NFTs, or non-fungible tokens, are hot property. Well, that’s if you believe the hype which is getting more and more difficult to deny.
The latest NFT craze is the Meka inspired by one of Japanese anime’s most famous characters, Gundam.
Driving the news
The Mekas form part of 8,888 NFTs which take their inspiration from Japanese anime classics. Before the Mekas were officially released this month, the entire collection had sold out. Sales have since totalled more than 20,000 ETH (about $70 million).
What is a non-fungible token?
Simply put, NFTs are collectibles, as this helpful Verge piece illustrates – and they can be anything from basketball playing cards, a piece of music, art, videos, GIFs – but they’re all digital, and each one is unique – hence the fungible part.
If you own an NFT, what you actually own is the property rights to the digital asset. Similar to cryptocurrencies, NFTs can be authenticated and traded through contracts, but NFTs are generally based on the Ethereum blockchain, which was developed after Bitcoin.
Why are people investing in NFTs?
The flippant answer is why not? In the same way that there is a market for collecting and trading sports cards, there is also one for digital assets. A 50-second video by Grimes sold for $390,000 and a video by the American designer Beeple sold for more than $6 million earlier this year.
Last month, Kings of Leon made history by becoming the first band to send a non-fungible token into space, when their NFT video was launched from Earth on one of Elon Musk’s rockets.
Are NFTs the future of art?
Hardly, but they do offer another way to collect and trade just about anything. You’re likely to see online trading platforms getting in on the NFT market. These past few months alone, NFT sales topped $10 billion.
Will you be hanging an NFT piece of art over your fireplace? I mean you could, but that’s all very analogue, and you’d have to print it out.