Of all the shocking moments that came out of the 2021 crypto boom, the biggest NFT sale of the year is the one that’s stayed etched in my memory. It was when Mike Winkelmann, a digital artist who creates surreal phantasmagoric 3D images under the name Beeple, sold a JPEG for $69 million at Christie’s. The auction rocked the art world and placed Beeple in the history books. It also kickstarted a period of mania in the digital assets space. The world watched on and collectively asked “what on earth are NFTs, anyway?”
Non-fungible tokens, unique blockchain-based tokens that prove ownership of an asset, had previously been embraced by a small community of crypto art pioneers, but interest in the technology exploded in 2021. By the summer, crypto enthusiasts were flocking to avatar-based NFT collections like Bored Ape Yacht Club to “wear” on their social media profiles. Internet-native communities started to blossom at hyperspeed.
“We’ve barely scratched the surface of what NFT technology could enable.”
NFTs have proven that they could unlock a world of creativity by helping artists earn from their work. Blockchain smart contracts also provide a way for NFT creators to earn royalties on secondary sales, which has changed many lives. NFT owners, meanwhile, can join communities, support artists or social causes, and signal their interests. Still, we’ve barely scratched the surface of what the technology could enable.
The NFT Boom
The NFT boom of 2021 proved a key token.com thesis: that there will be millions of tokens in the future. We already have thousands of fungible (i.e. interchangeable) tokens like Solana and Uniswap. But now that we can tokenize all kinds of unique assets, it’s clear that NFTs are just getting started. In the future, NFTs will take the form of in-game items, digital clothing, house deeds, event tickets, and more besides. In fact, this is already happening around the world today.
Here at token.com we’ve been exploring NFTs for some time now. While we initially supported fungible tokens like Bitcoin in curated Collections, we’ve taken a step in showing our enthusiasm for NFTs. Our “NFT Staples” Collection includes some of the most important projects in the space today. In the future, it won’t only be companies like ours that need to support NFTs; they will be everywhere.
It’s Still Early
Of course, as with anything in crypto, it’s important to temper expectations from time to time. While NFTs entered mainstream consciousness last year, they’ve proven extremely divisive. Many people have conflated NFTs with environmental concerns over cryptocurrency mining, and there has been resistance to the speculative nature of the market. The recent crypto slump has also affected even the most sought-after NFT collections.
“The NFT boom proved our thesis that there will be millions of tokens in the future.”
However, it’s definitely still early for the technology. While Bitcoin just hit adolescence, NFTs are in their toddler years. Given the exciting use cases that have emerged to date, it’s clear that the next 10 years will be a wild ride. We’re heading towards a tokenized world—just as Bitcoin and Ethereum will play a crucial role in what we’re building, NFTs are about to change everything too.
Mel Gelderman, CEO of token.com
Read more via CoinTelegraph here.
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