Non-fungible tokens are undoubtedly one of the new crazes of the digital world. In just a little time since their existence, they have amassed multi-million dollars in trades. That investment opportunity is summarily the reason why many people buy NFTs – and why you should too.
Perhaps that’s too abstract; let’s give you some examples. NBA Top Shot has made over $230M selling basketball highlight videos as NFTs. Also, Beeple received almost $70M at a recent auction for his art collections as NFTs.
Just those two examples of NFT are enough reasons why anyone would buy a non-fungible token. But beyond that, we have listed other reasons why NFTs are the hot cakes in the crypto-world. Have a look!
3 Reasons Why People Are Buying NFTs?
If you think back to the top examples of NFTs, they are all artworks worth millions of dollars. Then, it is only perfect that the first reason why NFT is gaining so much ground is that artists want scarcity for their crafts. How so?
Before now, anyone could go online and easily make copies of artists’ works for personal reasons without paying a dime. Unfortunately, the illegal duplicates are just as good as the original. For that reason, creators suffer dips in revenue selling their craft on the internet.
But thanks to the NFT technology, there won’t be illegal duplicates of artists’ works online anymore. Now, everyone can tokenize and track their ware online and control how many stays in circulation. How?
The NFT, through blockchain technology, makes it possible to claim ownership of digital arts with unique signatures. Beautifully enough, no one can alter the signatures. Most importantly, artists can determine the scarcity of their wares and still get royalties even in the case of resale.
2. Early Adoption
Beyond artists and musicians, other people are only into NFT because it is a trend. Perhaps many fear the technology won’t be sustainable because of its environmental impact. For that reason, they want to cash in on the trend while it’s hot.
Then there are other early adopters; they are into NFTs because they want to set the trend. In other words, they want to set the price of digital arts and reap big profits. How?
The said adopters will buy an NFT at a reduced rate and resell at a profitable price. A typical example of such an instance is Pablo Rodriguez-Fraile’s case; he bought Beeple’s Crossroads for just $67K in October 2020 and sold it for $6.6M after 4months.
3. Pandemic And Distrust In Dollar
Another reason most people jumped on the NFT train is the COVID19 pandemic. Most people were at home, and they were looking for any security. At that moment, cryptocurrency came to the fore and has been great ever since.
Weirdly enough, the pandemic and cryptocurrency boom happened when global economies suffered losses. For that reason, people couldn’t trust their savings in dollars and prefer to invest in NFTs.
That said, there might be other reasons why people buy NFTs. But rest assured that we have itemized the key ones. More so, the real question you should even be asking is if you should buy a non-fungible token. We say you should!