NFTs & BlockchainWhat your business needs to know about NFT + 3 business use cases for NFTs
The story of the incredible hype around NFT (non-fungible tokens), which we have been observing over the past year and a half, is a textbook example of how mass and social media work, as well as loud headlines about records for promoting anything. And a clear illustration of how in our capitalist world price has replaced the concept of value. Nevertheless, NFT has already been "legalized" by the main auction houses, big names of digital and non-digital artists, and it seems that we will not get away from it. At least, until they invent something new, more perfect. So let’s see what you and your business have to know about NFT.
Let’s start with what non-fungible tokens are (NFTs)?
Non-interchangeable tokens, or NFT, appeared for the first time back in the 2010s, but they became widely known only a couple of years ago when they began to be used to verify digital works of art (that is to use as a certificate of authenticity). They are not interchangeable because they contain unique information about the author of the work, the owners, as well as a link to the placement of the artwork confirmed with the help of this NFT (cloud storage, Internet address).
Now we can look and analyze TOP 3 business use cases for NFTs:
NFT and Real estate market
Real estate sales have undergone significant changes, and today they follow a new trend in digital commerce, namely NFT.
NFT, a non-interchangeable token (non-interchangeable token), is a special type of cryptographic token that represents something unique, the owner of which is sure that only one such token exists.
Currently, the NFT market is filled not only with works of art or video games, but now with real estate, so this new business system can completely revolutionize the bienes raíces market as its popularity and stability grow.
This is the case with the apartment owned by TechCrunch founder Michael Arrington, which was bought through NFT, making it the world's first blockchain-backed real estate.
Propy, a real estate platform that aims to revolutionize the way real estate is bought, was responsible for carrying out this revolutionary action.
According to the article, this process began in 2017, but only recently did Propy manage to complete the sale of NFT property for 36 ETH (Ethereum), which is equivalent to 93 thousand dollars.
Estudio type apartment Based in Kyiv, it started its sale for 20 XNUMX dollars. The importance of the process is as follows since the Ethereum-based NFT in which smart contracts are stored includes these lines of code that describe a set of rules that must be followed before money can be unlocked and transferred, and you don't need a third party to facilitate the transaction.
It is thanks to this security and speed that the Ethereum blockchain becomes very attractive for real estate transactions because instead of providing a deposit or a guarantee, buyers or sellers can simply respond to smart contracts based on cryptocurrency.
FT has become a very secure type of business, as both the seller and the buyer are aware of what will be purchased and how it will be done, since the property is certified, which facilitates digital transfers.
The sale is recorded in the Ethereum blockchain, minimizing paperwork and avoiding the transfer of ownership through a conventional document.
In this sense, we see that the NFT not only certifies the property and facilitates its sale, but also the paperwork. Similarly, the owner of the property in the NFT has everything necessary to dispose of his property on the physical plane, that is, do you want a loan, and do you place your property in the NFT as collateral? Of course, you can.
Currently, cryptocurrencies are already being used to secure a loan.
There are even platforms for "cryptocurrency loans" that provide to advertise the value of your cryptocurrency collateral without going through the grueling approval process.
And if you are wondering whether the sale of real estate in NFT is "small", there are other cases when houses or apartments secured with tokens are offered or sold.
In Germany, the house is sold as an NFT. The house is located in Kransberg and is offered at a minimum price of 34 ETH.
For the specialists at Bienes raíces, NFT transactions are an important milestone as they take advantage of blockchain technologies and non-interchangeable tokens to achieve an "autonomous" business.
Also recently it became known about the sale of a digital house, also on NFT, called Mars House, which belonged to the artist Krista Kim.
Art, luxury brands,
Five or six years ago, NFT in art was tried to be used head-on — to record information about the owners of works of art existing in physical space in the blockchain, and thereby make the art world transparent, because the names of the author and owners inscribed in the blockchain, on the one hand, cannot be deleted (only added), and on the other - they can be visible to anyone. In this regard, it was not without comical situations: since the idea of higher-level regulatory authorities contradicts the very essence of the blockchain, then, in the absence of a "verifier" of the information being entered, one clever artist attributed to himself the authorship of da Vinci's "Mona Lisa". It is clear that everyone is just laughing at him, but this, albeit invented, connection with the "Mona Lisa" will remain recorded in the blockchain forever.
What your business needs to know about NFT + 3 business use cases for NFTs The application of NFT not to physical, but to digital works of art turned out to be truly productive. Many digital artists who created digital images, gif animations, videos, computer games, virtual and augmented reality programs could not monetize their art, it was actually in the underground. Since some of their works were freely circulating on the Internet, most collectors did not consider them to be of any value. I downloaded it to my computer or my phone, and no one will ever know where the original is — that's what they thought. NFT made it possible not only to secure intellectual property rights for artists but also to indicate the current owner; allowed to produce limited edition works; and thanks to smart contracts, they also gave artists the right to a percentage in case of resale of the work. To transfer NFT, the seller and the buyer must have a digital wallet that accepts tokens issued based on a particular cryptocurrency (the most popular is Ethereum).
The main example of the grandiose success in the field of monetization of digital works of art with the help of NFT belongs to Mike Winkelmann, better known under the pseudonym Beeple. If five or seven years ago he sold his digital works for one dollar, then on March 11 this year he became one of the most expensive living artists whose works were sold at auction. Ahead of him — could we have thought about it a year ago? - just Jeff Koons and David Hockney. Winkelmann's masterpiece, Everyday: The First 5000 Days, which went to Christie's for $69.3 million, consists of five thousand works combined into one large-scale digital canvas, he created them for 13 years, since 2007. Interesting fact: 11 collectors participated in the auction, and 22 million people watched the final minutes of online bidding.
Sports, and athletic
At the end of April, the Ultimate Fighting Championship (UFC) promotion filed two patent applications to begin selling NFT. The first trademark is for launching a cryptocurrency under the UFC brand, the second is for creating an application for a new token, Decrypt writes.
This is an expected event since other popular sports in the United States have already begun to actively develop the topic of non-interchangeable tokens. For example, the first major application that combined big sport and NFT was NBA Top Shot. The creators of the platform from Dapper Labs have received an NBA license.
The NBA Top Shot database stores hundreds of thousands of moments of NBA basketball matches packed into sets of three categories, each with its starting price: regular sets cost $9, rare sets cost $22, and legendary sets cost $230. All cards are issued in limited series. Players can sell and buy cards, as well as exchange them to collect their collection of episodes featuring a favorite player or even a team.
In an inexpensive set of moments with one player, there may be an important episode that is valuable for another user — this is what the concept is based on. So, Zion Williamson's block shot in the match with the Denver Nuggets went to the NBA Top Shot for $ 250 thousand.
Also, many football clubs have released their NFTS. One of the most popular platforms where football-related NFTs are used is So rare. This is a game in which you can create your virtual football team using a base of 4 thousand football players. Players are "packed" into sets of cards with episodes of various matches.
During the game season, Sorare gives the fan a limited number of cards: 100 rare, 10 very rare, and 1 unique. Cards have two levels of value — collectible (sale, purchase, exchange) and in-game: you need to monitor the life of a "card" player in reality — whether he is healthy, whether he entered the field and scored a goal. This process differs from taking care of Tamagotchi by the possibility of profit: every time a player scores a goal in a real match, the owner of his Sorare card earns real money.
Now more than 130 major football clubs from all over the world cooperate with Sorare, including PSG, Bayern, Liverpool, Juventus, Real Madrid, Russian Zenit, Lokomotiv, CSKA, Spartak, Dynamo, and Krasnodar. According to the tracker's assessment Nonfungible.com Sorare is among the top 3 actively growing NFT projects, together with CryptoPunks and super rare, and the company's digital turnover is more than €10 million. The average monthly growth of the platform in Russia since the beginning of the year is 115%.
In addition to So rare, the world of NFT football unfolds on other virtual platforms that support the NFT protocol — for example, OpenSea, Raible, Sorarebuzz, Soraredata, Soraremega. The cards are traded even on eBay. Football NFT tokens are leading in trading volumes, but the most expensive sales so far are on the basketball and baseball side. In January 2021, baseball player Mickey Mantle's card was sold for $5.2 million.
According to a Variety magazine poll, 54% of fans aged 18 to 38 prefer to watch NBA highlights rather than the entire game. For the MLB baseball league, the same figure is 58%. NFT platforms offer a new generation of fans products adapted to their characteristics.
However, the sphere of cryptocurrencies is connected with the world of sports not only through NFT. The story with tokens of football clubs began back in 2018 when PSG announced plans to issue its coin. Clubs use the infrastructure of third-party IT platforms to issue tokens. The most popular of them is Socios, it is used by such titled clubs as Barcelona, Juventus, Roma, Atletico Madrid.
It is this platform and its founder Alexander Dreyfus that can be called the authors of the FTO — Fan Token Offering concept. Back in 2018, the platform released its cryptocurrency — Chiliz (CHZ) on the Ethereum blockchain, and in November 2019, Juventus Turin held its first FTO on the platform.
Since the fall of 2019, Chiliz has been trading on one of the largest crypto exchanges Binance in terms of trading volumes. In March of this year, the altcoin price increased by 700% in a week. In 2020, football clubs earned more than $ 30 million on Chiliz, and this year the planned income is $ 100 million, Alexander Dreyfus, the CEO of the project, said in an interview.
However, in addition to Socios, there are other platforms for the introduction of blockchain and tokenization of football clubs. Bayern Munich began to cooperate with Striking Entertainment and Real Madrid - with the blockchain startup Fantastic SWAP. Already more than 100 football teams around the world have their cryptocurrency. Among the clubs whose FTO takes place at Socios these days are the Polish Legia and the Turkish Geztepe.
Possession of fan tokens allows fans to participate in the life of the team: for example, a song playing after a goal was chosen for Juventus, a new motto for Milan, and an inscription on the captain's armband for PSG.
NFT technology allows you to digitize and make it easier to interact with any product. Ownership, purchase, sale, confirmation of originality. Tokenization adds value to the product. NFT is called the main trend in blockchain in 2021. This technology has already revolutionized art, games are next. And it looks like if there is a product that cannot be eaten it is highly likely to be tokenized.