Why was $69 million given to an image that we could all access for free on the internet? Let’s look at the story of Non-Fungible Token (NFT) together.
Most of us got surprised when we heard that a digital picture created by combining JPEGs was sold for $69.3 million recently. Moreover, anyone could download this picture on the internet.
We started asking ourselves this question: Why would someone pay $69.3 million for a painting that everyone can easily access and reproduce, as much as they want?
Twitter CEO Jack Dorsey sold his first tweet as an Non-Fungible Token for $2.5 million. Why would anyone buy Jack Dorsey’s first tweet for $2.5 million when we could easily find it online?
Well, what is Non-Fungible Token (NFT) then?
Non-Fungible Token (NFT) is a unique coin, as can be understood from the name. NFT is an indivisible and unique symbol, a singular value that is one of a kind. These are the tokens that have been produced in one single copy. CoinMarketCap data, there were a total of 18,521,531 BTC in the market in November 2020. All of these BTSs are the same but NFT is completely unique.
We can say that it is the proof of the digital equivalent of a picture, sound file, video or physical entity. In other words, the person who buys a work as NFT receives a digital certificate, a token, certifying that the work has its “original”.
To easily understand this, we can think about original works of art. For example, you can download copies of Vincent Van Gogh’s Starry Night, completely free from the internet and get a print in any size you want. But, you would have to spend a lot of money to buy the original Starry Night painting, would you not?
Or, let us consider those football player cards that some would find interesting to collect. We can imagine how valuable the rare cards will be, right? Here, we can think of NFTs as a digital version that prevents these cards from being copied. Thanks to the blockchain technology, which has been the backbone of crypto coins, the digital asset can be protected. The protected asset is encrypted to give access to its owner only.
Now, I want to give some examples from the gaming world. Those different weapons and skins we buy in the games are actually NFTs. A costume or a sword you buy in a game may not have a direct impact on your game, but you might still consider spending this money.
Let us not forget that we are the ones who put the value in a creation. The more people believe that a work is valuable, the more valuable that work will become.