On May 22nd 2010, Laszlo Hanyecz paid for Two Large Papa John’s Pizzas with 10,000 Bitcoin. Today, that would be £ 366,969,741.20 worth of pizza. Even despite a quick dip in price earlier this month, it’s become clear that bitcoin and the crypto world have cemented themselves as the future of transactions. Crypto investors are very different from your wall street types, they’re always looking for the next big trend. From Ethereum to $GME, the home-grown investor has become a powerful economic force. The next trend in crypto investment is the NFT. Non-fungible Tokens are already making millionaires seemingly every few days, and showing signs of continued rapid growth as the days march forward. But what is a Non-Fungible Token, and how can you capitalise? Learn more below.
What is a Non-fungible Token
Picture a bustling marketplace. Fine art, land deeds, collectables and trinkets of all kinds being handed out to the highest bidder. Trades in countless commodities, from the rare to the mundane, taking place everywhere you can see. Now imagine this on the internet. Your first thought was probably eBay, where auctions on physical goods occur online.
NFT services such as OpenSea.io take the online auction one step further. Now, not even the items being auctioned are physical. An NFT is a good that only exists on the internet. At present moment, these range from everything to Online Art to Bitcoin wallet addresses. Using crypto and blockchain technology, clever investors have found a way to create rarity online.
…Why??
This was our first thought too. Who on earth wants a unique gif, or a pretend F1 Boot (yes, that’s a real NFT that’s just been released.)? I can save an identical copy with a right-click. In fact, here’s a piece of art worth Ξ1.2051 (Ethereum). That’s £1,388.44, for free.
Except that’s not really the piece of art is it? Sure it’s a copy, and an identical one at that, but I have no proof it’s the original copy. No one will buy it, not without being duped, and therefore it holds no real value. So if my version is worth nothing, how come the real one is? Let’s compare this to “real”, physical art.
Here’s the Mona Lisa, taken from Wikipedia. It’s the same art, the same brushstrokes, just in digital form. The real art was assessed at $100 Million in 1962, making it an $850 million-ish piece today. Of course, this copy and pasted image is worth nothing. Even if the Mona Lisa magically burnt away, my version would still be worth nothing. Originality will always come at a premium, regardless of where and how the original version exists. As long as you can prove you are the original owner of an authentic item, that scarcity is worth something to those interested in the item.
How do you make a Digital Good Unique?
In one simple word: Blockchain.
You’ve probably heard this latest buzzword “Blockchain” thrown around by every startup in recent years. But what actually is it? A “blockchain” is a digital ledger. Every Cryptocurrency, or in this case NFT, has a unique identifier. This identifier is tracked. Every wallet it moves to, every purchase it’s used in, can be followed. Whilst one will struggle to find the real identity of its eventual owner, you can easily confirm the location of the cryptocurrency or NFT you’re tracking.
Let’s go back to our friend M.Lisa for a real-world example. If I wanted to prove I owned the real Mona Lisa, I’d make sure to get proof the transaction in which I bought it existed. I’d want to buy from a legitimate seller, who I’d likely ask to write a certificate of Authenticity. The Blockchain removes the need for the certificate, it’s an unbeatable proof of legitimacy.
Who is trading in NFTs?
Right Now? Everyone. In Six Months? Who Knows. Internet Artis Beeple is having NFT artwork sold for millions. The NBA is selling off it’s legendary dunks, 3 pointers and more for millions. Football teams Juventus and Bayern Munich sold their image rights to Sorare, who are now selling digital football cards for thousands apiece. The justifications for this insane spending ranges from the obvious to the optimistic. Many are looking to capitalise on a bubble so lucrative you’d be a fool not to. Selling intangible goods with little to no production cost at fine art prices is every entrepreneur’s power fantasy.
Many, however, are entering the NFT game with a glimmer in their eyes and cash in their bitcoin wallets. Their reasoning is logical. We spend more and more time online, and this trend seems to be continuing as the pandemic forces more indoors and the growing VR industry looms on the horizon. Why not get in the game early, and own an item that could be worth billions in your VR living room? Why not buy a virtual plot of land in Decentraland, perfect for your VR eCommerce store? Their future looks bright, but many argue that NFTs are a bubble soon to pop. No matter which side you’re on, it’s clear money is there to be made if you capitalise now.
How Do You Capitalise?
NFTs live and die by Digital Marketing. A good site to show off your new collection, a social media push to get the collectors in a frenzy and a top page Google ad that’s ready to grab the attention of every hopeful investor could turn you into a millionaire before this bubble bursts. Wildfire Marketing, the number one SEO Agency in Leeds, is ready and willing to take your Digital Marketing to the next level. With a combined team experience of over a decade in email, social media and web development – we are the perfect choice for getting your business online in time for this Non-fungible Token craze. Contact us today and begin your Digital Marketing Journey.