Unfungible chips or NFTs have become an overnight investment phenomenon with Sales of $ 60 million on Tuesday– Exceeding total sales for integral from 2020. An NFT is a type of cryptographic token used to make the digital environment unique and therefore collectible, whether it is a GIF or even a sports highlight. If you’re wondering why everyone suddenly forgot how to take a simple screenshot or is otherwise puzzled by this – you’re not alone.
What are NFTs?
Using blockchain technology, NFTs designate an official copy of digital media, which can then be sold by artists, musicians or sports entities to make money on content that would otherwise be cheap or free. NFTs are different from cryptocurrencies because they are not interchangeable – each is unique.
If you buy an NFT through a cryptocurrency market, it’s up to you to keep it in your digital wallet or put it up for sale on the market. When sold, all computers on a decentralized network record the transaction on a shared registry, which is, in fact, a certificate of authenticity that cannot be modified or deleted.
NFTs have a wide range of uses, including collection sports cards, digital art and virtual real estate. On Yahoo, brands like NIKE, Louis Vuitton, and the NBA have already begun generating NFT-based assets, with the NBA launching a dedicated collection site called NBA Top Shot. Last week, artist Chris Torres sold a unique version Nyan cat, a popular meme of a flying cat with a Pop-Tart body that leaves a rainbow mark, for the equivalent of about $ 580,000, according to the New York Times. Rick and MortyJustin Roiland also has jumped into NFTs.
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Why would anyone spend money on this?
It may seem bizarre to buy the “authentic” version of something that you can easily remove from your desktop, but it’s easy to overlook the emotional value of the collection, especially when it comes to original art. Part of the appeal is owning an authentic article created by an artist you like and the rights of praise that come with it. In essence, this is no different than owning an original Andy Warhol painting that can be displayed, sold or shared – it just happens to be digital. In addition, cryptographic art eventually unblocks the issue of artists’ payment, as creators can schedule these assets to pay them royalties every time the collector is sold.
Moreover – and perhaps more importantly (if we explain the renewed interest in NFTs, which has been around for years) – people are increasingly seeing these digital assets as speculative investments, as they can be bought and sold in online markets (an NBA Top Shot digital collection book by basketball star LeBron James recently sold for $ 100,000, e.g).
The increase in recreational investment during the pandemic is probably also a factor: most of these exchanges accept cryptocurrencies, of course, which meet the demand of individual investors who have stocks of cryptocurrencies and seek to spend it on something as fun as it is potential to earn more money later. It remains to be seen whether this interest will continue to support half a million dollar valuations for a flying GIF cat.