Week 7: Non-fungible tokens (NFTs)
You've probably heard about NFTs in the media during the last couple of years whether in the form of the 'Bored Apes club' selling for millions or 'Beeple's Everydays the first 5000 days' selling for $69.3 million at Christie's a few years ago. NFT mania has been everywhere but what are they and why are they important..?
NFTs represent ownership rights to a unique digital or real-world asset.?They can be used to make it more difficult for digital creations to be copied & shared.
Brands can offer NFTs alongside real products & services which can be ‘updated’ with offers in the future.?NFTs can also be exchanged or sold through digital wallets so self-custody (like crypto) is an option too.
Their use-cases are numerous & to date, we have only seen the tip of the iceberg, mainly in a speculative form, but things are about to move up to a new level.
NFTs & Web 3.0
Before we continue, it's important to understand where NFTs fit into the bigger picture that is Web 3.0 of which there are effectively four pillars - crypto, NFTs, DeFi & the Metaverse.
Web 3.0 puts users back at the forefront of the web experience by facilitating ownership & control of data & value. This is a fundamental shift away from the Web 2.0 model which has been dominated by big tech. Remember the phrase "If you're not paying for the product, you are the product"?
Fungibility
Let's get back to NFTs & at a root level, first, we need to be reminded of what fungibility is.
NFTs are therefore a powerful use-case of blockchain as they allow content creators to prove ownership rights as an example. The business applications of NFTs are just starting to become clearer from certificate authentication through to supply chain, the metaverse & beyond!
Four concepts to understand
So, now we understand these concepts, let's look at how to create (mint) an NFT.
领英推荐
Minting in 5 steps
Important: Your digital wallet allows self-custody of your digital assets including crypto & NFTs. Do not reveal your private key or seed phrase to anyone as this could result in your assets being stolen & lost forever.
Big brands leveraging NFTs
Coca-Cola & Nike are two brands which have jumped head first into the NFT space with Coca-Cola going with vintage collectibles which raised nearly $575,000 in an online auction & Nike embarking on a digital collectibles initiative called dotSwoosh aimed at selling unique Nike shoes for the Metaverse!
Takeaway
Looping back to what I said earlier, NFTs are here to stay & once we get through this early speculative stage, they will likely evolve into some very useful & meaningful applications that will be valuable to us in ways we can't even imagine now.
As well as a revenue generator, NFTs are a fun way to foster customer engagement & coupled with social media, this is a powerful driver for many brands that'll be hard to resist.
Disclaimer
This series of newsletters complements the weekly blocklunch45 sessions and is for educational purposes only as my mission is to educate as many business leaders, entrepreneurs and consultants as possible about the miriad of amazing use-cases of blockchain. It is not financial advice in any shape or form and the examples given are to illustrate the content only.
If as a result, participants and / or readers decide to invest on any of the companies or brand names mentioned, then that is entirely at their own risk. Please do your own research (DYOR).
If you are interested in joining the blocklunch sessions then please email me at [email protected].
Jeremy Williams.