What are NFTs? Answer A: Not For Tourists, Answer B: Non-Fungible Tokens, Answer C: The future of art form. Simply, there is no right answer. At the very base, NFTs are a unique software representation. You can copy it at will but only one person can own it.
This new format was embraced by artists of all feathers as a way to claim back the rights to their creations, and make a few bucks along the way. Modern Andy Warhols certainly welcome new means to mass produce art, and send it across the planet at speed in one click. If it sells in millions, even better.
Gombrich would probably agree that technology and mercantilism are intertwined in the production of art, and there is no surprise that artists would rise up to the challenge. More surprising though is the attitude of some who discard NFTs as the latest get-rich-fast play of the cryptosphere, and lament the absence of smell or feel to it. It’s not the point. NFTs are in fact a reflexion on our digital times, and simply get us to think about the path we’re getting onto.
In a dystopian metaverse, we could well use NFTs as digital rights to our gaming avatar in Decentraland, or the e-clothes or e-background we’ll be using in our next Zoom call. NFTs are not there to like or dislike, but simply a means to express status another way.
Beyond art, the applications are plentiful. Fashion, collectibles, gaming, which collectively attracted $500m of transaction volume over the past 3 years. The fact that NFTs become assets in their own rights get the cogs of finance started, with new abilities to obtain loans against your NFTs or design new financial derivatives. If anything, NFTs are a passing beauty in a digital world that is here to stay.
360 Advisory – Markets