NFTs - Helping right owner get the right price
Imagine, you being the sole owner of your creations and getting duly paid all the royalties whosoever consumes your work, anywhere in the world. NFTs make it possible. Read on how!
I have a small bat signed by Virender Sehwag which I was lucky to get in the year 2005 when the Pakistan Cricket team was touring India. Sehwag was my superhero at that time and that bat was priceless for me which I have kept preserved till now. Getting to sign him live at Green Park Stadium with all emotions running high due to it being India-Pak ODI, nothing can replace it with something else today. In short, it’s “non-fungible”. On that day, I even had 2 notes of INR 50 which my cousin exchanged by giving me 1 note of INR 100 because he needed some change to buy water bottles. Hence, those 50-rupee notes were “fungible”. In nutshell, fungibility is something which allows some asset to be exchanged or substituted with something of similar value. It may sound astonishing, but this property of fungibility has today given rise to a new asset class known as NFTs (Non-Fungible Tokens).
We had simplified Bitcoins for you a few months back, and similar to Bitcoins, these NFTs are also a type of cryptocurrency. But unlike Bitcoin, these NFTs are non-fungible i.e. you cannot have a benchmark universal value of NFT which can be exchanged for dollars. Every NFT is unique in itself. And now you may be impounded by a lot of questions, how do you identify its authenticity, how can you know the real owner or its previous owners, etc.? All these questions are totally logical, but NFT being a cryptocurrency, they have been totally taken care of. NFTs follow the same principle of Blockchain i.e. each transaction is recorded which is irreversible, and are encrypted with a string of letters and numerics which store all the information of the current owner of it, who has sold it, when was it sold, etc. It’s just like a digital signature which gets stamped at the time of transaction and now nothing similar can exist – Same way as that Sehwag’s signature is to me. It’s unique and non-fungible so definitely can carry any value that one may deem appropriate to them.
Next question would be, all this is fine but how is this NFT revolutionary in common person’s space? So, in the current scenario NFTs are bringing a revolution in the content and the gaming industry. Today, a content creator is bound to publish their work like an art, essay or a song on a media platform, where the artist gets the exposure, but it’s the platform that makes all the money through viewership and ads. Now imagine having ownership imbibed in the content itself. So, a buyer of that artwork has to pay to the creator directly for owning that work. Furthermore, the owner can decide on how many copies of an NFT should be created which would help to maintain that scarcity along with easy gaining of royalty. In the gaming space, one can gain heaps of royalties for their creations every time their own NFT marked item is resold. Being completely authentic and transparent in transactions, nobody can make false claims that this LinkedIn post is my original if it’s a copied one (A serious problem nowadays).
Recently, Jack Dorsey, the CEO of Twitter sold his first ever Tweet through NFT at a whopping $2.9 million dollars and just yesterday, an artwork created by humanoid robot Sophia was sold for $688K. Now that’s some real power to the creators. Some people have raised flags asking if the creations or the assets would be really worth that value or is it just a hype bubble being created - “Till now nobody really knows that!” But one thing is sure, knowledge always has maximum value and if you feel we help you gain the best of knowledge in the easiest of ways, then don’t forget to subscribe us:
By: Anmol Gupta | Isha Garg