Let’s say you jumped into the hype of NFTs and went on and spent thousands to claim one. You might be thinking, “I got myself a cool piece of art”. However, this is not all you got. A piece of art on the internet is a digital asset right. So what makes this digital asset an NFT? It simply should be uploaded on the blockchain. Therefore, if it’s not the art, what is the value of NFT?
The Real Value of NFTs
Owning a digital asset can be great. Let’s imagine you buy a digital painting from an artist you love. That’s cool. Now you want to set it as your profile picture or upload it on the internet. After uploading it, you see hundreds of people downloading it and using it. So, is it yours? You paid for it, it should be. But no one can know that you actually paid money to own the painting. That’s where NFTs come to save the day.
NFTs are a non-fungible token stored on the blockchain. For those who don’t know, the blockchain is a decentralized public ledger that keeps transactions records. Cryptocurrencies are stored and traded on the blockchain. However, NFTs differ from cryptocurrency by its non-fungible trait. Fungible is, for example, when 1 dollar equals to 1 dollar or in this case, 1 ETH to 1 ETH. NFTs are non-fungible meaning that in no case 1 NFT is equal to the other. That means each NFT is unique and is recorded on the blockchain.
So what does have an NFT do with the painting?
NFTs are usually link to different types of art, music or any digital asset. Let’s consider you want to buy a Bored Ape Yacht Club character. Each BAYC character is a non-fungible token stored on the blockchain. After making the purchase of a specific BAYC, you are a holder of an NFT. What you actually bought is not the image of the ape, rather the token its linked to it. Why is it important? Because it is a form of ownership. Now everyone will know that you spent money on the BAYC NFT and it shows in the public transactions record.
The Value of NFTs Beyond the Art
What makes an NFT valuable? The clear answer is ownership. However, are all NFT collections worth the same? Why are some NFT collections more successful than others? Let’s look at the BAYC collection, which is considered one of the most successful NFT collections on Opensea. People’s attraction to the art style of the collection of BAYC at launch is obvious. It is also one of the first NFT collections to drop amongst the early NFT hype. However, that’s not only why they are successful.
Buying a BAYC NFT is also buying its metadata. The Bored Apes are digital characters that can have many traits out of the 170 different characteristics, such as the ape’s appearance, expression, headgear, and more. However, BAYC has also managed to build a whole community that really belongs to the club. So, buying NFT Ape would grant you exclusive access to the BAYC Community. The online Yacht Club also offers exclusive perks to members who have a Bored Ape membership card.
Moreover, the fact that NFT owners enjoy complete commercialization rights to their Bored Apes is a more noteworthy advantage. You are welcome to use your Bored Ape to sell t-shirts, caps and other merch. Not to mention the members-only access to the club’s metaverse. These are only a sample of the benefits that you get, but members have already paid a high price for the ape. This is a proof that the higher the price is, the higher the value of the NFT you purchase will be.
The Future of NFTs
In its very early stages, people were hopping aboard the swiftly moving train, buying weird and surreal images. Today, it’s much more than that. They are buying everything related to that image along with its perks and return on investment. On another level, people are also starting to acquire these NFTs in order to enter a virtual world and, well, live there. So, can you just imagine where we’re going?
As much as the idea sounds scary, but let’s face it, the digital world is the future and there’s no running away from that. It’s slowly incorporating itself into our daily lives and it’s only a matter of time before you become obliged to belong to this world. Embrace it and learn about its core value as much as you can at its early stage; this is our advice to you.