Fung

Cryptic collectables: NFTs are having a pre-mainstream, mainstream moment

Monday, March 22, 2021 by Robinhood Snacks |
_Googling: "How to NFT art heist"_

Googling: "How to NFT art heist"

Can't funge this... What do Jack Dorsey's first tweet, Nyan Cat meme, and a viral skateboarding TikTok have in common? They're all NFTs, aka: non-fungible tokens. NFTs are like one-of-a-kind trading cards (but digital) — instead of living in a glass case, they live on a crypto blockchain. But unlike bitcoin and other currencies, they can't be exchanged like-for-like. Hence, "non-fungible." You can trade $1 for $1, but you can't trade Dorsey's first tweet for Dorsey's first tweet (you can sell it for $2.5M, though).

Nyan Cat is a crypto star... so are Logan Paul Pokémon cards (really). NFTs can be tied to any digital asset, from songs to video clips. And they’ve been tied to physical objects, too (see: Nike CryptoKicks). While they've been around for years, NFTs have blown up recently — especially in the art world.

  • $69.3M: How much an NFT jpeg by Beeple sold for at a Christie's auction earlier this month. Now he's one of the three most valuable living artists.
  • $6M: How much musician Grimes got for 10 NFTs of digital art.

Fungible flex factor... NFTs certify your ownership of the original asset... even though everyone can see and download the same Beeple jpeg for $0. Also: the artist can retain all usage rights to the work. While buyers don't get paid from views, they do get the knowledge that somewhere in the blockchain their name is written in permanent crypto Sharpie on an asset. And if the hype continues, they might be able to sell their NFT at a profit (but it could lose value, too).

THE TAKEAWAY

NFTs could revolutionize the creator economy... if they become more than a fad. There are already marketplaces that allow people to buy and sell NFTs, including Nifty Gateway and OpenSea (which just raised $23M in funding). NFT creators can even enable a feature that gets them paid each time their work changes hands. Now, smaller artists are NFT-i-fying their work. And people are willing to shell out $$$ to claim ownership and support their fave creators: the NFT market quadrupled to $250M in 2020, and has soared this year. If they stick, NFTs could be a new avenue for creators to monetize their work.