May 2, 2021 4 min read
Opinions expressed by Entrepreneur contributors are their own.
There’s no doubt that Non-Fungible Tokens are the most popular trend in the crypto community right now. From celebrities to respected companies, everyone is talking about launching their own NFTs. But not all NFTs are made equal: while some are worth a fortune, some can be practically worthless. Let’s take a look at some of the most profitable ways individuals and companies are making money during the current NFT gold rush.
1. Digital Works of Art
When it comes to sheer profitability, individual NFT artworks are by far the most valuable Non-Fungible Tokens ever created.
On March 11th, the history of blockchain technology and the history of art changed forever. Christie’s, one of the most renowned auction houses in the world, sold an NFT work of art for $69 million. It was the first time when Christie’s auctioned a fully digital artwork.
The piece entitled “Everydays: The First 5000 Days” was created by a digital artist Mike Winkelmann, better known as Beeple. The NFT is not a single artwork but a collage of 5000 tokenized images which Beeple was creating every day over the course of years.
While some people are already raising concerns that selling what is essentially a link to a picture for millions of dollars could be just a front for money laundering, others believe that NFTs are a true revolution in the world of art.
The record-breaking price set by Beeple’s NFT may soon be surpassed. After all, Beeple was, until very recently, a completely unknown artist. If someone like Banksy decides to auction an NFT work of art, the price would likely be much higher than $69 million.
2. Licensed Collectibles
Tokenizing collectibles seems like the most natural and obvious application of the Non-Fungible Token technology. The brands which were already selling physical collectibles such as trading cards can now also sell the same thing in a digital form. Since NFTs have provable rarity, the price of a digital trading card can be much higher than the price of its physical counterpart.
So far, sports cards are by far the most popular type of licensed NFT collectibles. The first NFT sports cards project allowed people to trade licensed cards of footballers, but recently the NBA has also launched its NFT cards collection. It’s very likely that other sports organizations will soon follow, and collectors will be able to buy baseball or hockey NFT cards as well.
But sports cards are just one example of what NFTs can be used for. Any physical collectible can also be turned into a Non-Fungible Tokens. While physical trading cards are easily damageable, NFTs can be securely stored on the blockchain, and they will never lose quality.
3. NFT Video Games
The NFT-based video games could very well be the future of NFT technology. So far, none of the games utilizing Non-Fungible Tokens managed to gain widespread popularity, but the potential of applying NFTs to video games seems tremendous.
Gamers are already known to spend fortunes on virtual items. World of Warcraft gold, Call of Duty loot boxes or Counter Strike skins—all of these markets are already worth billions. If any major video game company decides to sell in-game items as NFTs, the impact of such a decision on both gaming and blockchain ecosystems would be tremendous.
It’s also worth noting that NFT video game developers are among the most ambitious Non-Fungible Token creators, and NFT in-game items might push the evolution of Non-Fungible Technology forward.
Compared to simple digital trading cards, or even to more interactive NFTs like virtual works of art, in-game NFTs are by far the most advanced. Non-Fungible Tokens utilized in video games can be very complex, fully interactive, and they can change over time, for example, by being upgraded or by leveling up along with the player’s character.
Non-Fungible Tokens are much more than just another quickly passing crypto trend. The NFT technology has many unique applications, and the full potential of NFTs is only beginning to be explored.
It seems like the NFT gold rush is only starting as more and more individuals and businesses decide to enter the Non-Fungible Token ecosystem. The fact that the most popular NFTs are still simple images suggests that the market is still very undervalued – the true eruption in NFT popularity might not begin until complex Non-Fungible Tokens exploring the full potential of the new technology become more popular.