Over the past few months, the popularity of new forms of crypto assets has exploded. Celebrities talk about it, and “cryptographic experts” argue whether they are the next smart investment, but many people don’t even know what an NFT is. So what are they?
NFT stands for “Non-Fungible Token”. Coinbase defines NFTs as “a special kind of crypto asset where each token is unique.” This is in contrast to all “substitutable” assets of the same amount, such as Bitcoin and dollar bills. All NFTs are unique and can be used to authenticate ownership of digital assets such as artwork, recordings, virtual real estate and pets.
NFTs began to gain popularity in February 2021, when an artist known as Beeple sold a 10-second video for $ 6.6 million. The collector who bought the video in exchange for their money did not receive a physical representation of the artwork. Instead, I received an NFT, a token that proves that each owner’s version is genuine.
Basically, an NFT can be a work of art, a domain name, a musical piece, a trading card, or almost any digital product with added value, or even a tweet.
With exponential growth, NFTs raised philosophical questions and raised controversy over whether they made sense. Proponents of NFTs explain that they buy their own traceability, which leads to social fame. According to Beincrypto’s article, “holding one of the millions of replicas is one thing, but holding part of the cultural history that can be traced directly to its creator is a completely different thing. is.”
Meanwhile, NFT skeptics have severely criticized this new form of cryptography. People on the Internet continue to call them “multidimensionally terrible” or fraudulent.
In addition, experts have criticized NFTs and the risks they pose. According to a Washington Post article, Nobel Memorial Prize in Economic Sciences Paul Krugman called cryptocurrencies a “huge bubble” and “the subprime mortgage crisis as there is increasing evidence that crypto risk is reduced. It’s disproportionate to people who don’t know what they’re working on and are inadequate to deal with the downsides. “
However, the most distinctive part of NFTs is the push that celebrities offer across social media and television. Celebrities such as Matt Damon and Gwyneth Paltrow promote digital art and invite everyone to participate in it. Celebrity nominations are particularly relevant after Krugman’s statement. These celebrities influence followers and get involved in unfamiliarity.
But the celebrities jumping on the trend weren’t all positive about the popularity of NFTs. Jimmy Fallon has received brutal criticism from one of the last episodes of The Tonight Show with special guest Paris Hilton. In the episode, Fallon and Hilton talked about NFTs, clumsyly showing off their acquisition (hatted apes), and explaining that the apes bought to “remind themselves.” After the episode aired, people defeated Fallon on Twitter, calling this segment the most annoying, deaf, and dishonest they’ve seen.
Simply put, NFTs are a new digital way to make money. But like any other investment, there are risks and it is not suitable for everyone.
Photo courtesy of Andrey Metelev of Unsplash