On July 4, the official online NFT auctioneer for Major League Baseball, Candy Digital, sold a digital copy of a historic speech by baseball legend Lou Gehrig. The July 4, 1939 speech marked Gehrig’s formal retirement from baseball after he was diagnosed with ALS. It was the League’s first foray into the exciting world of non-fungible tokens, or NFTs. The opening bid was $250. Gemini cryptocurrency exchange co-founder Tyler Winklevoss hyped it up on Twitter. The closing bid was about $70,400. Tyler Winklevoss bought it as a donation.
On Monday, NFT fans (and maybe Mookie Betts fans) can bet on an image of the LA Dodgers World Series 2020 ring created by so-called metaverse artists RTFKT Studios in Los Angeles. NFTs are digital art and audio clips that are sold and traded on exchanges such as Bitski in cryptocurrencies, usually, but not always, in Ethereum (ETH). They are part of a new asset, call them virtual assets. Enjin coin has started to rise.
If you are a sci-fi fan and have seen shows like Caprica, you can imagine owning virtual real estate, virtual nightclubs, virtual clothing, virtual art for your virtual apartment. Nothing tangible. But in the sham world of virtual reality and the Internet, if the right name is given to it, it can sell for tens of thousands of dollars. Why this is a thing I will never know, but I bought Enjin coin just in case.
“Yes, people play games in virtual worlds where they trade NFTs and some NFT real estate goes for tens of thousands of dollars,” said Adam Chaplin, CEO of DeFi for You in the UK, a peer-to-peer lending platform where users can get loans in crypto while using NFTs, cryptocurrency assets and physical assets as collateral.
I asked him about paying for mock swords and armor for the crypto gamer nerds Enjin is built around. Not only do they spend a lot of money, they also make a lot of money, he tells me. As a crypto investor I hear about this NFT thing and I feel like Indian Jones is stepping into a pit of double stinger scorpions; thinking, what the hell is going on right now? “The $500 sword…yeah, that’s on the cheaper end of the spectrum,” he tells me. NFTs are crypto tokens backed by digital art or audio.
Crypto investors looking to move beyond the top coins and even the decentralized financial coins consider NFTs to be the latest gambling chip. Unlike roulette, where your odds of making money if your odd or even bet is close to 50/50 (unless it lands on the two green squares), buying NFTs is like betting all your money on double-zero.
Contrast with alt-coin
Unlike the alt-coin traders on Coinbase, and the Bitcoin “hodlers” (hold, misspelled. It’s a crypto typo that has become a new word), NFT is also used for people who actually have an audio soundbyte of 10 seconds from the first Beastie Boys recording. Or an original comic by Dilbert artist Scott Adams. Different exchanges sell different offerings, much like Nasdaq where you buy Apple stock, not the NYSE.
“People pay a lot of money for NFTs because the value of those NFTs continues to increase. They hope to make money from high risk, high reward digital assets. They are also collectibles, so some people can literally burn money to have a collectible “There are a lot of millionaires in crypto, and to put it bluntly, a lot of them are geeks spending money on a digital sword.”
For the true NFT believer, NFTs are about much more than just trading coins or a random piece of art
“In the near future, I believe NFTs will disrupt sales in real estate and other markets as well. Virtual goods are just the first step on this path,” said Grigory Rybalchenko, CEO of EmiSwap (ESW), a cross-chain Automated Market Maker-Decentralized Exchange (DEX) topped up with the ESW token.The Young DEX reached a total value of $1.5 million within a few days of their launchpad sale.Repeat: A few days.Second Replay: This is for make believe items in a make believe world. FTX exchange is clear.
Imagine Jim Cramer trying to wrap his head around this. Or your financial advisor at Ameriprise. For investors, EmiSwap pays returns by staking, farming and using utility NFTs for investors seeking the risky crypto equivalent of a dividend.
Crypto investors in the NFT space should probably focus on the key trends in the gaming, sports and A-list creative industries, industry players tell us. It is just as easy to guess whether an NFT will be worth a dime, as it is to guess whether the silver ball on the roulette wheel will land on … double zero.
ESW launched at $0.19. It went to almost $0.90. Now it has dropped to $0.09
Unlike traditional cryptocurrencies, understanding the NFT collectible market trends is essential to monetize buying NFT in the future. The other way is to invest in the NFT platforms, or just buy ETH.
For creators who want to sell an NFT, a photographer can tokenize their photos before releasing them, meaning they can display the timestamp on the blockchain that it has been released, thus discrediting anyone trying to steal their work, for example.