Will NFT be a long-term value investment track?
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2020 will be over in less than a month.
Looking back on this year's blockchain hotspots, from the exchange leverage at the beginning of the year to the current DeFi, wave after wave, the wind direction is switching faster and faster. Many people are helpless, so they lament that they can't keep up with the iteration. The "display line" of industry trends.
In contrast, this year there is actually a "hidden line" - the non-homogeneous token NFT. For investors, NFT is a "small circle" that is extremely popular. Recently, at the end of the year, it became popular again.NFT。
So let's talk about this today
NFT is the abbreviation of Non-Fungible Token, which is called "non-homogeneous token" in Chinese. It usually refers to tokens issued by developers on the Ethereum platform according to the ERC721 standard/protocol. Its characteristics are indivisible and indivisible. Alternative and unique, in simple terms, tokens issued using the ERC721 standard/protocol are called NFTs.
NFTs can be a collectible (CryptoKitties), used in games (Axie Infinity), metaverse (Decentraland), tokenized real-world assets (UpLand), and domain names.
NFT is indeed valuable, not just a token stored in a wallet, we can integrate it into the concept of decentralized finance.
If you want to understand what NFT is, you need to understand the current development standards of several tokens in the industry.
Although people like to claim that "DeFi" advocates "decentralization" and "diversification", many people have not yet realized the importance of "standardization" or "homogeneity" for the development of DeFi: for example, in the lending market, only homogeneity Only when pledged assets can be pledged, otherwise the market will not be able to confirm the value of the collateral, which will lead to liquidation risks; another example is the AMM DEX, the liquidity provided by LP must be homogeneous assets, otherwise it is impossible to form an asset pool, and it is impossible to conduct "Batch" transactions.
besides,besides,
NFT is considered to be one of the directions most likely to take over DeFi and become the next market hotspot.
Xu Chaoyi, the founder of BKFUND, introduced several classifications of NFT and the industry map, and elaborated on the internal logic and typical cases of the NFT market.。No.
No.twotwo。The type is: NFT encrypted network assetsENTRefers to the right to use the blockchain network, including the right to use accounts, names, storage resources, computing resources, network parallel chain slots (essentially network security), etc. ,
Similar to blockchain short domain names are currently the most typical encrypted network assets. By purchasing or leasing ENT domain names, enterprises or KOL users can enhance the brand recognition of their own accounts.The third is:“of NFT assets”。tokenized version
Can represent digitized or other forms of assets-this explanation may be somewhat abstract and difficult to understand. In fact, we can think of NFT as a form of token similar to stable coins, which can be used to represent works of art, real estate, or It is a non-fungible asset such as collectibles, rather than legal tender. The current applications using NFT tokens are mainly concentrated in the field of virtual games, such as "encrypted cats" CryptoKitties and Decentraland.
NFTs represent non-fungible assets. On the surface, NFTs can function like other tokens, but unlike most tokens, NFTs are indivisible, which means you cannot send them like you can send small amounts of BTC A small selection of NFT tokens.
A recent liquidity mining project called MEME has attracted the attention of many participants due to its 100-fold increase. Taking it as an opportunity, NFT has gradually sparked market discussions, and many people even consider it to be the next trend in the market.
As with the development of Bitcoin, the success or failure of NFTs will depend on the enthusiasm of the community and the emergence of an ecosystem around the technology, and of course its atmosphere.
Interestingly and challengingly, however, the concept of community in the NFT world is quite different than in a fungible token like Bitcoin. Unlike Bitcoin, which can completely replace any other Bitcoin, a non-fungible token is a single unique digital property.
Therefore, the community that assigns value to the asset is usually very narrow.
It is such challenges that make people start to question what kind of business model is suitable for NFT.
It is worth celebrating that some new models of NFT have begun to emerge again.
One of the key ideas is that creators of digital assets can be encouraged to relinquish control over them by signing smart contracts that link the rights of the original issuer of tokens to future secondary market sales revenue.
Venture capitalist David Pakman believes the idea could lead to game companies accepting NFTs drastically changing how they make money. These companies can deliberately create a limited supply of a particular digital product, ensuring a profit from future sales.
In this way, players are not locked in a closed value capture garden, instead they can take their assets out into the wider world and create greater value for the brand.
It is these ideas that make NFTs so fascinating, helping people to break out of the inherent thinking mode, thus enabling innovators to come up with creative new ways to solve problems.
