NFTs, or non-fungible tokens, have grown in popularity in just a matter of months, with some selling for millions of dollars. Here’s how it could affect the collectibles industry.
Video Transcript
BIANCA FLOWERS: NFTs have taken the art and entertainment world by storm. In the rapidly evolving crypto economy NFTs or non-fungible tokens are now a hot commodity. Simply put, non fungibility means that digital assets can be of the same kind but they’re not interchangeable. Unlike a $10 bill that can be swapped out for another $10 bill and the value won’t change this is the opposite for NFTs.
For example, when art prints are made, bought, and sold they don’t hold the same value as the original piece of artwork which makes them fungible. Largely built on the theory blockchain, NFTs are official certificates to prove ownership of scarce digital assets. These can include virtual art, music, and yes, even memes. Here are three collectible industries NFTs are reshaping.
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For years gamers have spent billions on video games without ownership rights. NFTs grant property rights. That’s something that gamers have never had before because in traditional games the publisher owns the game assets and just licenses them out to the player. While NFTs have the potential to be profitable to game studios and publishers the biggest revolution is that players will have ownership of their in-game assets.
Gamers who own NFT assets can make a profit by selling their in-game rights on blockchain marketplaces. This can happen when a player’s license for a specific game gets suspended or if they just choose to stop playing the game. The player can take their assets and move to another game or just sell them.
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NFTs are changing the game in sports. Literally, from crypto-backed fantasy games to a fan owning a virtual seat in a stadium, NFTs are touching every corner of the sports world. Dapper Labs creator of NBA Topshop has positioned itself as the premier NFTs sports car trading platform. By creating official agreements with sports rights holders and professional league owners users are able to buy and sell moments. They’re basically virtual sports cars but instead of getting a picture of a player with statistics on the back you can get a video highlight of the play. A clip of LeBron James dunk sold for $208,000.
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NFTs are also igniting a digital art boom. Virtual art has been around for years. But the recent buzz and endorsements from celebrities about the NFT marketplace have offered a new way for digital artists to profit from their work. A digitized work of art created by an artist known as Beeple sold at Christie’s auction for nearly 70 million, a record breaking number for a new art form. And crypto art platforms like Nifty Gateway are luring in a new generation of collectors to become owners of some curvature digital artworks.
One of the reasons NFTs have boomed in the art world is because of the unique way they can be authenticated. NFTs carry digital signatures that can’t be copied. That allows users to determine whether the product they own is genuine. NFTs are still relatively new. So it’ll be a waiting game to see if this crypto asset will continue to be a solid investment.
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