I think by now everyone has heard of NFT’s.
NFTs (or “non-fungible tokens”) are a special kind of cryptoasset in which each token is unique — as opposed to “fungible” assets like Bitcoin and dollar bills, which are all worth exactly the same amount. Because every NFT is unique, they can be used to authenticate ownership of digital assets like artworks, recordings, and virtual real estate or pets. – Coinbase
Right now I think many people see this as a fad, and there are all kinds of tokens being created and sold for ridiculously high prices, which both make the news, and seem like a silly waste of money. But there is something here that is pretty special in two different ways. And when the dust settles and the fad-y-ness goes away, it is creatives who will benefit from these tokens.
1. Re-sale of art.
When an artist sells an original, they get the sale price and then they don’t benefit if the art is resold. Often an artist will take years to get popular (much less famous) and their early work is essentially given away compared to their later work when they become known. With NFT’s, artists can get a percentage of the resale value. The token can be tracked and if sold on an NFT market (rather than a private transaction) then the artist can keep a commission.
2. Tokens tied to real world rewards.
There is a DJ named 3LAU (Justin David Blau) who sold NFT’s of his work in an auction,
“The way 3LAU structured his auction was very cutting edge and the mechanics of the auction should be noted. There were 33 available winning slots in total for the auction. Slot #1 was the Platinum Tier, slots #2 – 6 was for the Gold Tier, and slots #7 – 33 was the Silver Tier. Each tier contained digital artwork, music, and physical goods (Vinyl) connected with the project. The winner of the Platinum Tier also won a custom song created by 3LAU with the winner’s creative direction, tokenized as a 1 of 1 NFT.” ~ Dennis Martin
In another auction, the top tier included lifetime tickets to every concert he does. And since this is an NFT that can trade hands, it can be sold if the buyer no longer wants this.
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So while you’ll read things like, A Rare CryptoPunk Ape NFT Was Sold for $10 Million USD in Ethereum, and wonder why? Or how this can be sustained? Or if this is just a fad? NFT’s will have value desired by others. Yes, there will be silly collectables selling for way too much. But there will also be the ability to play games and earn items of value that can be traded rather than just hoarded. And that is another way NFT’s will be used to trade items people will want to pay for.
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Collectables and video games aside, NFT’s will be a game changer for artists and creatives. And in a world where automation is making items better, cheaper, and faster; and where jobs themselves are becoming more automated, there will be more time and space for artists to hone their crafts as a way of making a living. NFT’s will be part of that future where artists can sell their work, provide experiences for their fans, and benefit from the resale of their work as their popularity grows.
NFT’s might seem like a fad to you, but they are here to stay, and some time in the near future you’ll end up owning one if you attend a live show, or buy a piece of art, or maybe even choose to pay for a song of artist you love to listen to.
