Blog

WTF are NFTs?

"NFTs are a replication of the dot-com bubble"

-Gary Vaynerchuk

Continue Reading

WTF are NFTs?

NFTs aren’t just another fad—they’re the future.

There’s a reason major players like Gary Vaynerchuk are getting started with NFTs. Put simply, it’s because they’re changing the game. And they’re going to be here for a long time.

But it’s not going to be an easy road. If the future is going to be built with NFTs—and we believe it will be—there are some major hurdles we need to overcome.

Let’s start with the basics. Where are NFTs now?

The NFT landscape

NFTs aren’t mainstream for a simple reason: they’re too new.

Just like the television, Internet, and iPad did in their day, NFTs are finding their true fans alongside a hefty dose of true haters. It’s how every great tech starts, especially one as groundbreaking as NFTs.

The metaverse isn’t mainstream yet and Web3 is still a novelty. Instead of looking at the real potential and power behind the idea of non-fungible tokens, most people just see NFTs as a social media flex.

Collectors (with money) are flashing their CryptoPunks and Bored Apes Yacht Club tokens to impress, but the real value lies elsewhere.

The internet’s collection curse

Humans like collecting things. Pharaohs were buried with their treasure and today’s art collectors spend millions on an original Picasso.

But collecting only works in a world where copies are inferior to the original. A Picasso print wasn’t the same as the real thing, which is what makes it worth millions.

But the digital world brought with it a blessing and a curse: perfect copying.

In a keystroke, any digital product, from a JPG to an MP3, can be copied—identically. The replica has no discernable difference when compared to the original.

We created a world where any file could be copied an infinite number of times, each one as flawless as the last. And the concept of an “original copy” became nearly meaningless in the digital world.

That’s where NFTs come in.

The metaverse: restoring meaning to digital collectibles

Since the beginning of recorded history, humanity has valued originality. But that very concept has been undermined in our generation with the creation of lossless systems. If the future is digital, how can we preserve originality?

And the failure of various digital right management systems has shown it’s not as simple a problem as it may first appear.

NFTs, of course, are the solution. They retain the benefits of the digital world—freedom from physical storage, protection from damage, lasting durability—and bring the benefits of first-generation collection.

NFTs mean ownership of goods that can last as long as we’re using digital systems. The real value of NFTs isn’t in social media bragging. It’s in long-term collection for collectible receipts.

Imagine having tickets to the first Rolling Stones concert, an authentic experience-based collectible that will only increase as time goes on. In a world where tickets are just QR codes, NFTs make collecting cool again.

The path forward is clear enough. But there are still a few roadblocks to overcome.

Problems with the NFT world today

The potential of NFTs is getting clouded by poor implementations.

The dream of Web3 is a new internet that’s accessible for everyone. But it’s not going to happen in a world where high fees make the barrier of entry into the NFT space too high.

Ethereum’s gas fees are the biggest obstacle to the potential of NFTs. When it costs tens or hundreds of dollars and takes hours to process a transaction, we’re back to where we started—an exclusive club of elite collectors.

Right now, there’s a unique opportunity for Solana to become the dominant market for NFTs. There aren’t any gas fees, and that’s where creators would like to mint.

But Solana has its own problems. In January 2022 alone, the blockchain platform had six outages of eight hours or more. Choosing between an unreliable network and one with sky-high fees isn’t a fair decision for anyone.

What does the future look like for NFTs?

NFTs are here to stay.

They’ve created a third generation of collectibles that’s solved the problems of the digital world. An architecture for a new collectible landscape will be a key component of the now-ambiguous Web3 and metaverse.

The problems facing the technology right now are serious, to be sure, but they’re not permanent. There’s a chance for a more affordable, scalable, and reliable blockchain to dominate the NFT space.

And when that time comes, we’ll be ready.