There has been a lot of Buzz about NFTs and people are wondering whether they are a good investment.
The answer is a big MAYBE, but most likely, they are NOT an investment worth considering.
Let’s start by answering the question
What are NFTs?
NFTs stand for non-fungible token. In short, it’s a sort of digital identifier that certify authenticity and ownership of a digital asset.
Imagine that I take a photo, as I do every day as a photographer. Many of my photos are posted on my website and can easily be copied by anybody else, and maybe the thief of my photo could say he was the photographer, sell it and make a profit from it, and maybe I would have a hard time proving that I was the original artist.
But if I had an identifier which could prove that I am the rightful owner of that digital asset, only I would have the right to sell that photo.
An NFT is just that, a certificate of ownership of a digital asset. It’s not the art itself because the art can be seen or experienced by others for free, it’s the certificate that’s valuable. The bragging right of ownership.
Just because it represents a new technology related to the blockchain, early speculators paid a lot of money for NFTs, and many of those speculators made some money selling it to bigger fools.
After a while, thousand of people started to create NFTs, and surprise-surprise, the novelty was gone, the market got saturated and now the value of most NFTs is close to zero.
As an artist, if you were able to sell your art in the form of NFTs, congratulations. Your are are the equivalent of the person who sold a high priced tulip and the height of the tulip mania.
As a speculator, I only have two words for you: “Stay Away!”
Imagine a time in history where artists were making the transition of making art in wooden panels or clay tablets to paper. The first few creations in those piece of paper have lots of value, not because the art was so beautiful, but because it represented the novelty of using paper. Then, as everyone else started using paper, the trill was gone.
The novelty of NFTs is gone. We missed that little second in history when idiots were paying top dollars for digital assets. It’s time to look for the new new-thing.