Right now, NFTs are at the peak of hype: Bored Ape #8585 just sold for $2.7 million, the NFT NYC conference was attended by Quentin Tarantino and Busta Rhymes, and huge NFT-related billboards were hung at Times Square.
But many people doubt that NFTs are nothing more than just a speculative asset with no real value, lacking any tangible use cases. Is that true? And what do the crypto space and blockchain technology have to offer in the near future other than NFTs?
According to those who have heard about NFTs once or twice in their life, it’s just a funny meme or video backed by the hash and stored on blockchain. The hash is completely unique and one of a kind, which is why it is called a non-fungible token. It’s considered a certificate of authenticity of the asset you own, and the proof of your ownership is publicly available because it is stored on blockchain and it is decentralized. Basically, no one can steal it.
In addition, NFTs have given graphic artists and content creators the chance to express themselves and earn money without getting involved with top galleries, auction houses, or other middlemen, which is pretty hard to do. However, this isn’t the only use case for NFTs.
For example, NFTs can be implemented in the copyright and intellectual property industry. With an NFT, there will be no argument of the provenance. At recent NYC NFT events, I met with some industry leaders to learn more about the active NFT boom.
“We work with an intellectual property management platform,” says Ashok Ranadive, Director of Professional Services at CasperLabs. “We have written the history of ownership on blockchain, so there are no questions. Also we are helping to extend the use cases. The technology where multiple patent owners pool-in their patents together. For example, there is 5G technology and multiple companies have a patent for different parts of this technology.'
When there is such an advanced technology, all the patent owners can pool-in their patents, and that pool of patents can be licensed and royalties can be distributed to the pool of stakeholders. This is a very complex use case where NFTs and blockchain technology could be used. NFT space is a new market which is developing now and the enterprises have huge potential using these technologies. Existing operations and supply chains could use this technology. Nowadays NFTs can be even used as a proof of authenticity of the vaccination card for example and you can easily track vaccinated people.”
Another huge advantage of NFTs is total transparency, since everything is stored on the blockchain that is accessible to anyone.
“Our protocol allows any user to check who owns which NFT, get the whole metadata, search by NFTs and we try to make it open source and available for the whole market,” says CEO of Rarible Alexei Falin. “This open source protocol supports Tezos and Flow blockchain, soon more blockchains will be supported, like Matic (Polygon), Solana, etc.”
The founder of one of the biggest NFT marketplaces sees NFTs not only as a tool for art collectibles rights and copyright issues.
“I am sure that NFT has a big potential in the gaming industry," says Alexei Falin. "For example, metaverse where you can collect and play with NFTs, play-to-earn where you can increase the value of your NFT during the game or yield-farm new NFTs. And those opportunities to earn money attract more and more people to the industry.”
However, according to Alexei, the industry has issues such as not having user-friendly interfaces for newcomers, no super-secure custodial wallets, complicated KYC procedures, and fiat-to-crypto purchases taking ages to complete.
“I think if someone who has a huge base of people with verified identities like Coinbase would make payment options for NFT marketplaces that would be a new step for the whole industry,” Alexei continues.
Payment is a huge concern affecting the entire crypto space.
“RippleNet was a part of the company in 2013 as a new payment solution for enterprises,” says David Schwartz, CTO of Ripple. “Existing enterprise payment system couldn’t settle for cryptocurrency payments. Now we have RippleX to allow people to build solutions on the XRP Ledger blockchain, in particular things like NFTs and DeFi. Payments in blockchain should be as easy as sending the email. I do not want to write 17 rows of code to make a payment, so we want to make an open source solution to enable the whole NFT and crypto ecosystem to make the user experience as easy as ever.”
Ripple itself is looking to be the leaders of the NFT space; they recently invested in Mintable, an NFT marketplace that allows users to create, buy, and sell digital items using fiat or cryptocurrency. Now Mintable will integrate XRP Ledger (XRPL) for NFT purchasing and selling.
So long as all parts of the market, such as marketplaces, blockchain developers, and payment solution developers, see the potential in the NFT industry, it might have a bright future indeed and will not remain as the mere hype of 2020-2021.
Celebrities as well see the NFTs as one more opportunity to interact with fans and collect royalty.
As Busta Rhymes said, “I still work with labels, but with NFTs I see that I might not need that middle man.”
It is hard to predict the future, but for now we can tell that NFTs truly became a big part of not only crypto, but art, gaming, and entertainment industries as well.