We have seen a huge buzz for Non-Fungible Tokens (NFTs) in the market now. It has influenced many industries like artwork, fashion, finance, films, gaming, music, software, and sports.
The impact of NFTs has been enormous as it has crossed $30.94 billion in market capitalization and has an active trading volume of $3.02 billion according to data provided by CoinMarketCap.com.
What is a Non-Fungible Token (NFT)?
It is a unique kind of crypto collectible developed on blockchain networks like Binance Smart Chain (BSC), Cardano, EOS, Ethereum, Flow, Polkadot, and TRON.
These digital collectibles are sold on various online marketplaces like Axie Infinity, Decentraland, Foundation, GhostMarket, Gods Unchained, NBA Top Shot, OpenSea, Rarible, Sorare, and SuperRare through well-organized auctions.
NFTs can be purchased by prospective investors in the form of artwork, gaming assets, live documentaries, memes, metaverses, music (both individual songs and albums), photos, tweets, and videos.
Entrepreneurs can never ignore the profitable business of trading in crypto collectibles as there are 676,625 unique NFTs in the market according to Coinranking.com. The primary sales of NFTs are 23963 followed by 9905 secondary sales as per data provided by NonFungible.com. The top-selling digital collectibles in the industry currently are CryptoPunks and Meebits. The leading NFT selling online platforms are CryptoKitties, Gods Unchained, Sorare, Decentraland, and Ethereum Name Service (ENS).
Key characteristics of Crypto collectibles
NFTs are indivisible and non-interchangeable. They can be easily resold by buyers in different online marketplaces. NFTs have to comply with the ERC-721 and ERC-1155 token standards of the Ethereum blockchain network.
Crypto collectibles derive their value from a powerful combination of high demand from investors and scarcity (low supply). The holders of NFTs can verify the ownership of the digital assets anytime on the public distributed ledger through different blockchain networks.
NFTs are made highly secure by robust smart contracts consisting of detailed terms and conditions for ownership and transfer of crypto tokens. Crypto collectibles can represent either a single asset or multiple assets.
Most popular examples of NFTs in the crypto industry
DigiByte (DGB)
The DGB crypto coin was created on DigiByte, an open-source blockchain network. It is fully decentralized and highly secure. The price of DGB is very affordable ($0.15). The market cap of DigiByte NFT has surpassed $2.10 billion with a daily trading volume of $154.34 million.
BakeryToken (BAKE)
NFTs have seamlessly integrated with the profitable world of Decentralized Finance (DeFi). The BAKE crypto collectible is a BEP-20 token issued on the Binance Smart Chain (BSC) blockchain network. The BAKE crypto collectible can be stored by the investors securely in digital wallets like MetaMask and WalletConnect.
Investors have executed a whopping 288,996 peer-to-peer (P2P) transactions for purchasing the BakeryToken NFT owned by the BakerySwap platform. The BAKE NFT crossed $1.18 billion in market capitalization recently.
Origin Protocol (OGN)
Priced at just $1.71, the OGN NFT is fastly growing in the industry with a huge market cap of $485.30million. The Origin Protocol acts as a decentralized e-commerce platform to sell the valuable works of artists. It also sells crypto collectibles launched by leading celebrities. The Origin marketplace can also be accessed by interested buyers through the Samsung Blockchain Keystore.
Many NFT marketplaces have also come out with their own digital collectibles. Some highly-demanded crypto collectibles are Axie Infinity (AXS), Decentraland (MANA), Rarible (RARI), Terra Virtua Kolect (TVK), and The Sandbox (SAND).
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Connect on WhatsApp Let us know more about the history of the phenomenon of NFTs
While the market for crypto collectibles has exploded big time now. Its history can be traced back to June 2012 with the launch of Coloured Coins. They were sold as small units of Bitcoin (BTC) and the buyers used them to purchase coupons, subscriptions, and virtual property.
This was followed by the development of Counterparty, a P2P financial platform on the Bitcoin blockchain network in 2014. It offered the sale of the XCP crypto token to investors in the form of memes and trading cards. Genesis Gaming attracted millions of players through its BitCrystals NFT in April 2015. It was used as an in-game currency in various contests and tournaments.
The demand for meme-based NFTs increased rapidly with the emergence of Peperium on the Ethereum blockchain network and backed up by the InterPlanetary File System (IPFS). It sold memes and trading cards through a decentralized marketplace. Their NFT was utilized for both the creation of memes and paying the listing fees.
The whole world is talking about the resounding success of CryptoPunks but it arrived in the cryptocurrency market way back in June 2017. This was immediately followed by the launch of CryptoKitties for digital cat breeding in October 2017.
Now, we have many promising NFT projects like OpenSea, Rarible, Sorare, and SuperRare. New NFT marketplaces such as Binance, eBay, Elixir, Genies, Momint, and TrillerNet will also become big players in the future leading to healthy competition and a stronger ecosystem.
Why are NFTs getting so popular?
- It has changed the revenue-sharing agreement between platforms and creators by permanently removing the middlemen from the system. Now, artists, game developers, meme creators, musicians, photographers, and singers are getting a high value for their one-of-a-kind work.
- NFTs have also entered the lucrative world of digital horse racing recently. The players can participate by purchasing NFTs costing around $2 to $15 on a game known as Zed Run developed on the Ethereum blockchain network.
- The strong relationship between NFTs and gaming continues to grow as Sega Sammy, a Japanese gaming conglomerate, announced the launch of their own Crypto collectibles in the coming months.
- Do you want to purchase a house on the moon? NFTs make that easily possible. Investors can purchase the crypto collectible representing a digital house on the OpenSea marketplace. It was created by Roman Kropachek, a millionaire entrepreneur.
Analyzing how NFTs function?
It gives ownership of a digital asset to the buyers. Content creators have to upload their valuable work in file formats like (JPEG, Mp3, and Mp4) on the NFT marketplace. The online platform takes care of the minting of NFTs. The content developers have to incur different expenses like auction listing charges, gas fees, initial registration charges, transaction processing fees, and commission on each primary and secondary sale.
The NFTs can be obtained only by the buyers who make the first bids through auctions held on the online selling platforms. The investors can securely back up their crypto collectibles in the leading digital wallets like Coinbase wallet, MetaMask, MyEtherWallet, Fortmatic, Portis, Torus, Trust wallet, and WalletConnect.
NFTs are authenticated by verifying the public key of the content creator and the private key of the prospective buyer.
What are the plethora of benefits offered by NFTs?
Crypto collectibles provide investors greater returns than traditional financial assets, a high level of authenticity, irrefutable proof of ownership, and also eliminates intermediaries/third parties during the execution of trades and the processing of P2P transactions.
The entrepreneurs get various sources of revenue by listing NFTs on sale. It includes auction fees, bidding charges, fees from the private sale of digital collectibles, minting charges, and transaction execution fees.
The content creators benefit from NFTs by getting fair compensation for their work through both primary and secondary sales along with royalty for every resale on marketplaces.
Why are some NFTs worth several millions of dollars?
The crypto industry has witnessed many valuable digital collectibles selling for millions of dollars due to heavy demand from institutional and retail investors. More brands and multinational companies are also planning to launch their own NFTs soon. This will lift the credibility of crypto collectibles to an all-time high.
The prices and trading volume of NFTs are increasing quickly due to aggressive bidding wars by interested buyers on different NFT marketplaces. There is a booming market for tokenized physical and virtual assets now.
What are the future expectations from NFTs?
The future of NFTs will depend on factors like cross-bridging with different blockchain networks, favourable cryptocurrency regulations imposed by the authorities and governments across the world, integration with the DeFi ecosystem, and real-life use-cases in various industries.
It will continue to maintain strong momentum by attracting more investors, getting more market capitalization and trading volume, and also supporting the efforts of millions of artists and content creators. Additionally, we will see the emergence of NFTs in different forms like certificates, degrees, patents, and trademarks in the years to come.
Upshot
The global NFT market will continue to break more records in future with greater craze from investors. With venture capitalists also believing in the huge potential of crypto-collectibles, this is the right time for ambitious entrepreneurs by collaborating with AppDupe for eye-catching NFT Token development.
We are always updated with the changing trends in the world of cryptos and NFTs. We provide state-of-the-art white-label clone NFT marketplace solutions, growth-oriented NFT marketing services, and also easily create crypto-collectibles based on the different token standards of the Ethereum blockchain network. Contact us now and witness unlimited growth in your NFT marketplace soon.
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Frequently Asked Questions (FAQ):
How is trading in NFTs secure?
NFT marketplaces implement multi-layer security measures like anti-DDoS protection, email authentication, end-to-end encryption, jail login, multi-factor authentication, and SMS authentication. This ensures that the data and funds of both content creators and investors are safeguarded always.
Transparency is ensured as Know Your Customer (KYC) and Anti-Money Laundering (AML) verification is conducted on all the buyers and sellers to facilitate a safe trading experience without any risks.
What is the meaning of governance tokens offered on some NFT marketplaces like Rarible?
The governance tokens are embedded with decision-making powers and voting rights for the holders. They can participate in influencing the future development and growth of the NFT selling platform and offer suggestions for new features by making crypto-friendly proposals. Governance tokens can be purchased by investors from the leading Cryptocurrency exchanges, DeFi platforms, and NFT marketplaces.
Will a buyer get alerts when there is a new launch of a new NFT in the market?
Yes, the investors will receive personalized and real-time alerts email alerts regarding new auctions, NFT airdrops, and trending collections sold by the top sellers in the crypto industry.
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