Why 2021 Will be the Year of Non-Fungible Tokens (NFTs)

2017 ICOs, 2018 Smart Contracts, 2019 Stablecoins, and 2020 DeFI. It’s Time to Pass On the Torch: Non-Fungible Tokens in 2021.

Visual curtosy of Terra Virtua, one of the world’s first immersive digital collectible platforms.

It’s no secret that people like collecting things. The types of items you collect depend on your particular interests and passions or whether those collectibles resonate with you on an emotional level. Think of how you might have collected Pokémon cards, stamps, video games, books, posters, maybe even marbles or bugs as a child. Your collection may look pretty different as an adult. Perhaps you now collect fashionable bags and shoes, tech gadgets, antiques or artwork. Or maybe you still collect the same things you did as a child.

But what if your physical collection can be expanded to a digital and virtual world? What if UFC fans can collect and own their favorite Conor McGregor (or other fighter) moments? For Nike fans, how about traversing virtual gaming worlds while donning your favorite kicks? What if you can now own that pet dragon you’ve always secretly wanted in a virtual home? For the art collectors out there, imagine having a virtual gallery of digital artwork that you can fit in your pocket and take around with you to show your friends and family. How about owning your favorite celebrity’s memorabilia and behind the scenes rarities? Well, you might not need to imagine for much longer because the rise of non-fungible tokens (NFTs) in the crypto world are going to make your wildest imaginings and dreams real — virtually real. And here’s a heads-up to Star Trek fans, you may soon be able to own William Shatner’s tokenized memories in the form of trading cards, one of which will be a poignant image of Shatner hugging longtime friend Leonard Nimoy.

Star Trek fans may soon be able to own William Shatner’s tokenized memories in the form of trading cards.

NFTs have been the source of whispers across the globe over the past few months and are a strong contender to steal the spotlight in the 2021 crypto world. The relatively short history of the crypto world has been characterized by waves of trends: the 2017 ICO boom, 2017–18 smart contract platform era, 2018–19 stablecoin era, and 2020 DeFi craze. Although DeFi has been the focus for most of 2020, NFTs have steadily been gaining traction in recent months. Ilya Abugov, project manager at DappRadar, recently told Cointelegraph: “There is more hype around NFTs right now. To some extent it’s an extension of the DeFi excitement.

The relatively short history of the crypto world has been characterized by waves of trends: the 2017 ICO boom, 2017–18 smart contract platform era, 2018–19 stablecoin era, and 2020 DeFi craze.

I. Wait a Minute. What Makes a Non-Fungible Token?

NFTs are tokenized versions of a non-fungible asset like artwork, real estate or collectibles. Non-fungible assets possess properties and individual characteristics that make them unique and valuable.

Looking at the advent of cryptocurrency, the crypto world has been dominated by fungible currencies over the past decade. “Fungibility” is a complex idea with a simple premise. It speaks to the interchangeability of an asset, where two items are fungible if exchanging them is meaningless. For example, if two people exchange a dollar note with each other, there is no difference in value or meaning in the exchange. The exchange would only become non-fungible if either cared about the serial number of the dollar note and where it was created.

Non-fungible vs fungible (Source: ArzDigital)

In another sense, NFTs are everything in the world that is unique and rare. Remember the above example of a favorite Conor McGregor moment? There’ll likely never be an exact replica or repeat of that moment, which is what makes it unique and valuable. By tokenizing that spectacular knockout and writing its unique properties into a smart contract, fans can own or trade their favorite moments. NFTs can be used to represent a variety of assets such as virtual collectibles, in-game items, virtual assets, digital artwork, real estate and more. But since each token is unique, they cannot be exchanged with the same ease or interchangeability as fungible assets can. As an example, you can’t exchange a very rare, old and valuable car with a common car. Decrypt explains that NFTs:

“Cannot be swapped like for like, as no two are alike.” — Decrypt

Another reason NFTs are different from cryptocurrencies, which are fungible, is because they are indivisible and you can’t trade a fraction of them like you can with Bitcoin. For example, you can’t cut out a fraction of a concert ticket and send it to a friend. Neither of you will get past security with fractions of a ticket.

Unlike Bitcoin, which has a supply of 21 million identical coins, NFTs have individual characteristics that set them apart. (Source: Cointelegraph)

II. The Rise of NFTs: Why Are They Getting Attention Now?

Net NFT market cap evolution 2017–2020. (Source: Cointelegraph)

NFTs are not a new concept and the first NFT-like token was the introduction of Bitcoin 2.X (aka colored coins) in 2012. In terms of market capitalization, the NFT industry grew 17% in 2019 and was forecasted to grow 50% by the end of 2020. This market capitalization is fascinating as it represents the creation of more than $200 million in gross value from nothing in less than two years. According to NFT data resource NonFungible.com, NFT sales activity has increased dramatically since September 2020 and has remained higher than previous months of the year. NFT sales came close to $1 million in the first week of September 2020 as the blockchain-based fantasy soccer card game Sorare reached over $221,000 in sales. This momentum shows no sign of slowing down as $2 million worth of NFTs were exchanged in the first week of December 2020. According to Coingecko, the NFT market capitalization has exceeded its 2020 forecast and reached over $550 million.

An overview of total USD transferred through NFT project history between 8 Dec 2019–8 Dec 2020. Visualizes the recent increase of NFTs transferred in USD, especially when comparing the first three and last three months of the year. (Source: NonFungible.com)

One of the first NFT projects that really exploded and gained a lot of attention was the CryptoKitties boom in November 2017. CryptoKitties is a game built on the Ethereum blockchain that allows users to collect, breed and exchange virtual cats. The game is known for slowing down the Ethereum network back in 2017 due to the high amount of activity it stirred up and exemplifies a blockchain use case geared towards entertainment and recreation rather than currencies. These virtual cats are apparently appealing enough to move millions of dollars and the rarer cats are valued at hundreds of dollars each.

Dragon, the most expensive CryptoKitty so far who sold for a whopping 600 ETH (approximately $170,000 at the time)

Dapper Labs, the company behind CryptoKitties, had the simple goal of introducing a billion people to blockchain. Co-founder Mik Naayem explains that they decided to target entertainment and the gaming space as it’s an “easier way to introduce folks to decentralization” and “gamers are the perfect target market as they already understand virtual currencies and virtual worlds.” He goes on to state:

When we created CryptoKitties, what we were trying to do was test whether we could get people who’ve never used a blockchain before to use it… and understand why it’s different and why it’s valuable.

They well and truly succeeded since CryptoKitties taught new users about blockchain and introduced the concept of NFTs to hundreds of thousands of people.

After the CryptoKitties boom at the end of 2017, the NFT marketplace remained rather stagnant throughout 2018 and 2019. NonFungible’s annual report pegged 2019 as the year of stabilization for the NFT ecosystem as it entered a “phase of consolidation and stabilization” following the ICO frenzy. The report identifies how most NFT projects had a poor retention rate in the past two years, where the vast majority in 2019 were used for three months or less. It goes on to reveal that only a little over 10% of newly created NFT assets circulated throughout the year, a rate similar to 2018.

The dollar value of NFTs transferred trebled to reach highs of $159 million in 2018, falling to $152 million in 2019. (Source: Cointelegraph)

Despite the slowdown after the initial 2017 excitement, new developments continuously emerge in the NFT space and several activities and projects have garnered attention in recent months especially. Projects have reached record-breaking sales, such as the recent Bitcoin-code-inspired artwork that sold for over $130,000 or the blockchain-based trading card of Paris Saint-Germain forward Kylian Mbappé that sold for $66,850. Although the CryptoKitty Dragon still holds the record of the priciest non-fungible token ever sold, two of the most expensive NFTs sold in 2019 include the one-of-a-kind digital sports car F1 Delta Time Apex Race Car “1–1–1” (415.9 ETH, $113,124) and a plot of land named The Secret of Satoshi’s Tea Garden in the virtual reality platform Decentraland (1.3M MANA, $80,663). Even celebrities have started engaging with NFTs, like when Paris Hilton auctioned off a cryptograph drawing of her pet cat Munchkin for 40 ETH (worth $17,000 at the time) in August to raise money for charities.

With all the noise NFTs have been making, major companies and big brands have taken an interest and gotten involved in the industry. Several of the biggest brands on the planet are now developing blockchain based games, collectibles and virtual worlds. These include National Basketball Association (NBA), National Football League (NFL), Ultimate Fighting Championship (UFC), Formula 1, Louis Vuitton, Samsung and Nike to name a few. The involvement of these big brands is a major move towards mainstream adoption of NFTs as new users are introduced to the concept of NFTs through channels that they’re passionate about and already familiar with.

Several of the biggest brands on the planet are now developing blockchain based games, collectibles and virtual worlds. These include National Basketball Association (NBA), National Football League (NFL), Ultimate Fighting Championship (UFC), Formula 1, Louis Vuitton, Samsung and Nike to name a few.

III. How Do NFTs Work? Let’s Get a Bit Geeky

The unique information of an NFT is stored in its smart contract and recorded on the token’s blockchain. Majority of NFTs are ERC-721 tokens that use ethereum’s protocols and blockchain. The main characteristic of ERC-721 tokens is that when a token is created, only one of it exists. Users can create their own ERC-721 tokens by writing a piece of code in a smart contract that follows a basic template and then adding unique details about the token. These unique details can include the name of the owner, rich metadata or secure file links.

Enjin co-founder and CTO, Witek Radomski, developed ERC-1155. The ERC-1155 is a new standard that allows a single smart contract to govern an infinite number of tokens. Unlike the ERC-721 token standard, which only produces NFTs and forces developers to deploy a new smart contract for each new token, the ERC-1155 token standard allows developers to deploy a single smart contract and then mint new tokens (fungible and non-fungible) in seconds for an infinite number of times. ERC-1155 contracts now power over 40 games as a contract made for a game has the flexibility to contain a wide variety of items, from weapons and armor to health potions and superpowers. However, the ERC-1155 is not just for gaming and can be applied to a wide range of industries.

The ERC721-standard versus ERC-1155.

NFTs are also supported by blockchains other than Ethereum including TRON Foundation, eosio, NEO LastSamurai, and Dapper Labs’ Flow blockchain. Unlike Bitcoin and other fungible cryptocurrencies that can be traded on standard cryptocurrency exchanges, NFTs are bought and sold on open marketplaces that connect buyers and sellers, such as OpenSea or Decentraland’s LAND marketplace.

IV. Characteristics of NFTs — This Is What Makes Them Appealing

Three desirable characteristics of NFTs are that they can prove authenticity, provide ownership and are transferable.

1. Authenticity

The standardization of NFTs and the detailed attributes of their smart contracts make each of them uniquely identifiable and authentic. Users know that there is only one of each NFT in existence, so they cannot be duplicated or copied and there’s no chance you’ll end up with a fraudulent item. The transparency of blockchain technology also means that it’s possible to verify and prove authenticity.

Counterfeiting and fraud is a big problem for many industries such as art or luxury brands, but Cointelegraph points out that “The blockchains powering NFTs clamp down on counterfeiting — and give buyers confidence that they’ll get what they pay for.Coindesk reports that luxury brand conglomerate LVMH, owner of the iconic Louis Vuitton label, is riding the NFT wave and is preparing to launch a blockchain to prove the authenticity of their luxury goods. The goal is for products to be given NFTs so authenticity can be verified. It will also be possible to trace an individual handbag’s lifecycle journey from alligator farm to the store it was sold in and its subsequent multiple owners who previously purchased and sold it.

Luxury brand conglomerate LVMH is riding the NFT wave and is preparing to launch a blockchain to prove the authenticity of their luxury goods.

2. Ownership

Blockchain technology enables people to truly start owning what is theirs. It’s worth noting here that NFTs can only be transacted and transferred by the owner(s) of the asset due to their smart contracts and associated rights. This means that even the issuer of the NFT can’t replicate or transfer the NFT without its owner’s permission.

Gamers have traded virtual currencies and assets for years, from Fortnite’s cosmetic character skins to World of Warcraft’s gold. But in a traditional game, you don’t truly own anything in the virtual world because its economy exists exclusively in a closed marketplace. You might have spent $60 to own the license of the program, played it for a month, beat the game and then put it away with nothing else to show for it. In other words, you can’t exchange an in-game currency or item with fiat currencies and nor can you bring it with you to another game because you don’t truly own it. But in the world of blockchain games, you own all the tokenized in-game assets (in the form of NFTs) in your wallet and can trade, battle, fight or race with them across multiple games. You own and control all these assets, whether it’s an enchanted sword, skins or currency. In the Futuristic Conference 2020’s panel on The Future of Gaming & Non-Fungible Tokens, Dr. @Jesse Reich (CEO Splinterlands) elaborates on how owning your assets is a one-way valve: “The second you start owning your sword and your armor and your characters and something custom about them, the idea that you’ll then go and play this other game and spend hundreds or thousands of dollars and not own any of those things will cease to be appealing.” Dapper Lab’s Naayem echoes this with the observation that once users have experienced uniqueness, scarcity and ownership in a virtual world, handing over cash in ordinary games completely loses its appeal.

3. Transferrable

Since NFTs are decentralized, there’s no requirement for a central issuing agency and they’re a lot easier to move around. It allows users to dive into permissionless peer-to-peer interaction, trading and specialist marketplaces without meddlesome third-parties who could slow down or complicate the process.

Following the gaming example above, NFTs solve the issue of exclusivity in traditional games as assets can easily be transferred to use between different blockchain games. Since the assets that you’ve built or bought in one game are owned by you rather than the gaming company, they’re transferable between different worlds and can be taken from one game to another. They’re also transferrable in the sense that these tokens enable millions of people to have ready access to them and they can be traded for other cryptocurrencies.

V. Why Are NFTs So Exciting?

NFTs are creating opportunities for all kinds of creators (visual arts, game designers, musicians, etc.) and unlocking new revenue streams. Part of what makes them so exciting is the variety of assets they can represent: virtual collectibles, game items, digital artwork, event tickets, real estate, identity documents, certifications, and more. WAX Co-Founder, William E. Quigley, made the bold statement that:

NFTs will stand side by side with movies, music, and video games as a distinct entertainment format. Every consumer product that cannot be eaten will become an NFT.” — William E. Quiqley (WAX)

NFTs definitely open a wide range of possibilities for real-world and virtual assets thanks to easy transfer and proof of ownership.

The current crypto market revolves heavily around bitcoin and cryptocurrency trading and mining. But to encourage mass adoption, it needs to move away from this area. NFTs are fueling this as they have the capacity to capture the hearts and minds of individuals and onboard them into the blockchain space in a way that fungible currencies haven’t been able to. Returning to CryptoKitties as an example, Dapper Labs’ Naayem revealed that “a little over 40% of our audience had never owned a cryptocurrency before”. By introducing new users to the crypto world through channels of entertainment and recreation, it’s easier for beginners to access and understand the value that blockchain technology and decentralization can provide to them. Ilya Abugov, project manager at Dapp Radar, told Cointelegraph:

Art and collectibles are the easiest use cases for retail users to understand, and so it may be where the hype concentrates for some time. If we see an exciting game and more artists onboard into the ecosystem the trend may get more mainstream traction. However, there are more use cases that get unlocked with NFTs from asset tokenization to documentation.” — Ilya Abugov (Dapp Radar)

VI. Current NFT Use Cases

Current NFT use cases are concentrated in the main categories of collectibles, art, gaming and virtual worlds. But other categories like sports, fashion and real-world assets are steadily developing. An interesting twitter thread by virtual land investor @Dclblogger lists about 25 industries that the NFT ecosystem is disrupting.

Collecting. Reinvented. Terra Virtua is one of the world’s first immersive digital collectible platforms, with partnerships with some of the biggest names in the movie industry, including move collectible merchandise for Topgun, The Godfather series, Pacific Rim, Sunset Boulevard, and Lost in Space. It’s also working together with Paramount Pictures.

1. Collectibles

Collectibles are currently one of the most popular applications of NFTs in terms of sales volume, with around 23.6% of the past month’s sales coming from collectible-related projects. CryptoPunks, launched in June 2017, are one of the first collectible NFTs on Ethereum and have sold for thousands of dollars. They were actually developed prior to the introduction of ERC-721 and a wrapper had to be introduced so they could be traded on exchanges like OpenSea. Since their launch in November 2017, CryptoKitties remain one of the most notorious examples of collectibles and sales for the virtual cats have reached an all-time volume of over $38 million.

This category continues to develop and expand as NFT technology is being leveraged to create tokenized versions of star athletes and celebrities for fans to collect. The fantasy soccer game Sorare allows players to collect “limited edition digital collectibles” of their favorite athletes from 100 football clubs. Members of the NFL and NBA expressed interest in working with NFT technology during the NFT NYC back in February 2020. Since then, in partnership with the NBA, CryptoKitties creators Dapper Labs have launched token-powered NBA TopShot. In conversation with Cointelegraph, Dapper Labs’ head of partnerships and marketing, Caty Tedman, stated that “the product is meant to give fans a piece of ownership over the action that happens on court.” By tapping into passionate fan bases, NFT collectibles have demonstrated their potential and power to bring these communities to blockchain. NFTs are also dragging more traditional collector items into blockchain technology, such as trading cards, coins and stamps (e.g. crypto stamps).

Sorare allows players to collect “limited edition digital collectibles” of their favorite athletes from 100 football clubs.

The digital collectible ecosystem Terra Virtua stands at the forefront of the NFT collectibles movement. The platform aims to provide users with a “deep sensory experience” by taking digital collectibles into a multiplatform VR and AR world.

Terra Virtua users can put their digital collectibles to action in an AR setting.

Terra Virtua has launched a collection of character-based 3D animated creatures called ‘vFlects’ along with licensed collectibles in 2D and 3D from The Godfather, Top Gun, Sunset Boulevard and Lost in Space. They offer a marketplace for an interactive range of unique and licensed digital collectibles, but have also launched an ecosystem through their art gallery app and Terra Virtua Fancave to create a cross platform journey. The art gallery app allows owners to store, display, interact with and show off their collection of unique digital artworks. The Terra Virtua Fancave is a personalized and customizable VR environment where users can display their collectibles. Gary Bracey (CEO at Terra Virtua) says, “The key mission of Terra Virtua is to bring NFTs to the mass-market. The videogame experience of the core team gives us a strong focus on UX and UI and by making the process both frictionless and compelling we hope to bring the world of interactive Digital Collectibles to the mainstream.” The sensory element and cross platform capabilities that Terra Virtua provides its users pushes NFTs beyond their current label as products into truly engaging and interactive experiences.

Terra Virtua has created a digital fancave for fans to store their digital collectibles.
Gods Unchained is one of several popular blockchain games.

2. Gaming

As mentioned earlier, gamers make the perfect target market for NFTs since they’re already familiar with the concept of virtual worlds and currencies. NFTs are booming within the gaming industry as they allow in-game items to be tokenized and easily transferred or exchanged with peer-to-peer trading and marketplaces. This is quite unlike traditional games that prohibit the sale or transfer of in-game items like rare weapons and skins. NFTs also make the gaming experience more tangible and rewarding as players have true ownership over their digital assets. They are also creating a new economy as players now have the potential to earn money by building and developing their in-game assets.

The crux of blockchain’s potential here is the theory that player loyalty will increase when they have more skin in the game: when their digital assets can be transferred between games or platforms, or traded on open markets, they will invest more of their hard-earned cash.” — Cointelegraph

A Galaxy Interactive pamphlet explains that as virtual goods earn the same status as their physical counterparts, “The value we create inside of our virtual worlds will become indistinguishable from the value we’ve historically created outside of them.” NFT incorporation into the gaming world is also encouraging the development of an engaging and interactive community as players begin to build an inherent community aspect through peer-to-peer trading.

Ranking of top ten blockchain games this past week according to NonFungible.com.

Three popular blockchain games that have really taken off are Axie Infinity, Gods Unchained and My Crypto Heroes. Axie Infinity is a digital pet community centered around collecting, training, raising and battling fantasy creatures called Axie. The game is built on the Ethereum blockchain and is the first game on the blockchain to feature animated characters and rich, immersive gameplay. Gods Unchained is a digital collectible card game where cards are issued as NFTs and players can own and trade them with the same level of ownership as physical cards. My Crypto Heroes is a Japanese multiplayer role-playing battle game that issues heroes and in-game items as tokens on the Ethereum blockchain, where players can level up historical heroes through quests and tournaments.

Games need to be fun and enjoyable to be successful, but another crucial aspect that has a significant role in the mass adoption of NFT games is Play2Earn. The fact that people can earn something in exchange for playing a game is attractive for many, especially people in developing countries where playing Axie Infinity could earn as much as a salary. CryptoPick is another example of a game where users get rewarded for their participation. Players can playfully learn about crypto without taking any financial risks and, more importantly, earn their first crypto (ETH) and NFTs. Owning their first Crypto & NFTs means they will learn about having a wallet, making a transaction, and much more, resulting in gaming becoming an appealing way for many to get onboarded in the Crypto sphere.

Some of the prizes that players can purchase with the tokens they earn on the Cryptopick platform.
Rarible is a community-driven NFT marketplace for virtually created artwork.

3. Art

One of the biggest challenges for digital artists is protecting their creations against copyright infringement, but NFTs are a solution as they provide proof of ownership, authenticity and eliminate issues of counterfeiting and fraud. An article from Coindesk notes that many artists have turned to NFTs and online showrooms as museums and galleries are forced to close in the face of COVID-19, and “Just as Bitcoin paved the way for trustless, peer-to-peer transactions by creating a shared ledger of events, crypto art […] has provenance built in.” The first record for highest-valued NFT art auction sale occurred in July, when “Picasso’s Bull” was purchased for over $55,000. Other subsequent records include “Right Place & Right Time” (sold for over $100,000) and “Portraits of a Mind” (sold for over $130,000). Cointelegraph points out that “These projects can even improve and streamline artists’ revenue by connecting them directly to consumers through blockchain-based payment and exchange solutions.

Just as Bitcoin paved the way for trustless, peer-to-peer transactions by creating a shared ledger of events, crypto art […] has provenance built in.” — Coindesk

Examples of platforms and marketplaces for digital artwork include SuperRare, MakersPlace and Rarible. These platforms and marketplaces operate similarly to one another and allow users to easily create original digital artworks and sell it on their marketplace. Rarible is a particularly interesting example as it brings together some of the more interesting DeFi trends of 2020 by combining digital collectibles with yield farming and liquidity mining. They’ve accomplished this by issuing their governance token $RARI. This adoption strategy has been one of the reasons for the renewed interest in NFTs during the last few months of 2020. Users are rewarded and incentivized with Rarible’s governance token ($RARI) when they sell and trade their NFTs on the platform. As such, Rarible is a community-governed marketplace aimed at becoming a fully Decentralized Autonomous Organization (DAO) and the $RARI token is the first step in that direction. Besides Rarible, many other platforms and NFT marketplaces have also started issuing and distributing governance tokens: The Sandbox ($SAND), Somnium Space ($CUBES), Decentraland ($MANA), a full list can be found on Coingecko.

Somnium is a virtual reality world where one can trade own and trade art, among many things.
Makersplace is another NFT based marketplace for rare virtual artworks.
Decentraland is one of the virtual worlds based on blockchain and NFTs.

4. Virtual worlds

Another use case for NFTs is virtual worlds. Decentralized virtual reality platforms like Decentraland, The Sandbox and Cryptovoxels allow users to create, own and monetize parcels of virtual land and other in-game NFT items. LAND in Decentraland is permanently owned by the community and gives players full control over their creations and virtual assets. Considering Gen Z’s familiarity with virtual worlds and how their concept of valuable assets differs from older generations, assets in virtual worlds give them choice and flexibility that aligns with their values: “So perhaps our children’s generation won’t own the roof over their heads, but they’ll own a wealth of digital assets instead.

The Sandbox is another virtual world based on blockchain and NFTs.

5. Real-world assets and documentation

It’s possible to tokenize real-world assets like property and shares or documentation such as qualifications, licenses, medical histories, birth and death certificates. However, developments in this category are still at an early stage and its use cases are relatively rare. But as the crypto world and NFTs continue to develop and expand, who’s to say you won’t one day (maybe soon) be able to own a plot of vineyard in another country thousands of miles away. For all we know, your digital wallet may soon contain proof of every certificate, license and asset you own.

VII. What Lies Ahead For NFTs?

The possibilities and potential of NFTs are endless, and recent record-breaking sales are helping to push NFT technology forward. One of the current barriers to its mass adoption lie in the lack of widespread education of blockchain technology and the crypto world. “If you educate people, allow them to get a taste of it, experience it, then they’re not intimidated by it,” says John G Fields, creator of Grow Your Base.

Part of this education includes security, as new users who enter the blockchain space need to understand how to safeguard their wallets and private keys so their valuable digital assets are not vulnerable to hackers. Because of their rarity and scarcity, many digital assets, collectibles and investments are very valuable and losing them would undoubtedly cause some heartache. Developers and creators of digital assets also need to ensure that solid copyrighting and licensing are written into smart contracts in order to protect their value. Most crypto wallets currently available are considerably complex and difficult for new users and mainstream beginners to onboard themselves. But wallets that aim to improve this are continuously being developed and released, such as the Pillar wallet, Coinbase wallet, Enjin wallet or WAX Cloud Wallet (WCW) to name a few. NGRAVE ZERO is another to keep your eye on as it’s designed to be the “coldest” and most secure crypto wallet that is also incredibly user-friendly and seamless to use, in essence providing full peace of mind when interacting with your NFTs. Besides providing a secure and protected environment for users to store and trade their virtual assets, ZERO’s high-quality touch screen also provides the interesting potential prospect of enabling owners to showcase their virtual collectibles and assets to others from a small and portable device.

Another aspect of educating the masses needs to consider how NFTs and blockchain technology is still very geeky, nerdy and technical. Further simplification will be necessary so it becomes easy to use and accessible for those who know nothing about blockchain. Dr. Jesse Reich (CEO Splinterlands) mentions in The Future of Gaming & Non-Fungible Tokens panel how the trouble “lies in making blockchain invisible to a new user and accessible to an advanced user.” Although projects like CryptoKitties have successfully introduced new users to blockchain, and the development and rise of NFT use cases in recent months have fueled its adoption, there’s still a long way to go. The NFT excitement is currently concentrated in the niche areas of gaming, art and collectibles, but new projects that continuously emerge are slowly but surely expanding NFTs to other aspects of our physical lives. As an increasing number of big brands (like Nike who has patented shoes as NFTs called CryptoKicks that allow users to ‘breed’ different shoes to create a custom sneaker) join the fray, we’ll see how NFTs grow to become transferable between different worlds — virtual and physical alike. As Yat Siu (CEO of Animoca Brands) aptly puts it:

If suddenly millions of people end up owning Nike virtual shoes, how many game companies out there might actually say, let’s make use of those Nike shoes inside our virtual games?” — Yat Siu, CEO Animoca Brands

As knowledge of the potential and value that NFTs can offer becomes more widespread, an increasing number of big brands, major investors, and venture capital companies are taking notice and getting involved. Morgan Creek digital co-founders Anthony Pompliano and Jason Williams have reportedly made a “big bet” on digital art NFTs surpassing the physical art market.

Indie blockchain game developers have also begun to successfully attract venture capital due to their incredibly long product life cycles and ability to offer changed monetization models, which make them ideal investments. New governance tokens in the NFT sector are also sparking interest, much like they did for DeFi, and there’s no telling what exciting new ways NFTs and DeFi will find to intermingle. However, the road ahead for NFTs is not without challenges as they may face regulatory hurdles in the future. Regardless, the crypto space is still very young and needs to keep growing as an entire community with the production of many more projects, even if those projects come, fail, and go.

Meanwhile…

About the author: Ruben Merre is a repeat tech entrepreneur, polyglot, life-long learner and founder and CEO of NGRAVE, the digital asset security company behind “ZERO”, the most secure cryptocurrency wallet in the world. Since 2018, Ruben and his team have partnered up with the top tier in nanotechnology, cryptography and hardware security, as well as thought leaders such as Jean-Jacques Quisquater, famous cryptography professor and second reference of the bitcoin paper. The result: a true end-to-end solution for managing digital assets, at maximum security (EAL7, highest security certification in the world), and an intuitive user interaction.

Like what you read? Then don’t forget to clap! Also, feel free to take a look at my other articles, and don’t forget to visit NGRAVE!

Co-Founder & CEO NGRAVE | www.ngrave.io | Protecting Your Private Keys From A — Z. The Coldest Wallet.

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