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Viewpoint: NFT is changing the structure of the Web3 digital authoring economy

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Unlike traditional royalty systems, NFT is a pure digital native.

Original source: ViaBTC Capital Insight

NFT's popularity soared in 2021, reaching $2.5 billion in first-half sales. Pop singer & NBSP; Celebrities ranging from Katy Perry to rapper Jay-Z, as well as traditional institutions such as the NBA and Louis Vuitton, have all made inroad into the NFT market, generating an eye-popping $5.591 billion in sales in the second half of the year. Meta universe land hot with traditional tide brand, sports brand (Adidas, Nick, Disney), basketball star Curry, Jordan and so on to establish their own NFT online brand or meta universe. Looking back, NFT has grown and matured. In the past 12 months, the NFT landscape has evolved from a small ecosystem with hundreds of millions of dollars in sales to a multi-chain ecosystem with billions of dollars in capital:

In 2017, with the launch of OpenSea and SuperRare among others, early NFT struggled in a market largely dominated by Ethereum.

In 2020, OpenSea averaged $1 million in monthly sales, and sales of NFT art and collectibles increased towards the end of the first COVID-19 (now seen as the kinkind-fire for growth in the NFT market).

In December 2020, NBA Top Shots and early Ethereum card games like Axie Infinity and Sorare began slowly gathering new users.

In August 2021, multi-chain NFT boom, NFT market transactions again peak. NFT secondary sales are over $4.5 billion, and the actual sales could be much higher considering art sales and NFTS that are not tracked by Cryptoslam, such as digital land.

Source: CryptoSlam

What is NFTs?

A non-homogeneous token (NFT) is a unique and non-interchangeable unit of data stored on a blockchain, a form of digital ledger, associated with replicable digital files such as photos, video and audio. NFTs uses digital ledgers to provide a common certificate of authenticity or proof of ownership, but does not restrict the sharing or copying of underlying digital files. NFT differs from blockchain cryptocurrencies such as Bitcoin in its lack of interchangeability (fungibility).

NFT (Non-Fungible Token) is a unique and non-interchangeable unit of data stored on a blockchain, a form of digital ledger. NFTs can be associated with reproducible digital files such as photos, videos, and audio. NFTs use a digital ledger to provide a public certificate of authenticity or proof of ownership, but do not restrict the sharing or copying of the underlying digital files. The lack of interchangeability (fungibility) distinguishes NFTs from blockchain cryptocurrencies, such as Bitcoin.

NFTs change the creator revenue business model

NFT royalties can easily be up to 10 times higher than a traditional artist monetization system, and almost every artist's efforts are focused on how NFT is distributed. The reason behind it is that NFT brings about a new paradigm change in ownership and access to the Internet economy, getting rid of the original business model of royalties and creator income.

In the past, the Internet creators rely on mental and inspiration work (text, video, pictures, audio, images, or other creative media), on the one hand, rely on copyright, DMCA, DRM and relief watermark, such as the traditional way to forcibly spread on the Internet, on the other hand the work value is only rely on the traditional copyright fee is divided into economic compensation and commercial purposes. There is no doubt about the drawbacks of communication. The Internet is free and open without hindrance, while the traditional way of copyright printing is more like an antique, which limits the online barrier-free communication of works. In terms of value, creators who rely solely on paid subscriptions for copyright, who are locked into Internet platforms (where most of the revenue is monopolized by advertising revenue), or who are easy to copy are severely compromised. It can be said that the boundary between ownership and use right of traditional Internet economy is not clear, economic ownership is abused by Internet platforms and pirates, but the use right cannot be spread on a large scale because of copyright and ownership restrictions.

NFT was born of and for the Internet. Unlike traditional royalty systems, NFT is a pure digital native. By definition, NFT is not a simple transplant of ownership and economic ownership of things in the physical world and the Internet. Rather, it is a reinvention of the old paradigm of economic ownership and access, where ownership drives out others and prevents others from enjoying what you have. In the same way that your stealing from me affects my revenue, the enjoyment of others becomes the same role of thief. However NFT provides a new type of the structure of the system of ownership and use right: I have a thing, also don't interfere with all the other people enjoy it brought to people's physical and spiritual value and pleasure, on the contrary, the more known as a NFT, appreciate and love it, the higher the value of it on me.

As a simple example, NFT creators of Cryptopunks can continue to gain profits from exchanges between NFT owners. The more the audience, the wider the spread, the higher the income of creators. NFT owners can use and dispose of NFT (sell, use, hang out and share) and also have the value of NFT assets. The creative content of creators attracts and influences the way of purchase and disposal of owners. The more the audience, the wider the spread, the higher the price of NFT assets, and the sense of showing off is satisfied. The audience can enjoy the use of communication and secondary creation without any obstacles or even costs.

You probably don't need to understand the complexities of NFT to transform the digital economy and royalty regimes, but digital value and ownership is moving towards decentralization, away from group control and away from platform control. NFT itself to the real world, it seems, and the Internet media economic change of the ownership and use right certificate, the spread of the unique freedom of information and Internet, the future of the Internet will be a NFT property on the basis of the value of the Internet and block chain network, a creator, owner, the audience communicators to build network.

Business examples of NFT to the real world and Web domains

2021 saw an explosion of innovation around NFT, a trend that is likely to continue for many years to come. The current TYPE of NFT is no longer just a single content and media such as MEME or painting.

1. Art Collection:

People like to collect digital art for the same reasons they like physical art, fashion, vintage cards and so on -- NFT art is a mix of aesthetics, patronage, status, collecting and social.

2. Music:

Due to the particularity of its communication media, in the physical world, music can only be paid through physical media (CD, tape, live), while in the field of Web, there are very few ways and rewards for revenue. The advent of NFT has led to a lot of logical ideas about the creation, ownership, use and distribution of music, such as Pianity.com and Royal.

Pianity - Everyone can listen to music, only one can have it. Is the best interpretation of the new paradigm of music NFT. Each track is also cast as NFT and available as a limited edition. Their scarcity makes them very valuable. Artists get more value for their music because of NFT, earning recurring revenue every time a limited edition NFT is traded.

3. Game props:

Web 2 gamers spend an estimated $40 billion a year on virtual goods, but they don't actually own game items, which are owned by game companies and are subject to unlimited reissues, malicious modifications and deletions. At the same time, game items can not be exchanged in other games, game items are only single payment and have no user transaction value. NFT allows users to actually own game items, and future games may be built around items that users own, rather than relying on games. Things like Axie Infinity and NBA Top Shot have sparked a Web 3 gaming boom.

4. Redeemable physical goods/Tide brand NFT digital:

Adidas Metasuuniverse has been firmly at the top of the Opensea since its launch. The trendy shoe collection has moved from the physical shoe cabinet to the Web3 Internet NFT asset list, solving the problem of high storage, maintenance and flaunting costs, which may not be enough trendy shoe enthusiasts to convert NFT applications into redeemable physical goods.

Nike announced The acquisition of RTFKT, which makes a pair of NFT sneakers called The X Evolutions inspired by The Air Jordan 1 OG, Whaleshark, a famous NFT collector, acquired 22 ETH. Whaleshark also received physical shoes made by RTFKT after the auction. Perhaps in the future, you will see a lot of characters in the meta-universe made and designed by RTFKT wearing Nike fashion shoes and clothes to play in the meta-universe world, its brand value and advertising value is self-evident.

@Zaid Kirdsey

The NFT movement to change the economic rights and ownership of creators is happening:

- Jay Chou fashion brand PHANTACi will release the "Phanta Bear" series NFT on Ezek platform

- NBA star Stephen Curry's "2974" NFT series sold out in five minutes and $1.46 million will go to charity.

- Disney will release Mickey Mouse NFT on NFT platform VeVe

- Basketball legend Michael Jordan Michael Jordan is launching NFT joint venture 'HEIR', HEIR Inc., in 2022. Created and designed as a bridge between athletes and "cultural creators," NFT will be the backbone of the new digital experience Heir offers on a membership-based basis.