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The NFT Craze: Would the Madness Fade Away?

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Business Insider

My friend Belemo or like @deraaa would say, our mentor @belemo got an NFT (Non-Fungible Token) recently and was excited about it. It immediately got me thinking, what's the fuzz about this "NFT" and why do people who are more aware than I am about crypto-related affairs rave about it? As usual, my inquisitiveness kicked in and then I went on a journey to find out all I can about the infamous NFT and decided to share my findings.

According to Wikipedia, an NFT is a unit of data stored on a digital ledger, called a blockchain, which can be sold and traded. The NFT can be associated with a particular digital or physical asset (such as a file or a physical object) and a license to use the asset for a specified purpose. NFTs (and the associated license to use, copy or display the underlying asset) can be traded and sold on digital markets. These digital or physical assets include items such as photos, videos and other types of digital files as unique items (analogous to a certificate of authenticity).

Their growing popularity is sometimes described as beyond baffling but the explosive growth shows no sign of dwindling. At the moments lots of celebrities are having a bite at the cherry and according to The Economic Times, Bollywood superstars such as Amitabh Bachan and Salman Khan are planning to Launch NFT's soon. While Bachchan's NFTs will include autographed posters of his movies, Khan has been building excitement on his Twitter account by telling his 43 million followers about the planned NFT launch. Amitabh Bachan NFT

Sales of NFT's have since August 2021 been on the rise according to Fashionunited.com and speculators are rushing in with glee. This recent soar in demand is believed to be favoured by confinements (physical art was no longer accessible) and justified by the growing interest of the art world, sports and media. Marvel has put up for sale several anthology comics, a collector spent 600,000 dollars to buy the jpeg of an old stone, unseen photos of young Kobe Bryant have been auctioned using this process, a work by artist Beeple was sold as an NFT for 69.3 million dollars at Christie’s last March. The most unexpected examples abound. Source

It is important to point out that an NFT is a digital item that, thanks to blockchain technology is made non-fungible (unique and non-exchangeable). This means that whatever art form bought takes an original and authentic character since its ownership can be verified and certified. This seems to be useful in fields where luxury and exclusivity are highly sought like in the fashion industry.

Source

The only negative this technology possesses is that it consumes a lot of electricity. The carbon footprint of NFTs is therefore considerable. In short: a technology full of promises but also of paradoxes.

Sources

Republicworld.com

Fashionunited.com

The Economic Times

Wikipedia