Culture Hack

Culture Hack

How NFTs are Changing the World of Collecting

Imagine making $5.8 million dollars within twenty-minutes of an auction for a piece of work that, in reality, only exists digitally. Or, think about entering an auction for a one-of-a-kind creation, winning it, and owning it immediately, with the freedom to post and profit off it further as you please. That’s exactly what singer and artist Grimes did and what happened to some of her biggest fans on March 2nd, when the Canadian native auctioned off eight tokenized pieces of original artwork on Nifty Gateway: “the premier marketplace for Nifties, which are digital items you can truly own” according to its website. Like other hubs of digital commerce, Nifty owes its success and popularity to a new type of currency that has gained traction due to at-home living: NFTs.

Simply put, NFTs — or non-fungible tokens — are digital collectibles. They are unique and irreplaceable cryptocurrencies meaning, unlike bitcoin or other similar currencies, cannot be traded for another NFT. NFTs are part of a blockchain, a digital system that defends against hacking or changes. Blockchains allow each individual currency to store extra information, meaning more intricate digital goods. As a whole, the value of NFTs has quadrupled in the past year, with a collective value of $250 million. While the surge in use of cryptocurrencies has been felt by other variants due to the general boredom of at-home life during the pandemic, the success of NFTs foreshadows a new way of living, possessing, and experiencing culture. 

Many were left searching for ways to experience their favorite forms of art and entertainment with restrictions that ultimately left museums, concert halls, and other spaces for socializing through the appreciation of culture. But through the use of NFTs, content creators are finding ways to satisfy spectators of all genres while also entering a new phase in their career where they can own the property rights to digital creates in a way they couldn’t previously for physical creations. The most recent and groundbreaking use of NFTs came from the music industry; legendary rock group Kings of Leon announced that their newest album will be released exclusively as a package vinyl and NFT deal, making them the first musical artists to do so. On top of the album package, the band will also offer tokenized items in a series called “NFT Yourself” which include opportunities that will offer fans front row seats to concerts for life. 

Art has been the most common industry to benefit from NFTs, giving creators the opportunity to, in a way, own their own galleries as well as to successfully distribute their art across digital platforms. And in an era where every successful company needs a good virtual presence to survive, NFT crypto-art gives businesses an opportunity to possess and fully own original content indicative of what they stand for. Another example of this newfound freedom comes from Dapper Labs — a major NFT company — and its partnership with the NBA to launch NBA Top Shot: an online company that allows fans to purchase and own a collection of digital basketball highlights. The value of each highlight, like most other NFTs, is dependent on how rare or common the content is. For example, a collection that has a thousand copies will cost significantly less than a collection with only one hundred, and content with only one copy can only be won via auction. In just one week, NBA Top Shot made close to $150 million in sales according to CryptoSlam.

As different industries begin to discover the power NFTs hold for profiting off content creation, it feels like a move to digital collection and ownership is yet another product of work-and-live-from-home culture due to the pandemic. It does prompt one question about the evolution of the role the internet has played in our lives: was Covid the big push virtual living needed to become a full reality? While the answer to this question is complicated, given that NFTs came into existence years ago, one general fact about this cryptocurrency is very clear — NFTs give both collector and creator a new sense of ownership or profit that traditional collectibles could never.