What is NFT, What Does It Have to do with Facebook’s Rebranding, and Why You Should Care?

Have you already heard of NFT – a new way to create an “original” version of a digital file?

Trading digital art that’s minted as NFT is the hottest investment everyone has been talking about for a couple of years now. Drawings made by newcomer artists, or even those created by AI, are sold at enormous sums and attract more and more interest in this new technology. With Mark Zuckerberg’s announcement of his Mataverse vision, it seems NFTs will soon become part of life.

Last week, I took part in NFT.NYC – the biggest convention of the NFT community, that included experts, collectors, artists, and celebrities, such as Justin Timberlake and Quentin Tarantino. I wanted to take everything I’ve learned there and write a basic breakdown of all these futuristic terms being thrown around more and more in the media. Just watch out, after you read this, you might become as addicted to this brave new world as I am.

Wait, What is this NFT Thing?

NFT means Non-Fungible Token, which probably doesn’t help you understand what it is. Essentially, it’s a new technology that makes it possible to prove ownership of a digital file. The file in question can be a drawing, computer game character, video, or sound. The file is “minted” and a unique code is created for it. That means that each NFT is registered in the blockchain, so it cannot be forged or duplicated.

Owning an Nft is like owning Cryptocurrency, but unlike coins, each NFT is unique and its value is determined by the market. It is very much like art collecting in the non-digital world. The possibilities created by the NFT technology and the hype around it lead to the development of a booming trade market where artworks by unknown artists are sold for enormous amounts.

Why is Everyone Ttalking About NFT Right Now?

The first NFT files were created in 2017 and the interest in the technology has been growing ever since. In March, NFTs made worldwide headlines, when an NFT artwork by digital creator Beeple was sold at Christie’s for 69 million dollars. That is the highest sum paid for digital art to date.

Why Would Anyone Pay So Much for a Digital File?

The first question people ask about NFTs is why would anyone pay so much money for digital art, that anyone can see online. And in case you’re wondering, while the NFT purchaser receives proof of authentication, the digital file that he owns appears just the same on their computer as it does on yours. There is no tangible difference between its copies. This is a complicated, and even a philosophical question, that can be answered in a few ways:
– The question of uniqueness in art has been discussed since the invention of photography. In 1936, philosopher Walter Benjamin wondered about the differences between the Mona Liza and a photograph of the painting. in his famous book “The work of art in the age of mechanical reproduction” he theorized that in the modern age, the relationship between origin and copy are reconstructed.

Following that train of thought, NFT is a new way to create ownership in the digital world, where the differences between origin and copy simply don’t exist.

-On the more practical side, we should remember that people pay for imagined value all the time. We call that branding. A Louis Vuitton bag’s worth has nothing to do with its tangible properties and lies instead in its perception and demand.

-To better understand better NFT and the possibilities it opens, one should look into what’s already happening in gaming. In the world of computer games, it’s normal to pay real money for virtual objects. In many games, players buy “skins” – virtual clothes for their online avatars. NFT allows that practice to be taken out of games and into other digital realms.

So What’s the Connection to Facebook?

If the NFT scene wasn’t bubbling enough, Mark Zuckerberg announced that the Facebook Corporation will change its name to Meta as part of its vision of a Metaverse a couple of weeks ago. What does that mean? Metaverse is another hard-to-understand buzzword. Understanding it is probably like explaining Instagram to someone in 1995, Plus, the idea is just in its initial stages, and we don’t even know for sure what it would look like in the end. However, we can imagine it as a combination between a social network and a video game that leaves the confinements of screens and happens in AI. In simpler words, a very realistic game of SIMS we’ll all be living. This might sound like a sci-fi movie, but one of the most influential tech businessmen in the world just described it as his goal.

All of the financial transactions in this AI universe will be based on buying and selling virtual objects. But while the drawing of furniture in your SIMS house remains in the limits of the game, in the Metaverse, they will be sold as NFTs and will remain your property that you can sell of trade just as physical objects. When you’ll decorate your Metaverse virtual house you’ll have different brands of virtual furniture that will be advertised in the new versions of Social Networks.

Conclusion

Whatever the philosophical and historical reasons for the development of the NFT technology at the current time, it’s evident that a lot of people want to pay a lot of money for NFTs and the market is booming. The NFT trading community is quickly growing on Twitter and Discord. People from all over the world share stories of great wealth and tips on selling digital art. To become a player in this field and avoid too many rookie mistakes, you need to invest a lot of time reading, talking to experts, and learning. I hope to share more of my own journey into NFT here on the blog. Stay tuned!