What's an NFT?
It may seem a bit late in the fad to be asking this question, but we're still getting tons of inquiries about them from clients and journalists, so it pays to be thorough.
Let's start with what a non-fungible token is not. It's not a copyright. That's for sure.
Advocates of cryptocurrencies and the broader crypto space are generally opposed to things like censorship and copyrights.
The code for virtually all cryptocurrencies is open source, and creators don't generally have any restitution when someone copies their work.
This is an industry where it's common to simply copy and paste code and implement it as your own.
Also, those images that are being sold on the open market, once released on the internet, have no additional protection from people looking to reuse them.
Here, the NFT for this pixelated ape just sold for 800 ETH (approximately $1.5 million), and here I'm using it as part of a newsletter without paying a dime, nor even breaking any rules.
It's not even a screenshot either, just a regular right-click and "save image," right off OpenSea.
Perhaps the best explanation I've heard so far is that it's a form of digital signature.
What these artists are doing is more akin to selling autographed prints of their work, only the autograph is digitally verifiable and limited in supply, ensuring the scarcity element that collectors desire.
Is this a bubble?
It could be, but in my humble opinion, we're just getting started.
The fact that big brands like the NBA and Taco Bell are now entering the space tells us that it's trendy right now, and as we know, fads have a way of fading.
Technology on the other hand doesn't fade, it continues to develop. And it's exciting to think how this particular tech might evolve over the next few years.