You might have heard your know-it-all friend talking about cryptocurrency and how the entire world will soon be investing in NFTs. Well, technically, they are not wrong. It seems like everything around us is moving towards a more digital future with the Metaverse and the digital wallets that will soon be a must-have.
Just like many others, you probably tried to understand what an NFT, or non-fungible token, is and failed miserably, so let us simplify the whole process for you. How did a tweet sell for 3 million dollars? Why did a GIF of Nyan cat sell for over 590,000 dollars? And why are people even spending so much money on these things when they can easily just take a screenshot of it? Well, picture this! You are at the Louvre, and you see the Mona Lisa, a fascinating work of art. You take a picture of it with your iPhone 13 pro max. Even though you now have a 12-megapixel image of the Mona Lisa on your phone, it doesn’t exactly mean that you own Leonardo da Vinci’s greatest work, does it? This is what a non-fungible token means. It’s that there is only one version that is actually valuable.
Today, art, music, real estate, and even tweets are being tokenised, but what gives each of these things its value? Why would a GIF be worth 590,000 dollars while others are only worth 1000 dollars? Since we started by using art as the main example, let’s look at what makes certain pieces of art more valuable than others. You might have guessed the answer to this one, and it is the fact that a bunch of people or the market agreed on its value. So, although all pieces of art are made of canvas and some paint, a work created by Picasso would be much more valuable and recognisable than that flower painting you made in 6th grade and had to convince your mom that it’s fridge-worthy work.
How will NFTs take over the world? You may ask. Remember when we were all kids and would ask our parents for money to buy games for our PS1? Today, kids ask their parents for “Minecoins”, an in-game currency they use to buy skins and other stuff from the Minecraft marketplace. The Metaverse that Mark Zuckerberg announced its launch earlier this year only deals with crypto and NFTs, which basically hints at a future where people mainly use digital money to watch concerts, movies, and listen to music.
Before you judge the people who are investing in NFTs, remember that at some point, people were making fun of TikTokers and YouTubers who are today making millions. So try to make sure that this time you don’t miss your chance of maybe getting into something much bigger than it seems today.