The World of NFT Art:
What are NFTs?
The phrase ‘NFT’ has been growing in circulation these last few months. From tweets being sold as NFTs, pixelated characters selling for $16,900,000, to you-tubers and celebrities releasing and selling their personal NFTs for thousands of dollars.
The word is out, so let's dive in and explain this concept more. NFT is an acronym for non-fungible token which refers to a cryptographic token representing a unique piece of information. 1 apple ≠ 1 apple, therefor they are not interchangeable.
A History of NFTs
In December 2016, Canadian app developers John Watkinson and Matt Hall from Larva Labs began working on a side project which would revolutionise digital art. In pursuit of nothing more than cryptographic curiosity, the pair generated a series of 10,000 pixel-art characters, each with its own unique features, accessories and life-form. The algorithm was programmed to test the dynamics of supply and demand by making some features rarer than others.
Photo Credit: Larva Labs
Watkinson and Hall titled these abstract artworks ‘CryptoPunks’ in an artistic tribute to a scarcely documented pioneer of cryptocurrency. The developers became intrigued with the idea of creating a non-fungible ERC-20 token on the Ethereum blockchain. At the time, all tokens built on Ethereum were fungible, meaning they could be interchanged in a marketplace where one equals one.
Non-fungible assets are unique, one-of-a-kind – think precious diamonds which all have different grades, sizes and therefore values.
To achieve this, they imprinted a cryptographic hash within each punk’s image file which linked that character to a unique smart contract. They launched their quirky punk project in late 2016 to little fanfare.
Fast forward four years and and there are over 6 punks that sold over 1 million dollar. The highest being $7.57M sold on March 11 2021 with it’s previous sale of only $12k in January 2018. Talk about appreciating value! You can view all CryptoPunk prices here.
These days different digital marketplaces continue to evolve with a now market value of over $550M.
Photo Credit: Cryptoart
Creating your own NFT
All this talk of NFT art has probably got you thinking… “Could I create my own NFT and sell it for a few thousand?”
In theory yes, in the same way you can create a physical piece of artwork and sell it for a few thousand. But that doesn’t tell the whole story.
NFT art is not some worthless, banana on the wall gimmick set for gradual demise, nor is it some hyped trend exclusive to coding-nerds and internet hippies.
They represent a genuine opportunity to tokenise assets like never before and will continue to contribute to the paradigm shift in the ownership of everything digital and physical.
For many in this internet generation, the prospect of owning a piece of digital blockchain art will become lucrative than anything hanging in a modern museum.
The very best crypto artwork is topical, meaningful and symbolic of an emerging culture, as much as a contemporary Banksy or Picasso masterpiece is. And the best is most certainly yet to come.
Investing in NFTs
Identifying value in an NFT marketplace is similar to analysing the fundamental and technical elements of a cryptocurrency project – it takes a high-level of skill, knowledge and intuition acquired through years of experience.
Quite simply, if you know how to buy cryptocurrency, you’ll know how to purchase an NFT. One of the most popular marketplaces for buying and selling NFT assets is opensea.io. The platform easily allows artists to create a digital collectible without prior knowledge of the intricacies of computer coding. Their slick user-interface allows seamless browsing and transiting for all crypto and non-crypto participants.
Simply connect your MetaMask, MyEtherWallet or alternative wallet, deposit it with ETH and you’re free to browse through the endless selection of digital art on offer!