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Hiral Patel, May 4 2021

The Hype Is Real: NFTs Explained

You might have seen the word “NFT” pop up on your feed recently, maybe on Reddit, Twitter, or your local finance bro’s Instagram. The term NFT might be new to some, and for those with more questions about them, you’ve come to the right place.

A non-fungible token (NFT) is a unique digital asset, a one-of-a-kind that cannot be duplicated. Using the same blockchain technology that cryptocurrencies like Bitcoin and Etherum are built on, these digital tokens are stamped with a serial number that gives it its uniqueness from all other NFTs. As a result, tokens can be bought and sold with confidence. The blockchain network tracks every transaction so the chances of scamming are low. This is a game-changer for creators, who before blockchain were unable to easily verify their digital artwork and sell it online. Simply put, with blockchain technology, a creator can give their asset a unique stamp that cannot be replicated or duplicated by anyone on the market. As an added bonus, the artist can collect a commission on every future transaction of their work - because the blockchain will connect the asset back to the original creator.

Anything on the internet can become an NFT. The opportunities are truly endless - one of the first tweets ever? Sold for 2.9 million. Want to own a meme? This one’s yours for about $500 000. Or maybe you want to own a LeBron James dunk highlight. You can cop this one for only $387 600. You can turn anything into an NFT - as long as there is a way to authenticate it so buyers know the token is legit. That’s how platforms like Opensea have become popular markets for buying and selling NFTs,  allowing a user to certify their own digital pieces and turn them into an NFT.

NFTs are gaining momentum in the world of art, entertainment, and sports. Artists and athletes are now able to virtually sell their digital artwork and likeness, connecting with their fans in a brand new fashion. As concerts and sporting events closed their doors to crowds (still closed depending on where you live), fans yearned to stay connected with and support their favourite celebrities and influencers - the NFT space made this happen. Fans can now own their own piece of authentic digital memorabilia and even access exclusive content.  Just take a look at Auston Matthews, who recently auctioned off a 107 piece NFT collection for almost $200 000 - donating a portion of the funds to Sick Kids Children’s Hospital in Toronto. What is unique to note about Matthews’ auction is that some of his NFTs came with physical autographed merch, giving fans more value for their token purchase.

To many, the concept of an NFT makes no sense. Why buy a picture or a video that anyone can just download and save to their devices? There’s value in the authenticity of it. There’s fun and hype in owning a one-of-a-kind digital token that is backed by your favourite artist, athlete, or celebrity. No matter how big or small the star, anyone can get into the NFT world, and fans can support their favourite talent. Part of the excitement is where NFTs are going next. Artists are finding new ways to give their fans exclusive content, and diehards are all in. Just last month, the Weeknd released an NFT with a song that he will not release on any platforms - giving one lucky fan the ownership of an exclusive track. The potential can go much further, and the world is beginning to take notice. 

As the popularity of cryptocurrencies grow, platforms for buying and selling NFTs will grow with it. NFTs are here, and they’re here to stay. In the words of Billy Beane’s character from Moneyball:

If you’re looking for a fun way to get into the new age of blockchain and cryptocurrency - NFTs are a fun and exciting way to make a splash. Who knows, maybe you’ll even find a “white whale” in the “opensea” 👀.

Photo Credit: Live Auctioneers, OpenSea, The Guardian

Video Credit: YouTube/ Smith & Partners

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Hiral Patel

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