If you haven’t heard about Non-Fungible Tokens (NFTs) before then that’s okay. The gaming industry has already embraced this new technology. But cryptocurrency and the web are only just starting to pick up on the trend too.
What are NFTs?
NFT (or Non-Fungible Tokens) are crypto assets that are unique, non-divisible and indivisible. Due to those traits, they can not be replicated or faked by anybody. Assets can be uniquely identified and tracked within.
Crypto collectibles, trading cards or non-fungible tokens (NFTs) are virtual assets that are limited and cannot be copied or counterfeited. An example of this is a physical card. You cannot imagine duplicating it and displaying two identical cards in one place that do exactly the same thing. In the same way, an NFT cannot be duplicated.
The uses of NFTs
NFTs (also known as cryptocurrencies) are very similar to stocks. You may already know that investing in cryptocurrencies is highly speculative and there is no guarantee that your investments will go up in value. However, investing in art is not like buying a stock, where you can get a lot of exposure and possibly lose money. Instead, you get to decide what the market is going to do with your art, and you get to know it inside and out before anyone else does.
The example of $AXS
Each Axie is a non-fungible token (NFT) with different attributes and strengths and can be entered into 3v3 battles, with the winning team earning more experience (exp) points that are used to level up an Axie’s stats or evolve their body parts. These Axies can be bred together to produce new and unique offspring, which can be used or sold on the Axie marketplace.
As of this writing, Axie Infinity is:
- 1.05 billion in sales
- 490,000 total Ether (ETH)
- 2.5 million transactions
- 428 / 0.19 ETH per sale on average
- 490,000 unique sales
- Approximately 91,000 unique buyers in August 2021 with a peak of 215,000 in July 2021
A bright future for play-to-earn
These figures are one of the best ways to prove the attractiveness of play-to-earn games such as Axie Infinity. Play-to-earn games are on the rise. It's not for nothing that fundraising in the world of NFTs is rampant, with $476 million raised in the first half of 2021.
In the space of a few weeks, it is already possible to cite several important ones:
- A $20 million raise for the NFT game Zed Run
- A $12.5 million IDO in 32 seconds for Yield Guild Games (YGG)
- A $140 million round for Animoca Brands
- A $500 million round for Sorare
- And finally, Axie Infinity raised $7.5 million
The Nyancat artwork purchased via NFT for $500k
"I feel like we've opened the floodgates," Chris Torres explained in an interview given, dazed, after his nice move on Feb. 18, recounted by the New York Times.
Torres is the inventor, in 2011, of the Nyan Cat, a small angular cat joyfully riding a rainbow, arguably the most famous meme in global digital culture.
Like other memes, Nyan Cat has become a kind of commons of humanity's digital heritage, by nature endlessly duplicable, shared, copied, pasted and seen billions of times. Its possession eventually slipped out of Chris Torres' hands and the thing, in a way, now belongs to everyone.
But someone has acquired it. At an auction hosted by Torres on the digital auction site Foundation, the Nyan Cat was acquired for 300 ETH (for ethereum, the second most famous cryptocurrency after bitcoin) by a person whose anonymity is guaranteed by the blockchain.
300 ETH, or at the time of the sale a little more than half a million dollars : the floodgates have indeed been opened, and wide. But the fashion for collecting digital goods did not wait for this exceptional acquisition to be noticed, as the NYT and Wired explain.
Where can I buy NFT?
Buying NFT can be done in several ways:
- Through exchange platforms such as OpenSea, RareBits, SuperRare, Foundation.app, Sorare... specialized in secondary NFT markets.
- Directly from their issuers, on the platforms of the projects themselves. In this article, we review some concrete examples.
Where can I sell NFT?
First of all, you need a cryptowallet, a virtual wallet that allows you to use cryptocurrencies (like Trust Wallet, Metamask or Rainbow. All transactions are, at one time or another, carried out on the blockchain: the Ethereum blockchain, where the vast majority of NFTs are produced, or on the Flow blockchain, or Bitcoin Cash.
The sale of NFTs is facilitated by numerous sites that deal with tokenization. Tokenization is the process of saving a copy of the file you want to sell to the blockchain, creating a unique coin that cannot be replicated. This is the process that also allows you to claim ownership of a file. Once your NFT is registered in the blockchain, that's it, you are now the sole, or only, owner. It is interesting to note that the process is not always free: on some sites, you will have to pay the gas price, that is to say the cost of the transaction on the blockchain. And like gasoline, its price varies: on March 23, 2021, a transaction cost between 7 and 8 dollars.
The sites that offer tokenization of virtual objects also serve as a marketplace and modern auction houses. You can put your NFTs directly on the market - or keep them for yourself.
The future of NFT
The future of NFTs seems rather bright to replace that of current art. At least, that's what this market is predicting in 2021. The uses of NFT seem to be endless and many companies are innovating in this field.
The polygon example Polygon Studios : The studio already has extensive partnerships with legendary video game publisher Atari, as well as digital real estate projects Decentraland and The Sandbox. OpenSea, NFT's platform, has also answered the call.