A new wave of digital technology is taking the world by storm in the form of “nonfungible tokens”, more commonly known as NFTs.
These digital tokens are assets verified using blockchain technology, whereby a seller can guarantee a buyer proof of authenticity or ownership of a particular asset. Artists, musicians, influencers and the like are now using NFT to buy and sell images, videos, GIFs, digital art or songs that contain a “digital signature” from the original artist.
Although these digital reproductions can cost thousands of dollars, they don’t guarantee you exclusive rights to the original image. If a buyer so chooses, they can include the copyright along with the image, but many of these assets work as a verifiable ownership of an original artist’s work.
Why would I purchase something I don’t own the full rights to, you may ask?
Well, you can print out a picture of a famous painting, or download it as a wallpaper, but there’s nothing that ties your version to the original work of art. In this way, NFTs work as a certification of sorts. A buyer is able to say “Hey, I have art signed and approved by the digital artist, I own rights to this particular asset, and here’s my proof.”
The popularization of NFT technology came in 2017 via a website called CryptoKitties. With this site, users could purchase and create limited edition digital cats with cryptocurrency. From there, people have moved to using digital currency to buy and trade NFTs in the online art realm.
If you you don’t understand how NFTs can hold such value to people, we’ll take a trip to the past to see why some find this art profitable.
If you hung out on the internet circa 2011, you may remember a popular internet GIF of a flying rainbow Pop-Tart cat. The “Nyan Cat” as this GIF was called circulated around the internet in the early 2010’s. A specialized NFT version, updated by the original creator, recently sold for nearly $600,000 at auction.
Another high-profile digital asset up for sale is from Twitter CEO Jack Dorsey. He’s selling exclusive rights to his first tweet, with the highest bid so far at a whopping $2.5 million. Although he’s planning to convert the money to bitcoin and give the proceeds to charity, the idea that a buyer finds value in a purely technological asset is something to behold.
Whether you find this trading of digital art interesting or silly, there’s merit to utilizing this type of technology as a way to certify goods and assets. Through digital certification of this nature, you can trace and verify ownership of a number of things, not just art. It’ll be interesting to see how this process is demonstrated and fulfilled in the future.
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