NFTs: the next big thing or a fad?

NFT, LEGAL

Author: Nikita Kosmin

 

Snimok ekrana 2022-07-11 v 9-17-15

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The meteoric rise of NFTs needs no further introduction, considering how valuable they have become in recent times. But do you know who created the first NFT?

 

NFTs were first introduced as Colored Coins in 2012, designed for issuance on Bitcoin since Ethereum had not yet been created.

 

NFTs are officially on the market, and since the success of projects like CryptKitties and CryptoPunks, they have been the talk of investors and even large companies. But before you put your money into these tokens, you should know how useful they're and whether their value will increase in the coming months and years, which is what their long-term success will depend on. 

 

How much do you actually know about the technicalities? Would it surprise you to find out they’re almost as old as Bitcoin? What else should you learn before you decide if you should get involved?

 

NFTs: fundamental analysis

When Bitcoin hit the market ten years ago, few people saw the revolutionary potential of blockchain technology, which enabled completely decentralised trading of cryptocurrencies. But as time went on, more and more realised that the blockchain's ability to bring smart contracts to the world would change the way we do business forever. Now it looks like non-fungible tokens (NFTs) could have similar potential. Are NFTs the next big thing or just a fad?

 

What are NFTs? 

NFTs are digital assets that are unique and non-exchangeable. Like Bitcoin, they're stored in a blockchain and can be used as proof of ownership for anything from digital art to gaming items. Unlike Bitcoin, which is intended to be used as a currency, NFTs have no inherent value. Their value depends solely on what someone is willing to pay for them.



Crypto Kitties - The First Successful Game Using Blockchain Technology and NFTs

In late 2017, CryptoKitties took the world by storm. The game, which allows players to buy, collect, breed, and trade digital cats, was one of the first to use blockchain technology and NFTs. 

 

Since then, NFTs have been used in a variety of games and applications, from digital art collections to in-game items. There are now NFTs that have made their owners millions, as well as those that have lost millions, NFTs that represent art, semi-fungible NFTs, NFTs that can serve as a ticket to a night of partying on a yacht, and NFTs that have been successfully stolen or lost. That’s quite a history! But the most important question is: should youtake them seriously long-term?

 

That depends entirely on their value, i.e. their use. Bitcoin became so popular because it was colossally useful to businesses around the world who wanted to protect their assets (that's not a typo), to users who wanted to make financial transfers in minutes, not days, to geeks who were fascinated by the new technology, to the oppressed who wanted to break free from the yoke of the oppressive systems, and to dozens of other categories of fans. Whether NFTs will have as phenomenal a success will depend solely on their utility. 

 

In our opinion, NFTs are quite useful in that they can be used to prove authenticity, which will be a phenomenally valuable function in a world of rising crime. 

 

Whether NFTs will succeed in fending off the rising wave of hackers is another question. 

 

Given the staggering number of NFT thefts, counterfeits, and frauds, keeping NFTs secure will take some serious work. Perhaps with government regulation? Either way, if NFTs manage to make themselves as secure as the Bitcoin code, which hasn't been hacked once in decades, it looks like there's a very good chance they'll be phenomenally successful in the long run, because the market demand for authenticity is definitely there and growing at a geometric rate.


At Artessere, you can find out everything you could possibly need about NFTs, art, and crypto, and also get protected (read more about Artessree’s involvement with licensing and regulations here).

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