk/newsround/48853780
But if you can easily verify who owns the ticket and its authenticity that wouldn’t be a problem, tickets could also be made non-transferable preventing them from being sold and that way eliminating the incentives for scalping.
2. Virtual Documents
Another use of NFT’S could be virtual documents, let’s face it right now you can write down pretty much anything you want on a resume and an employer would have to go through a lot of trouble to verify all of it, don’t believe me just ask Christopher Mastermind AKA “THE MASTERMIND” 😂😂😂
But if our documents like licenses, IDs, diplomas, even passports, were NFT’S it would be simple to verify that information, and not only that it would be practically impossible for someone to pretend to be you as part of a scam or fraud as it would be quite easy to check the legitimacy of their claims.
In the same way, NFT’S could be used for the real-world such as for cars, and real estate, this can prevent issues of people trying to sell things they don’t own like those cases of people finding out their homes were sold by scammers.
3. Gaming
Cosmetic purchases are already common in the gaming world, new clothes for your character to wear, special effects for weapons, and virtual pets are some of the things you can already buy-in games.
But when you buy these things, you can only use them in one game, but imagine being able to take them anywhere you go, that’s one of the dreams for NFT’S being able to purchase these items and take them with you anywhere you go.
Plus being able to trade them outside of the game itself, however, this would require a level of cooperation between gaming companies that we aren’t so sure we’ll see anytime soon.
Now let’s look at some of the problems with NFT’S.
You’ll hear a lot of buzz around NFT’S and how they’re great for artists and collectors and countless others, the truth is there are some issues with the technology.
Before we can see some of the uses, I’ve talked about shine and especially the future ones we need to solve a couple of problems.
1. Cost To Create
Right now, most NFT’S are made on the Ethereum blockchain, this makes them rather expensive to create because of the mining process and associated fees, while mining might have been relatively cheap at first the cost is quickly gotten out of hand.
This leads us to another problem which is…
2. Sustainability
The act of creating an NFT is not only expensive but ridiculously inefficient energy-wise, mining an NFT through proof of work requires a lot of power.
It won’t be sustainable in the long run, both of these problems can be solved by moving to other blockchains that are less energy-intensive and using other mining processes, but the same cannot be said for our next point.
3. Difficulty Of Use
Right now, making an NFT isn’t super easy, if the technology wants to gain more widespread adoption it needs to be, luckily this is mostly a short-term issue that will be resolved as the tech evolves.
The first 3 issues all arise in ways NFT’S are created right now but the last and probably most conflictive one is the issue of ownership…
4. Ownership Of The Asset
NFT’S are supposed to prove that you own an asset, but the truth is that people can easily download the data that an NFT points to.
A lot of NFT’S are more of a status symbol than an owned asset, since anyone could easily replicate that without much legal replication, if NFT’S want to be taken seriously this is going to have to be fixed somehow.
5. Link Degradation
Because NFT’S can’t store the entirety of your digital assets just link to it with literal weblinks, what happens if those links break? Well, then you own a very expensive 404 error page.
In conclusion
NFT’S are interesting if more than a little bit confusing, the potential of the technology is definitely something to keep an eye on even if you’re not interested in digital art galleries or collectibles.
What we can’t deny is that as the interest in crypto, the metaverse, and the evolution of virtual spaces grows, so will the adoption of NFT’S.
The technology isn’t perfect and there are some pain points to resolve before it can become what it claims to be, but with the constant push from big brands and industries, NFT’S will inevitably become more widely adopted.
Thank you for reading this blog post, I massively appreciate you taking the time out of your day to fill your brain with something that will inspire you to be more in life and give you the boost you need to keep pushing towards your hopes and dreams.
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He is the Host of The Crypto Factor Podcast | Co-Founder of Bitbullz.io | Author | Blockchain & NFT Consultant | Cancer Survivor & Marvel Fan. #Bitcoin
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