Will the excitement subside? NFTs, which have been widely publicized in recent months, have not escaped a hurricane that has sent crypto assets plummeting far from their peak. In this highly speculative market, such a household seems to be welcome. In 2021, the NFT exchanges, against the backdrop of high prices, exploded, reaching $17 billion in transactions, according to the specialist website Nonfungible.com. The start of the year had set the tone since March, and artist Beeple, during an auction organized by Christie’s, took home $69.3 million for one of his digital works. Titled Every Day: The First 5000 Days, it consists of a collection of digital drawings that the artist has drawn daily for over thirteen years. This sale is made possible thanks to the NFT or “Non-replaceable Token”, the translation of a non-fungible token. It is a token, like cryptography, in other words an asset that is exchanged and recorded on the blockchain, which is a digital, decentralized ledger. But unlike Bitcoin or Ether, NFT is non-fungible, which means it is unique. Technically a lot.
Concretely, “It is a technological standard that certifies the authenticity of a core element,” explains Faustin Florett, president of ADAN, an association representing players in the digital asset sector. Core elements can be very diverse. A photo, a video, a tweet, a digital map of a soccer player, a plot of land in a virtual world called the metaverse… The range of possibilities is wide.
interest? “Rarity exchanges,” Faustin Florett says. A deceptive concept in the digital world where there is nothing simpler than copying and pasting a suitable file (image, audio, etc). NFT allows a piece of data (a picture for example) to be associated with a person. The system is timestamped: if someone creates another NFT from the same image, it will be easy to tell which is the first and therefore the original. “It is a new form of title deed” sums up Daniel Villa Monteiro, Education Director of Alera School, a blockchain school.
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Hard to profit from NFT
Niches are evident in the art sector, which quickly took hold of the concept. But the big brands are also very interested in the topic in the video games, e-commerce and even the luxury industries. However, this sector is still in its maturation stage: according to a study by KPMG France for ADAN, only 15% of French have actually heard of NFTs, compared to 76% for cryptocurrency groups.
However, obtaining NFTs is not impossible. However, taking advantage of them will be more random. “In the world of art and collecting, part of the value is subjective and is not limited to the cryptocurrency world,” Faustin Florett emphasizes. The fad of some NFTs can dry up very quickly. Thus, the buyer of Twitter founder Jack Dorsey’s first tweet, worth $3 million in March 2021, was put up for auction last April. Bids did not exceed $30,000…
If the sharp decline recorded in the cryptocurrency market – on which the NFTs depend – encourages you to buy some, to take advantage of the revised price, you must first know where to find it. Some trading platforms have become essential in this market, such as OpenSea or even Rarible. These are sorts of Good Corners of NFT…and like this reference site, they don’t guarantee you’ll get a good deal, nor that you’ll have a serious seller in front of you. It is therefore essential to try to find out as much as possible before taking any action. It should be noted that some artists also sell NFTs directly and that traditional art houses are also beginning to offer NFT sales. Once you discover your NFT, you have to move on to the practical stuff. Because NFT is paid in crypto assets. The most widely used blockchain in this field is Ethereum, you will need to get your ether from a broker like Binance or Coinhouse. You will put them in a “wallet” (an electronic wallet to store your cryptocurrency in), which will also be used to store your NFTs. One of the most used is MetaMask.
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Ease does not preclude distrust. “One of the main problems is theft,” says Laurent Gayard, author of Understanding NFTs and Metavers. “Sometimes people take back photos, or even appropriate photos from other artists, and sell them in NFT format.” If the platforms are researching the subject to try to identify “fakes”, in the event of a problem, do not rely on them to provide after-sales service. Finally, it happens that some collectors have their wallets hacked, even though they are encrypted. In the case of obtaining high-value NFTs, be sure to protect them well. For this, it is better to choose a cold storage system, that is, offline.
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