July 01, 2022 • 146 Views
NFT and Cryptocurrency, as well as other digital assets, have only recently begun to rapidly gain popularity. Nowadays, it is hard to impress anyone with a simple mention of any of such terms. Nevertheless, the debate on the feasibility of investing in this area has not subsided so far. Some analytics believe it is nothing more than just a bubble, that will burst soon. Others, on the contrary, say that it is an innovative industry that will continue to develop. So is it already possible to determine the winner in this dispute and to tell if there is a role for digital items in the future and which one if so?
First things first, we have to understand what exactly are we talking about. Non-fungible tokens are digital assets, created with the use of blockchain technology and they are usually based on various crypto tokens.
Actually, NFT tokens are usually used to identify the exclusive rights of the author and the ownership. Thanks to the blockchain, it is possible to create and track the chain of transactions and ownership history. As a result, it is easier to prove or deny the origins of the virtual piece of art or other digital collectibles.
In fact, Non-fungible tokens have become a great tool, that can be used for a few purposes at the time. As well as crypto exchange and trading platforms, the NFT marketplace has become a game-changer in the field of investments. For instance, some of the NFT items can cost thousands of dollars. At the same time, the overall NFT industry operates millions of dollars every month. However, these items must be considered not only as a virtual analog of baseball cards, popular among experienced investors that will later use NFT items as speculative assets to increase their income and own wealth.
In reality, the NFT marketplace is also a great way how to popularize the art and support the creators. Most marketplaces work in auction format when the highest bid wins. Moreover, NFT tokens are "attached" to various media, no matter if it is a picture, video, sound, or even a game item. The token is proof, that the item, it is connected to, is unique. Also, it can be attached only to virtual objects, meaning that there are literally no limitations to the imagination. Include also the fact, that this technology appeared recently and can make its creator a millionaire, and you will get the best example of the competition among creators.
Obviously, in such conditions neither investors nor artists are interested in usual and boring ideas. Conversely, the crazier and more experimental the idea is - the more attention it will receive.
As was already mentioned, non-fungible tokens are digital assets, based on blockchain. However, we haven't explained how exactly it works.
In simple words, NFT is "minted" thanks to hashing. Hash is a unique string that consists of letters, numbers, and symbols. In fact, NFT is a link to this string, not the image. So, while a person sees an image of a Nyan Cat, the computer sees the algorithm and unique set of symbols, or in other words, hash. The main difference between NFT and crypto tokens is that the second ones are fungible, meaning that they are not totally unique.
The "attached" NFT is based on the blockchain of the minted coin. Of course, you can use almost any cryptocurrency for minting. However, the Ethereum-based tokens are the most popular and common on the market. Most platforms have their own specifics, including the supported blockchains. Nonetheless, Ethereum is supported by almost every NFT marketplace.
For more successful NFT apps investment and development, it is essential to understand not only the basics of the industry but to know the specifics of the applications, their functionality, and features, usage purposes, etc.
For instance, there are at least 2 crucial options, that must be embodied in any such application: the possibility to create an NFT and the NFT marketplace feature. As a matter of fact, from platform to platform, almost all of them are operating as marketplaces for digital items. Lots of them position themselves as an alternative art market, that has all the rights to existing at the level of various art auction houses like Christie's.
They also propose more convenient and favorable conditions for cooperation with artists. For instance, it is easier and more convenient for the creators to sell digital creations due to logistics issues. But the biggest advantage of the NFT auction format is the fact that the creator gets a percent of every further transfer on the secondary market. As a result, no matter how much will every next price will be - the artist will get a fee for the creation of the object.
On other hand, the buyers are also interested in participating in such auctions due to their transparency and no visiting limitations: there are no event tickets or invitations needed, and all the auctions are open for everyone.
So what are the features, that make it possible to develop a "virtual heaven for artists"?
Obviously, the first and the most crucial condition is to make it possible for the creators to mint the NFTs. Of course, it is impossible to integrate a full-fledged application for creation like Photoshop. It will need too many system requirements for such an unnecessary function. Clearly, there is no need to make it possible to create the media, that will be later converted into NFT.
On the contrary, the variety of services, that can perform the conversation, is limited. Most of them are integrated into other NFT apps. Moreover, they are regularly "attached" not only to the cryptocurrency blockchain like Ethereum but to the marketplace itself.
This is why it is very important to make give the NFT creation tools to the artists, so they can make their digital assets for further publication and spreading.
The second essential function you have to develop is the marketplace option. Clearly, the creation of the NFT is not the only requirement, there will be no use for it if there are no platforms for interaction with it. In fact, there is a number of various platforms, each of which has its own features and specifics. The only common thing, that is present on each platform - is the interaction. It means, that each such marketplace allows not only to publish digital art pieces but to observe them, buy or sell these assets, etc.
In fact, even virtual art galleries, based on the NFT approach, allow such interactivities. Actually, despite the fact, that most of such features are very common and work according to the same principles, there still are a lot of various small differences, that result in an overall distinction between these platforms.
For instance, some of the platforms require to pay for the creation of NFT but avoid additional transaction fees, some, on the contrary, allow creating an unlimited number of NFTs for free but charge a sales fee, etc. There is no standard, so the developers are free to experiment.
Also, these platforms can be sorted by the media they are dealing with. However, such distribution is not the main one due to the fact, that most popular marketplaces have already adopted the all-in-one model, so visitors can find everything they are looking for in one place.
Finally, it is time to talk about the NFT apps investment and if they are worth it. If you are looking for a short answer to this question - Yes, they are. The explanation is also simple.
Summing up all the above, we can state that NFT is indeed a recent industry, that keeps forming. Even despite the fact, that there are already huge marketplaces, that partly cover the overall market, it is hard to predict how the industry can be turned on its head. Though we can assume that it definitely can, and most likely will. Clearly, the modern situation in the market is uncertain: at the moment, despite all the statements about the good for the artists and the possibilities to use this tech in the art world, the NFTs are mostly used as trading cards. It means, that most market players consider them as a source of passive income.
But right now we can observe the tendency, when NFTs are going to be used in other spheres, like Video Games. For instance, a list of a few trend-setting and giant companies claimed, that they are going to integrate this technology into their future games. As a result, players will be able to find, buy or sell the in-game items with implemented NFT tokens.
Also, there are some examples of successful integration of similar technologies into virtual worlds - metaverses. For example, Decentraland is a fully virtual space, which "simulates" real life, with the use of cryptocurrency and NFT. Developers gave their users various instruments and allowed them to create whatever they want. Most objects can be bought or sold with crypto tokens. In fact, all of the objects in Decentraland (including the Land) are unique and have their own NFT. Including also the fact, that recently Facebook transformed into Meta and claimed to develop its own metaverse, it is not hard to predict that they will use this technology as well.
If you are looking for an experienced development team, that is ready to accept the challenge and take part in the development of an application of your dream - you have found one. We are ready to develop it from scratch or help to update the already existing one.
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