The NFTs of today — How the Internet Computer is reinventing NFTs
“Non-fungible tokens are not an easy-to-characterize asset class, particularly because they can give the owner a wide array of rights to digital or physical assets…” — NFTs & the SEC: Statement on Impact Theory, LLC
The above is a recent statement issued on August 28, 2023, by the SEC, a regulatory organization based in the United States. We can perceive from such statements that despite the popularity of NFTs in the web3 space, there is still some lack of clarity on how to define them from a technological and financial perspective.
To gain insights into what NFTs are, and some interesting use cases of NFTs only found on the Internet Computer blockchain, we will be diving into the topic of NFTs in this article.
What is an NFT?
An NFT, short for Non-fungible tokens, is a unique digital asset identifier that represents ownership or proof of authenticity of something (e.g. art, music, videos, etc.) stored on the blockchain.
A key difference to note about NFTs is that, unlike cryptocurrencies such as Bitcoin or Ethereum, which are fungible and interchangeable, NFTs are designed to be unique (one of a kind). In other words, we can say NFTs are like physical paintings with unique properties.
In summary, the NFTs of today can serve different functions, let’s consider four (4) of those below:
1. Digital Ownership
NFTs authenticate digital ownership, allowing creators to monetize their work and collectors to truly possess digital assets.
2. Provenance and Scarcity
NFTs can provide an immutable record of an asset’s history, including its creation and ownership transfers, establishing scarcity and provenance.
3. Creator Empowerment
NFTs can empower artists, musicians, and creators to reach global audiences and receive fair compensation without intermediaries.
4. Innovative Experiences
NFTs are reshaping industries, from gaming to virtual real estate, by introducing new experiences and economies.
Now, let’s shift our focus to the Internet Computer blockchain’s approach to NFTs .
The Internet Computer’s Approach to NFTs
Let’s consider four (4) interesting usecase of NFTs on the Internet Computer today.
1. Storage
The Internet Computer’s architecture ensures that the entire component of an NFT is actually stored on the IC blockchain. Storing the entire component of an NFT implies that both the code and files, (pictures, video, music, etc.) aren’t stored on a centralized cloud service like Google Cloud, or AWS, but are stored directly on the blockchain.
To better understand this unique approach on the Internet Computer when it comes to NFTs, here’s a line from the privacy policy page (Last Updated, April, 4th, 2023) of Open Sea, a popular NFT marketplace.
Commenting about the information of users they disclose to third-party providers, the policy states,
“We may share your information and information about you with third-party service providers to: provide technical infrastructure services…”
In the real sense then, some aspects of users' data and NFT data are actually stored and managed on the servers of some centralized companies.
2. Digital Art and Collectibles
Artists can tokenize their work as NFTs on the Internet Computer, preserving their authenticity and ownership history. A good example is the Yumi NFT marketplace, which allows users to buy zero gas fee-enabled NFTs. Another example is NFT Studio which allows creators to mint 3D (3 dimension) NFTs stored on the ICP blockchain.
3. Music and Entertainment
On the Internet Computer, musicians and content creators can issue NFTs for unique songs, limited editions, or exclusive experiences. A good example of this is the Portal decentralized application built on the Internet Computer.
4. Social media
NFTs on the Internet Computer (IC) can be integrated into social media platforms. For example, on DSCVR, a decentralized social media platform built on the IC, content creators can restrict access to group chats to only those who own a specific NFT.
Conclusion
In this article, we have discussed how NFTs are paving a new era for digital ownership, creativity, and collaboration. Our analysis has shown that NFTs on the Internet Computer are helping to ease access to unique digital assets, empower creators, and enrich the digital world. Want to own an NFT? Create an Internet Identity here to get one for free.
The article series continues. In our next article in the series, we will be looking at how the Internet Computer blockchain design helps to reduce carbon emissions. Until then, we say thank you for reading. Please feel free to leave your comments in the comments section.
Join the Internet Computer community today
Homepage | Medium | Twitter | Telegram Discord | GitHub |
Disclaimer: The information presented in this piece is merely for educational purposes only, it contains the viewpoint of the author and does not constitute investment advice. Readers are kindly advised to do their research on the subject and are free to disagree with the viewpoints shared by the author here. Thank you.
