How does NFT bring profit to business?
During the hype of 2021, NFT sales reached $25 billion. Speaking of companies that have managed to make a lot of money on NFT, first of all, they recall various NFT marketplaces, Yuga Labs, which became famous thanks to their Bored Ape Yacht Club (BAYC) collection, and Sky Mavis, which were able to develop the famous Play2Earn Axie Infinity, as well as. Most of these companies mainly work with digital art or in-game assets, with rare exceptions here are STEPN NFT sneakers from FindSatoshi Lab and barter crypto marketplace Barter Smartplace.
Today we will talk about what earning schemes famous NFT companies have used and why they should pay more attention to marking real assets if they want to get off the ground after the hype.
Digital art release
Much of the NFT hype of 2021 has been driven by the release of digital art. The aforementioned Yuga Labs made about $2 million from the iconic BAYC and then Mutant Ape Yacht Club brought them an additional $96 million.
Sometimes we are talking about the trade in tokenized digital copies of real works of art — the Hermitage and the Uffizi Gallery managed to excel in this.
The value of art is subjective, so it is very attractive for speculative trading. But now the digital art market is overheated — it is problematic to make money just on digital pictures. The company should pay attention to marking real assets using NFTs.
Fees
NFT marketplaces and Play2Earn games earn money via transaction fees, which can vary greatly from platform to platform and blockchain to blockchain. NFT marketplaces also earn money from fees for tokenizing assets and placing ads.
For example, Sky Mavis in their game Axie Infinity charges a 4.25% fee when players trade Axies monsters (which are technically NFTs) on the marketplace. As of press time, Axie Infinity’s lifetime sales have reached $4.25 billion, according to DappRadar.
Nowadays, most platforms do not dare to tokenize real assets, such as transport, real estate, clothes, because this leads to additional legal difficulties. But, Barter Smartplace does not bother you — here you can mark any real asset.
Royalties from secondary sales
The essence of this way of earning is that the original owner or company receives a percentage of the sale price every time a particular NFT is sold on the marketplace. Before NFT technology, it was legally very burdensome to implement a constant payment of a percentage of secondary sales, but with the advent of non-fungible tokens, this has become truly convenient with the help of smart contracts. For example, Yuga Labs receives from its monkeys from 2.5% to 5% of the value of the secondary sale.
Again, for the time being this is applied exclusively in the virtual sphere, but in the future it makes possible a similar way of earning money for real estate or transport — i.e. you will receive a percentage of secondary sales when you resell apartments, land, cars, etc.
Promotion
More traditional companies and artists far from blockchain technology are also using NFTs, but more often to promote themselves. There are many examples here, including Coca Cola and Gucci, Ferrari Esports and many others. Coca-Cola, for example, raised $575,000 from its NFT auction.
But, here we are talking more about promoting your brand among crypto enthusiasts, and not about making money on NFT directly. In any case, advertising is the engine of trade, it is also a profit for business.
And what about future?
Potential of NFT technology is not yet fully realized i— NFT’s must go beyond just virtual assets. In the future, fractional ownership of real estate will become much easier with the help of NFT technology, for example.
Now real estate is often too expensive an asset for an ordinary person, but in the future it is quite realistic to imagine a situation where you can raise funds for real estate on the basis of crowdfunding, where each invested person receives his share in the form of an NFT asset
Surely, innovations will not be limited to this, people are very inventive in finding new ways to earn money.
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