Why NFTs Matter and What You Need to Know

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It has been a rollercoaster week for the crypto markets, as the space has collectively taken a tough beating on many fronts.

Most NFTs are seeing major red days as holders scramble to liquidate their position for safer investments and more liquidity.

During these dark times, it also gives us time to step back and ponder:

Why are we passionate about crypto and NFTs in the first place?

This article is my answer to a simple question:

Why NFTs?

Financialisation of Culture and Community

For me, one of the most fascinating aspects of NFTs is the culture that it creates, and the community it brings together.

This can be transient; it can be artificially inflated by the euphoria of prices going up, but it is one that is truly unique to NFTs.

NFTs allow us to build this culture, financialise it, and spread it to greater heights.

A simple definition of Culture, by ChatGPT, goes like this:

When it comes to culture, NFTs check most of the boxes.

NFT projects, especially those among the digital profile picture category, typically represent a unique form of personality and community.

The NFT you hold and choose to display represents a set of beliefs and values. This distinct set of beliefs and values allows the NFT collection to attract members with similar beliefs.

They also provide holders with a strong sense of identity and belonging among their NFT communities.

For example, NFT project mfers, with their tagline ‘mfers do what they want’, shows an irreverent attitude towards all things big or small.

With NFTs, there is also the added financial incentive for holders to become ambassadors of the NFT projects they support.

This allows for ground-up, organic community building efforts, from the community itself.

From physical events, to online Twitter spaces and metaverse meetups, the possibilities are endless.

See the early days of goblintown and Nakamigos as examples.

It is little wonder why large non crypto-native brands are also exploring ways to enter the crypto space.

This capture of attention, engagement and culture from people all around the world is a unique feature that only NFTs can offer.

Innovative Solutions in the Real World

Besides these intangibles like culture and community, what others are often concerned about is the actual utility that NFT offers.

‘What can NFTs actually do?’

NFTs are often mocked as simply digital JPEGs, but they are actually so much more.

Digital art

NFTs offer all the benefits of owning an art piece, but with the added provenance and accessibility.

Another important feature that sets digital art apart from the other NFT use cases: It actually is all about the art (aesthetics) and the artist.

It is about collecting beauty, from culturally significant artists, and believing that others will have a similar view as yours in time to come.

The world of NFTs expands the world of art and collecting/investing.

Away from the small, exclusive circle of artists and art collectors, offering participants all over the world a chance to join in.

Utility, free cash flow, or any other way of valuing these NFTs are not necessary here. The art, in itself, is the value.

Ticketing

Another key use case for NFTs in the real world is ticketing.

It allows organisers to easily prove the authenticity of tickets, while allowing users to keep the NFTs as collectibles after the event.

Organisers can even use the NFT tickets as a way to keep track of this loyal fanbase, and share future rewards to keep them engaged. This can be in the form of surprise giveaways, airdrops, and other services.

For users, this also opens up the potential of tickets as digital collectibles - Gone are the days you needed to laminate your precious paper ticket as it fades over time.

You can now own the digital ticket as memorabilia, right in your digital wallet, forever marking a point in time and experience.

Memberships

NFT-based memberships are also an emerging and unique sector of the NFT market.

These NFTs serve as access keys to unlock incentives from holding these incentives. This can include access to member-only Discord channels, events, ideation and voting, etc.

There are many more novel use cases that NFTs can take on. NFT Now has a great summary here:

So, Why NFTs?

In essence, NFTs are a piece of technology that is standards-based, interoperable and made for internet-native ownership of intangible assets.

This piece of technology has uncovered so many possible unique use cases and solutions that keeps me very hopeful.

Don’t just take it from me, look at the potential adoption pathway Punk 6529 shares here:

More than anything, if we are going to live in a digitally native world in the future, NFTs seem like an essential component in our digital future.

These use cases are also just scratching the surface, there are so many more use cases that have yet to be uncovered and adopted by the masses.

I’m waiting in anticipation for that day to arrive.

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