NFTs and the Creator economy. Why you should bother.
One of the most commonly held perceptions of NFT (non-fungible token) is that it’s just an overpriced jpeg that anyone can right-click and save. Eversince Beeple’s $69 million NFT sale caused the NFT world to literally explode, most people think of NFTs as expensive jpegs.
In reality, the blockchain doesn’t store the asset itself, like a piece of art. Instead, it stores the token that points to the asset outside of the blockchain. So, other assets, like documents, intellectual property, copyrights, music, and so on, can be held on the blockchain as NFTs.
NFTs are digital items that you can create, sell, trade, or swap on the blockchain. The tokens run on smart contracts, which is a code that runs on blockchain and can hold serial numbers, model numbers, and production dates. The smart contract can also keep track of who owns what and who doesn’t.
“Just because something doesn’t do what you planned it to do doesn’t mean it’s useless.”
— Thomas A. Edison
NFTs could be used to find out who owns something.
NFTs could be used to establish ownership of any item, such as a house, boat, or car. Importantly, an NFT can only have one official owner, and all ownership information is open and transparent.
Ownership of an NFT can be recorded on the blockchain, and there is no need for a third party to manage ownership. NFTs are immutable because once data is recorded on a blockchain, it is impossible to change. Ownership is also easier to verify than it is to verify ownership of a physical asset.
The five benefits of NFTs are
- Ownership of the asset can be recorded on the blockchain. There is no need for a third party to manage it.
- Ownership is easily transferable.
- Information on the ownership cannot be changed (immutable)
- Information can be verified.
- NFTs are tradeable on exchanges. As a result, NFTs have a higher value than physical assets.
Unfortunately, experts in the field think it will take a while (maybe years) for NFTs to mature and have greater utility. Between now and then, digital art will be a big part of NFTs.
So let’s talk about NFTs and the Creator Economy.
A big part of the web3 landscape is the “creator economy.” The core of the creator economy is made up of developers, artists, writers and musicians, as well as their fans and supporters. Creators use NFTs, smart contracts, and decentralisation, which are all based on Web3 principles, to work together without the need for middlemen. In a way, Web3 makes it easy for independent artists to sell their work to consumers directly.
“The sinews of art and literature, like those of war, are money.”
— Samuel Butler
Who are these people who buy NFT Digital art?
There are 5 general types of buyer personas and their reasons why NFT is special to them :
- Persona #1: They buy NFTs to appreciate art
- Persona #2: They buy NFTs to flex their socioeconomic status.
- Persona #3: They are speculators and expect the NFT to make a profit.
- Persona #4: They want to support a cause.
- Persona #5 They buy NFTs to join a community.
No matter why they are acquiring NFTs, a smart buyer expects the NFT collection to have a clear road-map for future roll-outs and that the collection is continually supported by an active community and preferably by a doxxed creator/founder of the collection.
NFT buyers are getting savvier and more discerning, especially in this bear market. They have seen the value of their NFTs plunge and have encountered rug pull and scams. So they won’t be too trigger-happy when parting with their money to get an NFT.
“Business has only two functions — marketing and innovation.”
— Milan Kundera
So really, how many kinds of NFTs are there?
- Profile pictures (PFPs): People buy collectables to make their online avatar profiles look more like them OR… look completely the opposite of what they look like.
Example: Bored Ape Yacht Club. - 1/1s (pronounced one of one). When judging 1/1 art NFTs, buyers look at the quality of the work, the artist’s reputation, and what other collectors think of the art.
Example: Beeple - Generative art: Art that is created from code or algorithms designed by programmers.
Example: Autoglyphs - Sports: Collectibles include teams, players, and memorable moments.
Example: LFC Heroes Club. - Virtual land plots, which are also NFTs, are what digital real estate is made up of. These are places in the metaverse where people hang out and spend more time.
Examples: Decentraland and Sandbox - Music NFTs make it easier for musicians to pay for their work and for fans to profit from their success.
A legal warning. Know what it is you’re paying for.
Buyer: When you buy an NFT, what do you actually “own”?
Creator: If you make a piece of NFT art and sell it, do you still own that piece of art?
Copyright automatically comes into being when a work is made, as long as it is the “author’s own intellectual invention.”
When someone buys an NFT from the person who made it, they own it in the sense that it is theirs.
The problem with internet content is that it is easy to share, copy, and duplicate because it is digital. People who buy NFTs need to know that doing any of these things without the right holder’s permission is a violation of the copyright. To get these rights, you must either own the work’s copyright or have the creator give you the copyright (in writing and signed).
Most people buy NFTs as a speculative investment or because they want to own something unique from a favourite artist, company, sports team, or anything else.
Buyers should also know that the blockchain can’t prove that a piece of art is real. Someone can steal someone else’s work and turn it into an NFT, which is against the rights of the original author.
So there you have it.
What has been your experience with NFTs? Share your story.
#web3 #nft #metaverse #crypto
About the Author:
Norliza is Decentraliz — a Marketer/Investor making the leap into Web3. She hopes to help the community and ecosystem through learning on Web3, NFT, Metaverse & Crypto. She is also a Certified Information Privacy Manager and has a deep appreciation of Data Privacy by Design when building businesses. Follow her on LinkedIn and Twitter.
