How NFTs are changing digital economies

There’s a lot of confusion about what NFTs actually are — especially regarding their implications for the future.

What are NFTs?

NFTs stand for Non-Fungible Tokens. Non-fungible means that it’s unique and can’t be replaced with something else. For example, US Dollars are fungible: every dollar is equivalent. If you traded one dollar for another, you’d still just have a dollar.

In contrast, a unique piece of art like the Mona Lisa is non-fungible. If you traded the Mona Lisa for another piece of art, you’d have a different piece of art. Importantly, even if you traded it for a carbon copy of the Mona Lisa, you still wouldn’t own the Mona Lisa. The Mona Lisa is one-of-a-kind and not interchangeable with any other piece of art. In the context of Highrise, Gold and Bubbles are fungible. A unique Legendary item that is 1 of 10 in existence is non-fungible (spoiler: we’ll be adding unique items that are 1 of N numbered).

NFTs are stored on the blockchain, just like fungible cryptocurrencies like Bitcoin. Typically, most NFTs have been created on Ethereum, but other chains like Solana have emerged as strong technologies for NFTs.

As a matter of fact, the most important part of NFTs is that they are stored on the blockchain, and not in the database of any organization or individual. For a quick refresher, blockchains are databases that are stored on thousands or millions of computers. This means that when you own an NFT, nobody can take it away from you. On top of this, you can do whatever you want with it — sell it, trade it, lend it, or use it with any other function that applications build for NFTs.

Why do NFTs matter to me?

Why does all this matter? And particularly, why does it matter to you?

If you’re playing Highrise, you already know digital items have value. Many Highrise citizens have been buying, selling, and trading items for years! But, as you know, these items only exist in the Highrise ecosystem. They only have value within Highrise. They can only be traded using Highrise systems. You can’t trade a Highrise item for US Dollars.

NFTs allow you to do whatever you want with your Highrise items. Suddenly, you can trade a Highrise item for US Dollars or Ether. You can lend out your Highrise items using 3rd party applications. Don’t like the prices that Highrise or another marketplace charges? You can use a different marketplace! It gives you the ultimate flexibility to use your items as you need.

In the future, it’s possible other applications will support Highrise items and you’ll be able to see your items there, too. And likewise, we’ll increasingly support items from other products and applications. It creates one giant, interconnected digital world. That’s the future we are so excited to be building with you!

building the metaverse @pocketworlds