With the rise of the cryptocurrency market and growing adoption of blockchain technology, a lot of people are wondering what NFTs are and what they’re good for.
NFTs, or non-fungible tokens, are digital assets that can be used to represent almost anything. They can be digital collectibles, game items, but also concert tickets or perhaps a digital key that unlocks a certain door.
As a result, you can look at NFTs as digital contracts of ownership. These tokens on the blockchain can prove that someone owns a certain piece of art or digital collectible, but they can also show you have lifetime tickets for your favorite band or season tickets for the sports team you live and die with.
What are NFTs used for?
NFTs are intended for the pleasure of collecting and potential financial gain through the scarcity and uniqueness afforded to each collectible. While the value of NFTs can vary greatly, some of the most expensive NFTs have sold for millions of dollars.
So, what are some potential uses for NFTs? Let’s take a look now at a few examples.
One use case for NFTs is digital art. Artists can create digital art and sell it as an NFT. This allows them to get paid directly for their work and also provides collectors with a way to own and display the art they love.
The music industry is one that is ripe for transformation. For years, musicians have been complaining about unequal wealth distribution foisted on them by the centralized recording industry.
Today, NFTs have the potential to return power to the creators, and big name artists are already on board such as Eminem and of course, the ubiquitous NFT OG himself, Snoop Dogg.
Another use case for NFTs is gaming. Game developers can create in-game items that can be sold as NFTs. This could include things like weapons, armor, or even just cosmetic items. Players could then use these NFTs to show off their accomplishments in the game or trade them with other players.
For players, NFT in-game items combine utility and collectibility. Furthermore, blockchain technology may aid in ensuring that gamers purchase and trade genuine items, as well as provide accurate transaction records.
Given the amount of money flowing into NFT-powered blockchain games and the number of people playing Axie Infinity, it appears that gaming NFTs are here to stay.
When you attend a special event, you may want a memento to remember it by. That could be your concert ticket stub, a refrigerator magnet from a souvenir shop, or a badge from an important conference you attended. A POAP (Proof of Attendance) NFT is a digital representation of these keepsakes.
NFTs can also be used for event tickets. For example, a concert venue could sell tickets as NFTs. This would allow people to buy and sell tickets easily and also prevent ticket scalping.
NFTs are poised to modernize loyalty programs that have fallen out of step with today’s consumers. Check it out:
- According to a CFI Group study, nearly 40% of shoppers believe loyalty programs are no longer worthwhile.
- NFTs can enhance loyalty programs by providing customers with more than just points for future use.
- Clinique, a cosmetics brand, for example, gives its loyalty members the opportunity to win one-of-a-kind digital artworks as well as be rewarded with multiple cosmetic products over the course of a year.
- Coca-Cola recently auctioned off ‘loot boxes’ of NFTs, including digital apparel that can be displayed in the Decentraland metaverse platform (MANA).
As you can see, there are many potential uses for NFTs. Even with the volatility of the crypto market one can see some potentially lasting applications for NFTs.
We’re likely to see even more innovative uses for NFTs in the future. So if you’re interested in getting involved in the world of NFTs, now is a great time to start learning about them. Who knows, maybe you’ll be the one to create the next big use case for NFTs!
What are your thoughts on NFTs? Will they have lasting value and use cases or are they just a passing fad? Let us know in the comments below!
P.S. If you want to learn more about NFTs, check out our beginner’s guide to NFTs.
Jay Speakman is a technology writer based in San Francisco, California. He writes on the topics of blockchain, cryptocurrency, DeFi and other disruptive technologies. Clients include Avalanche, Be[in]Crypto, Trust Machines and several blogs devoted to blockchain gaming. He will not rest until fiat currency is defeated.