WHAT IS AN NFT?
An NFT is a digital asset that lives solely in the digital universe. For example, an NFT can be a digital file, such as a work of art, an article, music, or even a meme. They are bought and sold online and are usually encrypted with the same software as many cryptocurrencies. Although NFTs have been available since 2014, they have experienced a sudden rise in popularity as a means to acquire and trade digital art. A total of $174 million has been spent on NFTs since November 2017.
NFTs are typically created as one-offs or in small quantities, and They also carry a unique identification code.
This is in sharp contrast to most digital creations, which are usually not limited in supply. If a particular asset is in demand, an interruption in supply should theoretically boost its value.
However, many NFTs were digital compositions that previously existed in some form elsewhere, such as legendary video clips from NBA games or securitized versions of digital art circulating on Instagram in the early days.
Individual photos, as well as the whole image collage, are available for free online viewing. So, why are individuals prepared to spend millions of dollars on something that can be readily screenshotted or downloaded?
Because an NFT gives the buyer ownership of the original item, it also comes with built-in authentication, which serves as evidence of ownership. These “digital rights” are almost as valuable as the thing itself to collectors.
A good way to understand the value of NFTs is with the following analogy:
Imagine we had the best copy-painter in the world, let’s suppose he exists. We commission said painter to copy the Mona Lisa. We then take that copy painting and hang it in our offices. The thing is, no one will ever believe this is the original painting no matter how good the copy work was. That is because everyone knows where the original Mona Lisa is, almost with absolute certainty; it’s in The Louvre. So when an NFT is minted, the original NFT will reside on an immutable (unchangeable) address on the blockchain and like the Mona Lisa in The Louvre (and with more certainty) “everyone” can know where the original NFT resides and in which wallet.
DIGITAL ART OWNERSHIP
Designers must get legal ownership of their work to sell NFTs. As a result, the NFT artwork is minted or tokenized on the cryptocurrency service Blockchain when it is created. The blockchain is a digital transaction system that saves information in such a way that it is extremely difficult to hack or cheat, making it ideal for copyright tracking and retaining records of the invention.
Therefore, every digital artwork you produce and imprint, in theory, only leads to you. This procedure should, ultimately, enable digital artists to earn legitimate acknowledgment for their work. However, the problem with this brand-new concept is that while blockchain includes smart contracts that support the legal aspects of minting and copyrighting crypto art, they have yet to be tried in court.
Artists have already come out to report that their work has been forged and sold by con artists. However, without sufficient legal protection or current legislation on the matter, it is unclear what these artists can do about it.
With NFTs continuing to grow in popularity, this will have to be addressed by regulators in the future.
NFTs AND BLOCKCHAIN MUSEUMS
In the past, expensive works of art were kept hidden in the silos of private art galleries or state-funded, walled museums. Museums are primarily public institutions that receive their necessary funding from tax dollars. Indeed, traditionalists want things to continue as they have for decades or even centuries.
Given the digital upheaval in almost every sector, public art institutions will tend to embrace NFT technology. This will enable them to deal with a newer generation of art fans independently and more efficiently.
NFTs offer museums the opportunity to expand their revenue streams. Instead of relying on revenue from a combination of ticket sales and public funds, museums can tokenize all of their paintings and artifacts.
It is also possible that museums could experiment with collective ownership of NFTs through their own marketplaces.
NFTC and Distributed Museums
The NFTC Museum brings together all elements of collecting and disseminating works of art. Works of art by various artists are exhibited in many locations in a variety of exhibition formats, techniques, and programs. The option to host exhibitions at unconventional sites is what truly sets NFTC from others in this space.
CONCLUSION
Digital art has long been undervalued; this has been in part due to its accessibility. NFTs add the key ingredient of scarcity to help artists build financial value for their work. Some collectors are more likely to seek out the “legitimate” piece if they are aware that the original version exists. Scarcity is one of the reasons why baseball card collectors are ready to pay $3.12 million for a piece of cardboard with a picture of Honus Wagner, a renowned Pittsburgh Pirate. It’s also why sneakerheads are so excited about Nike and Adidas’ recent limited-edition releases.
Furthermore, NFTs are creating new opportunities in the art community that did not exist before. For example, artists can attach stipulations to an NFT that ensures they get some of the proceeds every time it gets resold, meaning they benefit if their work increases in value.
New art platforms are able to show that they own digital works in a very simple way. When customers borrow or buy art from the platform, they can display it on a screen, knowing that there are no copyright or originality issues because the NFT and Blockchain ensure that ownership is authentic.
NFTs make art more functional in the digital age.
