How NFTs Are Performing In The Global Market
Their highest benchmark since their short span was in 2021, with $41 billion down the line. Their use-cases and participation because of it skyrocketed since then. The first quarter and the third quarter of the year proved to be a high point in their sales and engagement in trading. The invested NFT projects towards the end of the year proved to contribute to the sector’s engagement in early 2022. Since the new years – NFTs are set to multiply in their market value, considering the number of participants and opportunities. Still, there is no stopping the sector in technological advancement. Web3, AI, social media, P2P, and marketing are a few aspects of the NFTs trailblazing the new era of the division.
This article looks at NFTs, blockchain, how the platform serves as a decentralized space in context to revenue generation, advantages and disadvantages of investing in NFTs, and advancements in the field.
NFTs & Blockchain
Decentralized Blockchain Platform
The blockchain is the all-enticing technology in the recent history of tech advancements. They have revolutionized many sectors and have created many new ones – with countless jobs and possibilities.
History Of Block Technology
- The blockchain birthed the start of crypto – a safe and trusted way to transfer money and trade in the online space.
- Cryptocurrencies were also an asset on the blockchain; these acted as the currency through which the transactions and trade were made possible.
- Bitcoin was the very first crypto coin in existence. The decentralized platform also gave rise to the intelligent web – Web3 is the answer to the growing needs of social media interaction.
- The innovation of social connection through the web has made many industries shift their commerce and revenue stream to the internet.
- The platform is set to host a multitude of individuals residing and having a space on the internet to monetize and control their content.
- These monetization aspects can be reaped from the executive control and reign over their data and online presence on the internet.
- Data is today’s currency for every major conglomerate in existence.
Blockchain In NFTs
- Another major use case of the existence of the blockchain is the digital assets trading platform called NFTs.
- These tokenized assets are a byproduct of cryptocurrency. Initially started as a trading platform for digital art, the division has evolved to house multiple industries and a variety of participants, all within a short span of time.
- Their high stance and appeal in today’s world by the artists and creators in the space are because of the potential for content monetization they provide.
- With the blockchain being a decentralized platform, the potential for scams and theft is impossible.
- The online ledger stores the metadata of the assets in a plethora of systems spread over a very large net region.
- This assures security, exclusivity, rarity and potentially drives up the market value of the assets depending upon their utility and the attributes they possess.
- Every transaction/exchange of the assets is stored on the blockchain hence it makes it irrefutable to claim wrongful ownership of it otherwise.
- Peer-to-peer communication is also implemented in this platform, cutting out the middleman and intermediaries.
- The commission fee, scams during a money transfer, and third-party interference are eliminated because the blockchain presents as a decentralized space.
What Are NFTs?
NFTs stand for non-fungible tokens. The tokens are individually identifiable – unique and assigned to the assets that would be recorded on the blockchain. The metadata that is the record of the ownership of the asset is stored on the blockchain, and the asset itself is a digital existence on its own. Owning an NFT means having the right to call dibs on the asset rather than owning the physical manifestation of the object if it exists. The NFTs are usually digitally-native assets, but exceptions have been made for digital copies of tangible objects. However, the growth in the sector has now translated for NFTs to travel beyond its online application case. Digital assets trading can potentially pierce the trading of physical assets, with their established use case of possessing just the rights to the existence of the assets. These NFTs are sold, bought, and invested in the marketplace.
- The marketplace is the online retail platform for the NFTs to be traded upon.
- These marketplaces are various niches that suit different purposes of the marketplace available – depending upon the kind of projects.
- NFTs are notoriously known for their overlapping intersectionalities in the selection of industries they host.
- Sometimes their intersectionalities warrant a different kind of setup for a marketplace than the usual route.
- For example, a marketplace dedicated to the digital art of a celebrity can also make use of metaverse elements, gaming, and ticketing all in one.
- The beauty of NFT markets being any of these individual niches can stand their own, yet they can be easily integrated with other niches and sold.
Primary And Secondary Marketplaces
- The NFT market is of two main classifications – the primary and the secondary market. The former is used mainly by the creators, artists, businesses, and brands who have content to sell.
- They list them on their dedicated marketplaces or on public ones.
- The secondary market is composed of investors and individuals who trade and sell the NFT pieces that they bought on the relevant primary marketplaces.
Advantages And Disadvantages Of NFTs
- NFTs are highly opportunistic and revenue-generating in the active and passive sense.
- They can serve as short-term high-intense investments, or the long con investment depending upon the piece.
- NFTs are easily accessible, and anyone can pierce the market.
- Especially with the help of no-code launchpads like GuardianLink in existence – helping artists and creators to start their own marketplaces.
- The NFTs are not an asset class, meaning, although they are readily available, they are not easy to purchase by any average measure.
- Many factors play into the accessibility of ease in buying the NFT – starting with a cryptocurrency exchange, Ethereum’s ether should be purchased, and the wallets should be funded before buying.
- And just because they are asset classes, they don’t mean automatic revenue generation in secondary markets.
- The NFT project’s trajectory is partly luck and the superficial factors pertaining to the project’s exclusivity, rarity, and utility.
Concluding Thoughts On The Decentralized NFT Platform
The digital assets trading platform is set to take over the world, and moving on from the mere fad of being a talking point in interesting conversations, they hold high monetary gain opportunities if infiltrated in the right and decisive manner.