Why are NFT's Such a Big Deal?
and how can they interrelate with fiction writing?
Why are NFT’s such a big deal? To me, they’re a big deal because they are a brand new piece of technology that allows us to do something we’ve never been able to do before.
The implications have yet to be seen in its fullness. This means we can become technological pioneers!
If you missed it and are confused as to what an NFT is, check out my previous article to get a refresher:
Why Do People Like NFTs?
Psychology is incredibly fascinating, isn’t it? Figuring out why humans react in certain ways. This is the intriguing part of NFT’s. I read a book about NFT’s called NFT Art and Collectibles for Beginners: The Must Have Guide for Understanding Non Fungible Tokens (NFTs) by Chris Collins. He has a really cool quote about this:
“you can also see or digitally save a video clip or art online for free; however, collectors are still willing to pay a considerable amount of money for the right to possess the "official" version of the art or clip.”
Did you see that? A video or art piece can be downloaded for free. I’m not talking about piracy, but things that have been released for free. Like a Youtube video. However, there is something inherent inside of us (probably our sinful pride) that thinks it is unique to own the original copy. This is what NFTs unlock.
The book also points out that “since ancient times, we are hardwired to collect. It is a basic survival skill.” According to Maslow’s Hierarchy of Needs, “The act of collecting supports esteem requirements and self-actualization (i.e., the desires that offer us the highest amount of personal fulfillment).”
We now have the power to collect digital items! Something we didn’t have the capability to do until now.
Use Cases of NFTs
However, NFT’s have more uses than just hacking a person’s psychology. They can also be used for trademarks (something I’m sure we’ll see more of as time goes on) and eventually legal contracts and maybe even official government documents! What if instead of carrying a physical passport, you just had to carry your phone?
As of right now in history, there are a lot of different experiments with NFT’s. People are even selling their tweets! That’s crazy.
Some of the more popular things are digital trading card games, Cryptokittens, and even purchasing virtual real estate. That’s right, virtual real estate. A group of techies have created Decentraland, a virtual reality where people can buy and trade virtual real estate, build homes, and create a virtual life. To be honest, it’s a little scary. But it exists!
Cryptokitten is one of the biggest names in the NFT world right now. Mainly because they’ve been selling each kitten for hundreds of thousands of dollars! The idea is every single cat is unique and you can purchase different cats, breed them, and create your own unique cats for others to buy and trade. It’s pretty fascinating.
Gaming Industry and NFT’s
The gaming industry is one that will see a lot of growth due to NFT’s. The book gives a great example:
“For example, when a player buys an armor upgrade in a typical game, their only advantage is improved gameplay in the setting of that one game. But, in a gaming network that uses cross-platform non-fungible tokens (NFTs), the equivalent armor can be tokenized in a manner that converts in-game buys into assets that can be transferred. It might deliberate benefits across interconnected games or be exchanged for money or other digital assets.”
I remember back in the day, people would play this game called Runescape (myself included). I never got super into it, but a lot of people would spend hours crafting the perfect character and crafting the perfect armor. I had a few friends who would craft these perfect characters and then sell their credentials so other people could own their account!
Well with NFT’s, you wouldn’t have to sell your account. You could just literally sell the armor as an NFT to the highest bidder.
Another use case is if you’ve ever purchased a skin or anything for the game Fortnite. Well, once you buy it, that’s kind of it. You can’t sell it or get your money back. You can’t use it in any game except Fortnite. What this book suggests is just the opposite. With NFT’s, not only would you be able to sell that skin later and get some money back, but you could use that skin in other games than just Fortnite! That’s cool!
Writing, Books, and NFT’s
The one place I have yet to see a lot of growth in, but people believe will be incredibly helpful is writing.
One of the biggest reasons for this is royalties. When you create an NFT, you can set a royalty percentage. For example, let’s say you set your royalty at 10%. Well, now whenever someone sells your NFT to someone else, you collect 10% of the sale. Forever! Thanks to the power of blockchain. This adds a whole new revenue stream for writers that didn’t exist before.
Not only that, but think about this. When you buy a paperback book, you can sell it to a used book store. That used book store can sell it to someone else and the cycle continues forever. What about ebooks? You buy an ebook and are stuck with it forever. You can’t donate it, sell it, or anything. You just own it even if you hate it.
However, with NFT’s we have now unlocked the capability to have used ebook stores. I think it will be a long time until that happens, but it will be a cool day when it does. I have a lot of kindle books I either lost interest in and didn’t finish or have finished but will never read again. I would love to be able to sell those to a used book store, or even give them away. Neither of which Amazon lets you do :/
The moral of the story is that we have barely broken the ice of NFT’s (if we’ve even broken it). We have a lot to learn and I am excited to jump in and experiment with the rest of the pioneers!
Stay tuned for my first experiment and how you can be involved too!