NFT: What Is It And Will It Be in 8.Finance Metaverse?
You have probably heard of NFTs, but they are usually defined in a complex way. We at 8.Finance like to discuss complicated things in simple terms. Let us explain in the simplest terms what NFTs are and what you can do with them.
NFT stands for non-fungible token. Let us get into this one by one. First, what is fungible? Basically, it’s something you can easily exchange in whole or in parts for the same kind of thing. For example, you can exchange a $100 banknote for 100 $1 banknotes, or for 20 $5 banknotes, or for 10 $10 banknotes, etc. With NFTs, you can’t do that, because NFTs are non-fungible, unlike cryptocurrency itself. Imagine your favorite computer game, is it fungible? No, you can’t exchange it equally to any other computer game, because it has unique graphics, a one-of-a-kind plot, exceptional characters, etc. So, with NFT it’s the same, you can’t exchange it for equivalent things, but you can trade it, it exists on a blockchain.
Reminds of something, doesn’t it? Yes, it is a sort of asset. NFTs have unique numbers, so they can’t be forged, they can only belong to a particular person, which means they are exclusively owned, but publicly seen and copied. The main difference from the paper assets is that NFTs are digital. The examples here can be paintings, in-game purchases, photos, and music. And the thing here is, you can copy the picture, but you can’t copy the NFT of that picture, meaning you can’t be an owner if you have a copy. To be more precise, if you copy a picture, it wouldn’t cost as much as the original, because the NFT and the ownership of the original picture are unique.
Again, you may trade your NFT and get money for it, but its price may greatly fluctuate depending on the market.
How can you make money with NFTs?
- Trade it.
Buy it and sell it, easy! Actually, not just buy and sell, but buy at a cheaper price and sell at a higher price. That is where the profitable investment comes from. Why? Firstly, because you don’t have to mint it. Secondly, it is crucial to catch the right time and choose the right NFT to buy. Hence, it could be an excellent strategy to invest in start-ups by purchasing their NFTs. By the way, those who want to invest in 8.Finance can have 2 options: either to purchase tokens (as usual). Or to buy tokens “wrapped” in NFT. To do this, all you have to do is provide a BEP-20 wallet address. By the way, this possibility is gonna be in 8.Finance. Normally that’s impossible to transfer the allocation to another user, but with help of NFT, it is possible. To sell the allocation to another user, the investor could notify the team while buying, that he wants to wrap the tokens in the NFT. He provides the team with the address of his BEP-20 wallet and receives NFT on it, in which the tokens will be “wrapped”. Then the location can be sold to another investor. The vesting of tokens will not begin until the NFT has been unwrapped. In this case, the location can no longer be sold to anyone, and the investor will receive tokens within 12 months of vesting. Vesting activation is an irreversible process, it is impossible to turn your allocation back into NFT.
2. Get royalties.
The easiest way to get passive income. Imagine, you minted the NFT, and you sold it. First and foremost, you can easily prove that you are the original creator, this information is encoded and cannot be forged. Every time your NFT is sold, and it can be sold multiple times, you get a percentage for it on your balance. Awesome. The complex thing here is to set up all the financial issues, including the percentage itself, but it’s worth it.
Those games are called “play-to-earn” (P2E). You can buy and trade unique game items, such as Avatar or ammunition (8.Finance is going to introduce that utility), and acquire unique ownership of these items. As long as you upgrade your Avatar, the NFT price grows accordingly. Some games can even give away those NFTs for free, or at a very low price at the very start. But the issue worth mentioning here is, that you still don’t own those items outside the platform, but inside the platform, you can sell them, and do whatever you wish. A far more advanced way of making money, indeed it is.
NFTs are collectibles. Moreover, staking here means locking NFTs up on a platform (it can be a DeFi platform, like 8.Finance) to support the blockchain operations in exchange for profit. This means that you still own a collection of NFTs, and at the same time you get the money for it. 8.Finance expects passive income from NFT stacking to be 30% in project tokens. How does it work? 3% of all project tokens will be divided within 12 months between users who stake their NFTs. A limited number of users can take part: up to 10% of all project coins can be staked at the same time. When an NFT is staked, all utility functions of the NFT remain active.
Where to trade NFTs
Let us switch to the existing platforms, the marketplaces where you can trade your NFTs. Undoubtedly, you don’t need to be tied to any of these platforms, you can sell your NFTs without any intermediary interfering in it.
- OpenSea. The best choice for a novice to use, one of the oldest and most popular marketplaces. Minting is available here for users. You can sign up for free and trade all kinds of existing NFTs. It is supported by Ethereum, Polygon, Klatyn blockchains, and accepts over 150 cryptocurrencies.
- Rarible. The second most popular platform, similar to OpenSea. The main difference here is you are obliged to use the marketplace’s token Rarible (RARI) to trade. You can choose between 3 blockchains on that marketplace: Ethereum, Flow, and Tezos.
- Axie Marketplace. An example of a play-to-earn game platform. You can buy Avatars here and upgrade them by playing the game. As long as you get a new rank up or win a new reward, your NFT value rises. The marketplace is supported by Ethereum blockchain.
- Mintable. To get onto this platform, you have to obtain Ethereum and connect your existing wallet to it. But then you get a chance to mint your own NFTs for free. Moreover, this one is as easy as a pie to use.
What are utility NFTs?
Basically, those are the NFTs that have some additional functions.
- First of all, you can buy the physical copy of the work that your NFT is backed up. The easiest example here is a painting. You buy the ownership of this painting (NFT) and you get the painting itself.
- Moreover, the company where you purchased NFT, can give you premium access to multiple issues. 8.Finance develops NFT staking, participating in closed community activities, VIP chats, and many other privileges that will also be included.
- Generally, the only chance to upgrade your avatar in play-to-earn games is to have an NFT. Without the NFT you just can’t buy the game items and get a higher rank. 8.Finance will give you mysterious snake skins for free if you are an NFT owner!
- Another utility NFTs have in gambling. Some casinos use NFTs instead of money to gamble. The process remains the same, you earn NFTs and you bet with NFTs.
Here is everything that covers the NFT topic, we did our best to put it simply. 8.Finance is only at the stage of introducing NFTs to the Metaverse, but they obviously have a future in their ‘hands’! As always, this is a good way to earn good money, but you have to make reasonable decisions. And probably it is high time you get started with your own NFTs!
The data in this article has lost its relevance; see the current information in the gitbook.