The ability of non interchangeability at the face value imparts a unique character to each and every NFTs created on top of the blockchain to power-up diverse sectors.
As a cryptographic asset which is recorded on top of the blockchain through a unique identification code and meta-data, NFTs have made distinction of assets possible in the crypto space. Since these NFTs are non-fungible, they have the potential to support diverse use-cases where they can truly bring sectors like real-estate, artwork, digital artwork, sports card, domain names and events tickets to the virtual world.The ability of non interchangeability at the face value imparts a unique character to each and every NFTs created on top of the blockchain to power-up diverse sectors.
NFTs which are based on ERC standards like 721, 1155 use cryptography for its seamless operations. By the use of digital platforms to mint unique representations of an asset class, maybe a real-estate, artwork, music or painting, NFTs make them accessible to the audience in a fractionalized manner. Hence, they effortlessly remove intermediaries in the process and represent true identity to establish the right of ownership for the NFT holder. That said, they have dynamically eliminated drawbacks in asset possession and ownership establishment sans complexities.
NFTs have established a new paradigm in trading where a group of assets can be combined and traded in a truly unique way. For example, in a traditional financial set-up, a land cannot be fractionated and offered for sale. However, through NFTs, that can be done in a truly efficient manner. On top of this, NFTs have also made artworks and properties accessible to a larger audience because you can easily own an artwork which is stored in NYC Art Gallery in the US by staying in Japan. There’s no challenge of transferring the artwork to diverse places, rather, you can mint an NFT and very much own a portion of that painting and artwork. Hence the dependency on intermediary gets eliminated and business processes can be smoothed which would otherwise have been made complex in a traditional setup.
NFTs got the media attention through BAYC, NBA Top Shots and Crypto Punks where the market skyrocketed from millions in 2017 to a staggering $15.7 billion in 2022 and it is expected that it will reach $122.43 billion by 2028. Hence, it wouldn’t be an understatement to say that the NFT market has gone past the stage of possession and establishing social status. Rather, blockchains maturity from a TPS and scalability perspective has allowed NFTs to get wider application in the metaverse. In the metaverse, new use-cases and ideas are built on top of NFTs. For example, on the decentral and metaverse, you can own lands, prepare them as digital assets and use them to get proceeds from its sale using NFTs to establish its ownership. Likewise, collectors can also showcase their arts in the art galleries which are based in the metaverse and they can reach out to a wider audience.
However, despite such pristine use-cases, the booming NFT economy hasn’t been spared from speculations. In the last bear market and even in 2022, they have been subjected to numerous pumps and dumps. The artificial buying and selling pressure created by groups and institutions who are engaged in pumps and dumps have significantly impacted the NFT market, causing it to decline further.
However, in 2022, there’s some revival nonetheless. Especially in the month of May 2022, the NFT market generated a steady $3.7 billion in sales despite the bear market. But these signals shouldn’t be treated as a market revival or start of the bull run, rather, we must be poised for a NFT winter moving forward. But NFTs will give true empowerment to artists and creators which will not be challenged for sure as we deep dive into the Web 3.0 space when the next bull run starts.
NFTs are already building communities, empowering the gaming sector and laying the foundation of ownership and identity in the Metaverse Solutions which makes them the next gen technology of the future to build a comprehensive Web 3.0 space. In this Web 3.0 space, NFTs will power up diverse use-cases and build a truly decentralized future.
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