The trends of blockchain technology enabled NFTs and their use-cases.
The cryptocurrency community is facing immense growth since a decade ago. Trends in NFTs, decentralized finance, and dApp are transforming how people invest and use virtual assets.
What is NFTs - Non-fungible Token?
It is a unique digital certificate that represents ownership of a creative or virtual piece of work. NFTs are an added bonus to artists, musicians, luxury asset creators, and exclusive ticket sales. Prospects usually purchase NFTs through decentralized marketplaces, which embed the purchases through smart contracts and resale their value on agreeable terms. The content of an NFT can be sold or repurposed through digitally signed copies and their value is often defined by their scarcity. A most scarce asset is usually the highest in terms of value.
Use-Cases of NFTs
Non-fungible tokens are aiming to disrupt tens of industries through protecting ownership rights, preventing fraud, enhancing traceability in item logistics, increasing demand oversupply, and creating content rewards across games and creator platforms. The amount of industries the technology is meant to disrupt areas from music, fashion, gaming, art, film, automobile, real estate, and more.
NFTs Digital Collectibles
A digital collectible is an irreplaceable digital asset you can buy or trade just like any other property; they are not tangible and could be an encrypted jpeg that only you can own. Crypto Kitties is the leading global platform for trading NFT collectibles.
NFT trades involving artwork and collectibles are intertwined and aim to allow someone to own or digital store a rare digital asset. It is impossible to corrupt, steal or interfere with the value, ownership, and storage of a collectible. The industry is a great way for creatives and artists to earn and trade their artwork on the many available NFT marketplaces.
NFTs in Gaming
Gaming is probably the most prominent application of non-fungible tokens. Mostly, NFTs could represent in-game assets and rewards. Benefits of implementing NFTs in gaming include facilitating ownership, interoperability, provable scarcity, and immutability of the blockchain. In-game assets are rare, unique, and indivisible and are deployed through a decentralized network. The most popular Dapp ecosystem for NFT-driven games is the Ethereum blockchain.
The ethereum blockchain comprises lots of assets and digital coins that can be incorporated across any type of game to reward players and incentivize developers.
Non-fungible tokens can be used to protect ownership of creative assets in the music industry. Thereby solving some of the most overarching problems in music regarding stolen ideas or duplicated content. NFTs can store and protect the ownership of an asset regardless of its nature, whether tangible or virtual. The asset could be video, audio, or photography work. Therefore stakeholders in the music industry can utilize them in preserving copyrights, royalties, and content ownership. Some benefits of NFTs in music including eliminating third-party managers and earning returns in the reproduction of their content.
For example, musicians could have their music streamed through platforms such as Amazon Music, Spotify, iTunes, or Spotify. However, these platforms do not pay musicians their full dues. NFT platforms such as Rocki and the Binance Smart Chain are allowing musicians to stream their content and earn rightful royalties.
Real-world assets are usually vulnerable to scams and fraudulent claims, especially when ownership documentations are deployed through traditional files. NFTs can tokenize these documents and digitally encrypt them in a way that protects the due rights. Such documents include death certificates, wills, property certificates, licenses, and qualification documents. Tokenizing physical assets ensures property cannot be liquefied, and one can access the ownership history as a piece of asset is transferred from one person to another. Tokenized properties are sold through digital auctions and awarded to whoever wins the auction.
A luxury item or jewelry can be represented as a non-fungible token and traded online. This means anyone can trade or own an asset digitally as long as it has been tokenized on a decentralized ledger.
Immutability and decentralized features of the blockchain allow for transparent tracking of transactions taking place on the network. Remember, a blockchain transaction is irreversible; therefore, tracking the origin, location, and circulation of an item becomes easier in product logistics. Items can be tokenized into NFTs, and their shipment can be tracked down around the globe. Blockchain timestamps also come in handy in logistics and make it easier to follow goods and act fast in case of loss or damage.
DeFi or Decentralized Finance takes full advantage of NFTs by leveraging staking mechanisms across decentralized projects. For example, a non-fungible token could be offered as a reward on a staking pool. Users, on the other hand, receive staking power in varying degrees depending on the size of their NFT stake. Decentralized finance stakes could be collected through a global secondary market.
NFT Digital Art
Non-fungible tokens can be used to solve counterfeit issues in the art sector. Encrypting digital ownership of creative works enhances product uniqueness, scarcity and prevents forgery. NFTs are already transforming how art auctions take place and offering artists alternative revenue generation methods.
Theft across fashion design can be solved through the proliferation of valuable, high-end designs as NFTs. This would make it significantly difficult for counterfeits to enter the market and enable designers to digitally authentic their designs.