NFT is the future of digital art? NFT provides the next platform for fine art investment? Investors need to understand about investing into art.
Some greatest of Art world enjoyed Grimes’ sale of NFT art for $5.8 million as initial step in the blockchain uprising. Others didn’t appreciate idea of investing thousands of dollars for a digital art file that we can see online easily that too free of cost.
You may consider NFTs as future or a fad, one thing is so sure: art universe is shaken by them.
Investors need to understand about investing in NFT and art investing.
A NFT (non-fungible token) is the data addition to a file that creates a unique signature. It can be an image file, a tweet, a song, a text posted on a website, a physical item, and various other digital formats.
This basically means that anyone can be a owner of a digital file (and that it’s marked with code to differentiate it from any digital replicas).
NFTs give us a direction to have clear ownership over digital items. Consider how they’re the same and different from a physical object, For example: collectible cards (Pokemon, NBA, etc.)
Like real estate, fine art, and other crypto currencies, the biggest risk for NFT investors is whether the items will keep their value.
Token holders may get stuck with NFTs if their popularity declines and people stop wanting to buy them.
NFTs, (like all cryptocurrencies) have a large impact on the environment. NFT transactions must be verified through Blockchain to guarantee the encryption is valid, which consumes enormous amounts of energy.
The creation of an average NFT has a carbon footprint of over 200 kg – about the same as driving 500 miles in a typical American gasoline-powered car.