When I first heard of NFTs I was skeptical. Why would anyone pay tons of money for a video clip that you can watch over and over again on YouTube? Or a tweet that someone typed? Don't even get me started about cartoon cats. I said to myself this is a bubble and it's just a license to print money. To a certain extent I think that is true, but the more I think about it, the more it makes sense.
Since the beginning of time, humans have been into collectibles. Whether it's stamps, coins, rocks, watches, cars, sports memorabilia, antiques, artwork... people are willing to pay good money to have the privilege of owning something exclusive or rare. How much they would pay for them depends on the rarity, background story, sentimental value, difficulty to obtain, condition, and of course how much money they have. You may question why someone would pay $69 million for an NFT called "The Verge", but at the same time I question why someone bought Picasso's Les Femmes D'Alger for $179 million. Truth is, the value is in the eye of the beholder and we are not to question why, but just lament the fact that we are not rich enough to bid for them.
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| "The Verge" sold for $69 million |
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| Pablo Picasso's Les Femmes D'Alger sold for $179 million |
Well, so much for a skeptic, I spent about 1 ETH to buy an NFT myself. It is a digital horse and yes, you can race it, bet on it, breed it, trade/sell it. So far it has won 3 races, finished 2nd twice and 3rd seven times. You can check it out HERE, and yes it is for sale for the right price. A friend of mine bought a super rare horse and sold it for 30 ETH recently (Roughly $63k at the time).
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| My horse (Click for more details) |
But why do NFTs make sense?
1. Everything is digital
So many aspects of our lives are now digital. From our calendars to banking, we have become a digital age, so why not collectibles as well?
2. Safe from Forgeries
Because of it's value, people have been forging artworks, coins, banknotes, deeds, wills, but "non-fungible" means it is unique, cannot be replaced, and the blockchain proves its existence, ownership and authenticity.
3. Safe from Theft
Depending on how you store them, crypto can still be hacked and stolen and that includes NFTs. However because it is a unique token unlike a Bitcoin, it would stick out like a sore thumb. The blockchain will show who it was stolen from and who holds it now.
4. Safe from Deterioration
Mold, rust, rips, oxidation, most collectibles are super fragile and over time they deteriorate. Unless you decide to throw away the key, or a doomsday scenario where we lose all power and internet access otherwise your NFT will be here forever.
5. Ease of display
What's the point of owning something cool without being able to show it off? Someone somewhere probably has cool collections but without knowing the person and physically visiting them, I would never be able to see it. With NFTs you can share it, invite people to your own virtual galleries, I assume frame them on a digital frame as well.
Yes there is a lot of hype with NFTs at the moment, and I do think some of the prices are way inflated, but once the dust settles, and people grow into the idea of NFTs, I really think they are here to stay.
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