Non-fungible tokens (NFTs) can affect the development of the cryptocurrency market and the situation with copyrights.
NFTs have been in the news a lot last time, drawing attention to this part of the cryptocurrency industry. Grimes, a Canadian singer, Elon Musk’s girlfriend and mother of his child, tokenized her collection of paintings called “WarNymph” and raised $5.8 million for 10 NFTs to which these artworks are pegged. One of the paintings, by the way, depicts an infant very similar to Musk’s child defending Mars, the planet that Musk is about to colonize.
Right now, until March 7th, there is an auction for the sale of the tokenized work “Morons (White)” by the famous artist Banksy. The auction is being conducted by Injective Protocol, which bought the 350th of 500 prints of this artwork from the Taglialatella Gallery in New York for $95K and burned it in live-stream on Twitter, having previously released a non-fungible token (NFT) on the OpenSea platform.
The print has been validated by Pest Control, the only organization in the world that certifies Banksy’s authorship. So far, the auction bids have not risen above $10K, but the company is confident that it will make a profit. The piece depicts the moment of an auction for the sale of paintings, and in one of the frames is placed Banksy’s own handwritten note “I can’t believe you morons actually buy this shit.”
Perhaps NFTs could be the equivalent of investing in art in the real world. NFT is a way to digitize real assets. But like any digital asset, it is also a way to invest funds in order to make a profit. NFTs cannot be divided into shares and retain their uniqueness, as well as the uniqueness of the real asset. You shouldn’t burn the tokenized asset for sure, it can be located in the same place where it was located – for example, in a museum. And the NFT price will rise along with the price of the painting. And at the same time the NFT helps to confirm the authenticity of the artwork.
In addition to art, non-fungible tokens are used in the gaming industry. Here, players can safely buy tokenized artifacts that retain their value in the gaming ecosystem. With the NFT the player can even earn money if the artifact becomes more expensive.
NFTs can also be used in the real estate market, especially in luxury real estate trading. In general, a number of analysts are confident in very good prospects for this segment of the cryptocurrency market. Since no one can reverse the digitalization trend, the digitalization of real assets will also go on.
In February, NFT trading volume was $340 million, which is more than in all of 2020. Mason Nystrom, an analyst at research firm Messari, claims that in 2021, the market capitalization of NFT will increase 3-4 times.