This month, Haven Collective members were brought up to speed on NFTs by marketing coach and Sentient Labs Co-Founder, Tobias Roediger. Our members had a ton of questions about NFTs from what exactly they are to their future potential. Continue reading to get answers to the top 6 questions we were all dying to know.
NFT 101: 6 NFT Questions Answered
What does NFT stand for?
NFT stands for “non-fungible token.”
What is an NFT?
An NFT is a token (Aka: Asset that you can own) that lives on the blockchain and represents ownership/access. I know what you’re thinking…what’s “fungible”?
Fungible is an economic term that means that it can be exchanged evenly for something else, thereby simplifying the trade and exchange process. Think: money, cryptocurrencies, common stock shares, and commodities. So, if an NFT is NON-fungible, that means that it has unique properties that make it impossible to be traded evenly for something else.
NFTs are unique, irreplaceable, and non-interchangeable, like artwork or diamonds. You can’t trade them easily like currency can be. You can’t mutually substitute one with another without a change in value.
NFTs are digital tokens that have been added (or minted) to a blockchain. They are NOT the image, artwork, video, etc that are attached to the token. The NFT represents a verifiable record of ownership, and provides visible and trackable provenance from creation onward.
How is an NFT different than cryptocurrency?
While both use the blockchain for transactions, crypto is used as a currency and has only has economic value, while an NFT has both an economic and non-economic value.
NFTs are collectible with values set by speculation and demand, while cryptocurrencies are meant to be used for transactions with values set by the market.
How are NFTs being used today?
NFTs are primarily being used to show ownership of digital assets right now. You’ve probably seen headlines that describe digital graphics, drawings, and videos being sold as NFTs. They are also being used to create decentralized ownership contracts of physical assets between multiple people (like a painting). You will also see them being used for the metaverse and gaming. We’ve only just scratched the surface so far on all the potential uses for NFTs.
What is the potential use for NFTs in the future?
There are a lot of potential uses for NFTs, but some areas that are expected to be disrupted by NFTs include:
- Proving product authenticity
- Real estate (such as title insurance)
- Medical records and identity verification
- Intellectual property rights
- Academic / educational credentials
- Memberships and loyalty reward programs
- Supply chain and logistics
- Artwork tracking / provenance
- Collectibles and memorabilia
How are NFTs changing ownership?
Ownership of digital assets like music, movies, books and more are not currently “owned” by you if you purchased them through stores like Amazon or Apple. Instead you actually have a limited license for the lifetime of your account. If something happens to your shop, you lose your purchase. You can’t share or sell your purchases either, another telltale sign that you don’t actually own it.
NFTs unlock true ownership of digital assets, where you can actually sell, trade, or lend your purchases to other people.
That’s a Wrap
We’re so thankful for Tobias’ time and expertise on this topic and we look forward to bringing him back to keep us updated on the quickly changing world of NFTs. To stay in touch with Tobias Roediger, follow him on Twitter or connect through Sentient Labs.
Haven Collective members have the added perk of 30-min one-on-one coaching session with Tobias as a member of our coaching team. To learn more about Haven Collective in-person and virtual memberships, reach out to us.