Wading Into an Ocean
Akin to the transition from barter and trade to the exchange of currency, Non-Fungible Tokens are digital currency that represent real-world items (artwork, real estate, first edition books, property rights, etc). The intention is to make trading such commodities easier and simultaneously make theft and scams more difficult. NFTs have evolved to, in some cases, represent a person’s identity – and its value. NFTs are built using blockchain technology because it is difficult to hack, so they are usually secure.
Non-Fungible means these tokens represent something unique – which in turns makes them unique, and therefore unable to be exactly equal in value to any other NFT. This makes it easier to track the changing of hands of collectible items, such as artwork. This is why they can also be used as a type of digital passport, aka representation of a person’s identity. They have increasingly been a way for artists to introduce their work to fans without a middle-man.
Ocean of Cryptocurrency
For the Music Industry, this could mean more money for artists and more interaction between artists and fans. The middle-man being cut out in this case would be Record Labels. Artists like Snoop Dogg, Taylor Swift, Garth Brooks, and many more have complained for years about the way that music streaming apps like Spotify pay Labels but not the artists themselves. Enraged fans currently have little recourse, as few ethical music streaming companies exist – and few people own a CD player anymore. In April of this year, Snoop Dogg took action by pulling a selection of his music and discussing plans to create his own music streaming application. NFTs may be the solution to which he – and other underpaid artists – turn.
NFTs Currently Popular
Entrepreneur and CEO of VaynerMedia, Gary Vaynerchuk, recently suggested that the current popularity of investing in NFTs will eventually bubble out and pop – just like the dot-com bubble of the early 2000s. However, he doesn’t predict a recession-causing-crash, like with the housing market in 2008, but merely an evening out of investment choices. He expects that NFTs will be as normal as Google in time.