What’s the ☕ on NFTs?

[Haamsaaveni (Hamsi) Kumar]

Hi to all Watson Daily readers! My name is Haamsaaveni and I wrote the Quick Bite article on NFTs. You can post your thoughts, comments and questions on the topic (even why you disagree with my liking for pineapple on 🍕) here on this forum.

• This topic was modified 3 years, 6 months ago by Haamsaaveni (Hamsi) Kumar.
• This topic was modified 3 years, 6 months ago by Haamsaaveni (Hamsi) Kumar.
• This topic was modified 3 years, 6 months ago by Haamsaaveni (Hamsi) Kumar.

[William Lowe]

A really fun read! For me, being able to drive around in a custom NFT car sounds really fun. However, I do think these NFTs will get out of hand and will begin to lose value. Their scarcity and novelty is, I would argue, making them so expensive at the moment. When other software engineers and coders begin to create their own, and in large quantities, prices will come down. Supply and demand!

[avlasova]

A great overview of NFTs! Coming from an art world perspective, subjective and sometimes inflated value has been assigned to items (or ideas of items) before and isn’t anything new (see Salvador Garau’s “invisible sculpture” being sold for €15k or the infamous banana taped to a wall for $120k). I believe the ownership of “things” has expanded beyond the material world a while ago into the conceptual realm.
My concern with NFTs is the level of trust/mistrust consumers have in the underlying technology, its security, and the uncertain regulatory landscape regarding copyright and ownership. I believe this, together with the NFT market’s inherent volatility at this formative stage, may put off some more risk-averse investors/collectors. It would be interesting to see whether NFTs start further inhabiting the truly common everyday life or stay in the collectors’ bubble.

[Alinakazmi]

Very good article! It is definitely an interesting topic and is an example of the shift towards a digital era. Why are retail investors being targeted apart from the potential for profits by NFT sales speculations? and how will other businesses apart from the sporting and gaming industry will be affected? Law firms can certainly help with drafting smart contracts in favour of the original creators.

[Haamsaaveni (Hamsi) Kumar]

Thank you Will and yes to the supply and demand argument and perhaps to the NFTs benefit if that will make regulators focus on other high-valued forms of tech-based assets.

[Haamsaaveni (Hamsi) Kumar]

Thank you Apolloniya! I agree that the valuation itself is not problematic but rather it is the use of NFTs as collaterals to other forms of instruments that is cause for concern. I agree that NFTs is unlikely to attract more conservative investors but if NFTs follow the same trend as Bitcoin and become more common amongst younger people (while still maintaining its high value), I might see NFTs becoming the new frontier in investments.

[Haamsaaveni (Hamsi) Kumar]

Thank you Alina!

I would suggest that some may be targeting retail investors because increasing number of players in the market = more $$ being transacted across the various platforms = creating a bigger pie for everyone to share a slice off.

Besides the industries you mentioned, we are seeing the music industry embracing NFTs whether it’s selling exclusive artwork like Grimes or Kings of Leon releasing their entire album as an NFT.

Another interesting NFT trend is that we are seeing domain names being sold on OpenSea where its blockchain domain enables censorship-resistant websites. This has attracted both investors and crypto traders (“sex.crypto” sold for 230 ETH/ around $90k). What’s even more interesting about these domains is that the websites on the domain can be “rented” out for profit (akin to real estate) and provides a chance for a passive return on investment. Definitely a space to watch and see if companies will get involved in this market.

It’s also noteworthy that you mentioned smart contracts because there’s news that some Magic Circle and US firms are working together to jointly create standards for legal smart contracts. NFTs are many things but certainly not boring!

[avlasova]

For sure! There are some ‘blended’ initiatives coming through as well, like blockchain-backed art funds, where shares themselves are NFTs, but the art being invested in is, for the lack of a better word, real, and these are quite popular with young investors, as you said!

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