HISTORY OF NFTs

 

History: 

Non-fungible tokens (NFT), or just tokens, are a type of digital assets stored on a blockchain. Each NFT is one of a kind, no one token is identical to any other token and cannot be traded for an NFT of equal value. NFTs go back to the first days of crypto, the first time people called them NFTs was in 2017 when CryptoKitties was released on the Ethereum blockchain.

Using ether, the cryptocurrency of what is now the most popular public blockchain, Ethereum, users can buy, sell, and incubate ‘cats’. An NFT represented each CryptoKitty, and the popularity of the game caused NFTs to go from niche to full blown white elephant. Ever since then, NFTs have been used to represent everything from art to music, videos, and much more.

That year, the first major NFT art sale was Kevin Abosch on the Ethereum blockchain for over $1 million. Then in the following year an NFT artwork by artist Robert Alice was sold for more than $100,000 at Christie's auction house.

The COVID 19 pandemic forced art galleries and museums to close and lock many artists and collectors into digital platforms to show and sell their work. In March of that year, Beeple, the digital artist, sold a $69 million NFT artwork at a Christie's auction, smashing a record for a digital artwork sale.That being said, on December 2nd, 2021, the Merge became the most expensive NFT ever sold as almost 30,000 collectors rallied to pay $91.8m for one.

The applications for NFTs today go beyond collectibles, virtual real estate and gaming items. while the market for NFTs is still relatively new and volatile, many experts believe that they represent a significant shift in the way that digital assets are valued and traded.

What is the main objective of NFTs?

NFT stands for non fungible tokens, which is the main objective of NFT itself to give proof in the form of a digital token of the unique asset that you possess that cannot be replicated nor change for the value of another token representation of the same asset. Digital art, music, videos, and even other creative content that people can value and own – but it’s hard to monetize and protect yourself from copying, or unauthorized use – often use NFTs to represent it.

Here are some main objectives of NFTs in points:

1.Offer a means of tokenizing unique digital assets beyond 1:1 replacement for another token of equivalent value.

2.It enables creators and collectors to secure a verifiable, useable record of ownership, and transfer ownership of their digital assets.

3.Enable you to securely and transparently sell and trade digital assets.

4.To help creators monetize their digital work in new and innovative ways.

5.Create a new digital collectibles market and other unique digital assets market.

6.Give value to unique, 'digital' assets that were otherwise ephemeral or intangible.

7.Change the way we think about ownership and value in a digital age.

8.Facilitate new types of creative expression and interaction in the digital realm.

What is the scope of NFTs in future?

The scope of NFTs in the future is still uncertain, but there are several potential areas where they could have a significant impact:

1.Art and Collectibles: But NFTs have already disrupted the art world by allowing the possibility to sell and trade digital artworks. The trend is likely to continue as NFTs will be used to represent unique collectibles of all kinds — starting with virtual real estate and gaming items.

2.Gaming: NFTs are also likely to become a big part of the gaming industry in the future. By extension of this technology, NFTs combine many powers—a way to represent in-game items, characters, or even the whole game world, enabling gamers to own and trade digital assets.

3.Music and Media: In addition to revolutionizing the logo industry, NFTs could also change music and media industries, enabling them to serve as a new means of selling and trading digital music, videos and other kinds of media. So this may solve issues these industries have faced in the digital age like piracy and you are able to monetize digital content.

4.Virtual Reality: With virtual reality on the increase, NFTs could permit the representation of unique virtual objects and virtual experiences like virtual real estate, fashion, even social experiences.

5.Identity and Authentication: NFTs could be used as a way to establish identity and ownership verification for physical assets — luxury goods, collectibles and real estate even!

In future, the scope of the NFTs reach will be vast, as they can be used in almost all the industries and use case. But, of course, like any emerging technology, there are many uncertainties and challenges that must be addressed along the way.

Why are NFTs so expensive?

NFTs, or non-fungible tokens, can be expensive for several reasons:

1.Scarcity: NFTs are trying to represent unique digital assets that cannot be reproduces nor be traded for the same value of another token. That means there’s a finite number of each NFT, and that can simply lead to higher demand and higher prices.

2.Value of the underlying asset: An NFT can sometimes be worth what the underlying digital asset it represents is worth. If the digital asset is valued by the collectors or investors, the NFT which represents it is valuable too.

3.Perceived value and market sentiment: NFTs are like any other asset, so its value depends on how the market feels about it and the value that people put in it. The value of a particular NFT can increase if that NFT becomes known or highly popular with influential people or organizations.

4.Brand and reputation: There are some NFTs that are owned by famous people like artists, musicians, and celebrities, which can give them more value and demand.

5.Auction dynamics: In most cases, NFTs are traded at online auctions, generating a bidding dynamic that forces up the price as bidders compete to purchase a finite number of NFTs.