Let’s start with Bitcoin.
You’ve probably heard of it. Once Bitcoin came around, it created the ability for people to actually own and control a digital item. In this case, it was this new digital currency called Bitcoin. These digital coins aren’t stored or controlled on one company’s servers. If you own a Bitcoin, it’s truly yours to control and manage. Compare this with some other digital currencies in your life, like airline miles or loyalty points. They are under your name on a server somewhere, but do you really own them? The answer is no (read the terms and conditions).
Because the foundation of Bitcoin is programmed into code that everyone can read, people trust it. It follows a set of rules that cannot be altered. These public rules also include how many Bitcoin will be mined over time (21MM). This is one of the reasons people want to buy Bitcoin. The scarcity of the asset drives up its demand. Of course, scarcity alone does not make something valuable, but it helps.
With Bitcoin as our example, we see that through the blockchain, we can have 1) provable ownership of a digital item, 2) that trust and transparency is built directly into the code, which in most cases is made public & 3) we better understand the role of scarcity in determining the value of digital items.
Okay, now NFTs...
It stands for non-fungible tokens, which just means unique, digital objects on the blockchain. You probably have some digital stuff in your life, but do you own it?
Provable Ownership
It’s yours to own, control and manage.
Trust and Transparency
You know what this digital object represents and what it can do. It’s in the code. This gets locked in and can’t change which builds trust.
Scarcity
The owners know that the item is 1 of X.
NFTs: Next-Level Digital Items
Here are four ways that NFTs stand apart from their non-blockchain digital item cousins:
They are tradable.
Perhaps you had baseball cards as a kid or you were all in on the Beanie Baby craze. Because you owned that item, you could trade it with someone else or sell it to someone. Now with NFTs, someone can sell their digital items in an open marketplace, possibly outside of the original environment. Blockchain enables this transfer from one person to another in a safe and transparent way.
They are verifiable.
Digital items that are not on the blockchain can be easily forged. NFTs on the blockchain are verifiable. This means the underlying code behind the NFT tells you exactly what it is you’re getting along with its history of ownership.
NFTs are programmable.
A NFT can change and adapt over time. It can be programmed to respond to triggers or actions taken by the owner. In addition, it can even respond to external triggers like the weather or the score of a game. What this ultimately accomplishes is providing the owner more reasons to own it. The possibilities for what these NFTs can be programmed to do are endless.
They can exist in multiple digital properties
In other words, they are interoperable. Due to the public nature of the blockchain, NFT data can be read by any individual or developer. This opens up the doors for partnerships, network effects, and even bringing NFTs to new digital worlds.
It’s all in the execution.
There’s a secret sauce to NFTs that often gets overlooked and that is the execution. Creating a NFT is not all that complicated and there are platforms that exist that allow someone to create a NFT and sell it in their marketplaces. If you’ve never created one, it’s fun and you should give it a try!
However, the success of a NFT project goes beyond the simple mechanics of creating the NFT. Do the NFTs deliver value to the owner - either extrinsic or intrinsic? Is there a great user experience? Is there utility in the NFT that extends beyond a one-time purchase? Are you relying on data and analytics to make informed decisions and scale with confidence?
This is where GigLabs and NFT Bridge excel. Our experience and solutions can fast track projects while avoiding mistakes and side-stepping any hurdles the blockchain can throw in our way. The NFT industry is rapidly evolving and we adjust our solutions and strategies to evolve alongside this growth.
