Non-Fungible Token (NFT) is a digital certificate encrypted and verified on the blockchain. This is the most technologically advanced trend of 2021 with great promise for 2023 and beyond. In the search engine, “NFT” exceeds requests, compared to the cryptocurrencies “Bitcoin” or “Ethereum”, in addition, the value itself is more stable than that of digital coins.
Many companies around the world are looking at NFTs as a fundraising method. Such tokens can be created from almost anything – digital images, articles, music, and more. As Whidegroup expets says the main plus is adaptability and the ability to carry out an authenticated transfer of ownership of certain services and goods in the blockchain.
Is NFT a safe investment?
The Securities and Exchange Commission (SEC) regulates such assets and requires them to be registered with the commission before they can be sold publicly. The SEC often reviews whether an investment meets the definition of an “investment contract” to determine if it is of value.
Speaking of NFTs, if such an asset is a work of art or other kind of creativity, then it can be regarded as an element of collecting, and not as a security. NFTs may fall under SEC control if the issuer sells the token as an investment, which involves an initial assessment. For example, if the Nike brand creates a new collection of 100 NFTs, which has a limited edition for a specific collection. After the company notifies customers that each NFT will only become more expensive over the years, because only 100 tokens have been issued, and the proceeds will be used to create new sneakers – this is more like securities than collecting. Point of sale technologies in retail are increasingly enabling businesses to accept cryptocurrency payments, including for NFTs. If a brand tells customers that they can sell tokens on the secondary market and take profits from the sale, then it would be difficult for the firm to avoid registering the token as a security.
Equally popular are fractionated NFTs, F-Nfts, and NFT baskets. Products of this type make it possible to invest in a certain percentage of one NFT, and also facilitate the purchase of several NFT shares at once. Fractional, Niftex and other platforms help the average person buy and sell F-NFTs in the same way that investors trade stocks or collectors sell stamps, eBay cards.
As a result, firms that create NFTs to raise funds and subsequently produce goods and services should seek expert advice on securities to know if there will be violations of securities rules.
What is NFT?
In 2021, many news publications published materials that another NFT painting sold for millions or thousands of dollars, people pay huge amounts for digital products (images, songs, real estate and other items). Technologies of machine learning, such as natural language processing (NLP) and computer vision, are being used to develop new and innovative NFT marketplaces in 2023. The market itself was estimated at 40 billion dollars for 2021, and the popularity of NFT tokens is only growing and you need to understand the main trends in the development of technology for 2023. You need to understand why they attract, cost so much, what benefits they bring and are interesting to investors.
The whole feature of NFT lies in the uniqueness and ownership of the cost and value. Tokens are completely unique, a specific type cannot be changed to another or divided into several parts. For example, Bitcoin is 1 unit and it can be divided among other market participants, the dollar can be divided into 100 cents, etc. It is impossible to do this with NFT, it is one separate and indivisible unit.
NFT is a certificate that gives ownership of a digital asset to its owner. The object can be an element of creativity, game details, real estate and much more.
As a result of an increase in demand for tokens, NFT marketplaces have emerged, presented as separate platforms for buying and selling digital objects. The largest and most popular service is OpenSea, which launched in 2017. At the beginning of 2022, the platform set a record for trading volume of $3.5 billion.
In addition to OpenSea, you can sell and buy NFTs on other platforms:
- rare;
- niftygateway;
- superrare.
All operations are carried out using the ETH cryptocurrency, and the marketplace takes a commission for any operation. In addition, any of the presented platforms is also needed to create your own token.
The NFT market is expected to be over $100 billion by the end of 2026, with an average annual growth rate of 40-50%. Based on this, today you need to think about trends, tendencies and opportunities to enter the young market.
Despite the statistics, numbers and technological breakthrough, tokens seem to many people to be something alien and complicated, but the trend continues to be popular, it includes global brands, large companies, funds and investors. It was similar with cryptocurrency when it first appeared, and already in 2022 it is used all over the world, somewhere to a greater extent, somewhere to a lesser extent.
Nobody can predict the future of NFTs, analysts and experts in the field are confident that tokens will be a convenient means for monetizing their own skills, services, and goods. Due to the active interest and development of technology, it is important to understand the main advantages and trends in the development of the environment.
NFT tokens – a list of amazing examples
Strong attention and involvement towards tokens is seen among collectors and gamers who need NFTs to get unique, rare weapons or cards to continue playing. The NFT space already has its own history. It is famous for the personality of Mike Winkelmann – an artist who is called Beeple in the digital world. In March 2021, he put the first collage up for auction and received $69.3 million for the sale.
There are other lucrative deals in the NFT token environment. For example, the creator of Twitter received $2.9 million for a tweet, a Times journalist sold tokenized covers, and Elon Musk created the first NFT track. There are a lot of such examples, the history is constantly supplemented by new names.
In this environment, not only famous and rich people or global manufacturers of goods, there are no restrictions on gender, age or other characteristics. That’s why there’s a lot of hype around NFTs, where anyone can take ownership of a unique product or earn large sums of money from it.
A typical Indonesian student was able to earn $1 million on OpenSea by selling his own NFT selfies. His name is Sultan Gustav Al-Ghozali and in total he has sold more than 1000 selfies.
The market has become very large, in 2022 the first tokenized series called GenZeroes appeared, and people who bought NFTs get access to it.
The trend has not bypassed Ukraine either. Singer Alyona Alyona received over $7,000 by selling her own track “Galas”. The Okean Elzy group divided one of the songs into fragments and sold it in the form of tokens.
Non-fungible tokens are a new phenomenon in the crypto-currency world and mainstream, considered the main trend in software development in 2022 and 2023. NFT is a piece of digital content directly related to blockchain and cryptocurrencies. Dynamics 365 for Sales Consultants can leverage the NFT market in 2023 to create new opportunities for their clients and generate more revenue. Tokens are unique, they cannot be replaced, so 2 identical assets will never exist. For this reason, blockchain-based payments are gaining popularity, which provides complete security, high speed and transparency of any payment.
Advantages of NFT tokens:
- The ability to prove ownership rights for a specific person, because NFTs cannot be divided between 2 owners at the same time.
- Easy transfer of ownership through the use of smart contracts.
- Tokens are developed on the blockchain, which links them to specific data.
Many users only compare NFTs to digital art that can be sold for a high price, and this approach can be a good, modern source of small business profits. The question remains how long this trend will continue, but there is no exact answer. Experts say one thing – it will not disappear soon and will remain for many years in the realities of human life. The reason is that large funds, brands, influencers are starting to join the NFT movement.
Future and development trends of NFT
Society around the world is just beginning to understand the principles and understand the field of NFT, many developers and specialists are showing a desire, interest in understanding the role of cryptocurrencies, blockchains, tokens in everyday life. The NFT market is still actively developing only with the help of collectors, while changing and expanding. Soon, tokens will be used in everyday life, for example, with their help it will be possible to translate documents, create theses, and so on. Debit and other cards can move into the NFT sector, gaining the ability to pay for services and goods.
The world is beginning tokenization and digitalization, many familiar processes are moving into the digital world, and blockchain is used not only by individuals, but also by the public sector. With the help of NFT, it is possible to tokenize a service, a product, in other words, transfer everything to the blockchain.
Previously, humanity could not imagine paying by cards or by phone, but in the modern world, this is normal. NFT tokens will have a similar outcome, the technology is showing up more and more and digital wallets in the future will be able to contain documents, certificates and other items that a person owns.
Key NFT Trends in 2022-2023
After the rapid growth and active development of NFT, several methods of applying the technology have emerged. In 2021, they became available in the following sectors:
- decentralized finance;
- art;
- games;
- smart contracts;
- fundraising.
There are a lot of trends, but there are main directions of development for the next 5-10 years.
Getting loans using NFT
This is a relatively new lending method in which investors pledge their own NFTs, collections, in order to receive money for new projects or non-standard situations when funds are urgently needed.
Many platforms have been created to implement such an idea in the decentralized finance (DeFi) sector. They allow NFTs to be used as collateral before loans are issued. Arcade is one of the most popular DeFi platforms that provides NFT lending. After agreeing to all the terms, the assets are blocked in an escrow account managed by a smart contract. Until credit obligations are repaid or a default occurs, NFTs cannot be returned, they are blocked.
Another trading resource is NFT, where people can place assets as collateral for a loan or offer a loan to another person. Lending is given in the ETH cryptocurrency, if there is any ERC-721 network token secured. When the loan is paid off, the NFT is returned.
NFT games
With the rise in popularity of NFTs, gamers have begun to see that tokens are more suitable for gaming. Many technology-based projects help gamers use NFTs, which open up new possibilities. The future of games built on the blockchain includes a large number of tokens and this is a popular destination for domains.
With the help of assets, players can make their game content and sell it on OpenSea or other similar sites. NFT is a key factor for blockchain games and in the future, the transition will be the basis and standard for such an industry. It’s important for developers to pay attention to the technology and start applying it to game development today.
GameFi App Development Trends
The games themselves use tokens that can be easily turned into an item to support the gamer or get an additional level, points, and more. According to the developers, the technology can reduce the cost of creating games and increase the loyalty of communities. NFTs are also implemented on physical elements for gaming, for example, on cards, after which they are transferred to a digital format using blockchain protocols.
Since 2021, new games focused on the “play and earn” (P2E) model have been actively released, and the most popular of them is Axie Infinity. NFTs related to the gaming industry generated over $4.5 billion in revenue in 2021. Of course, gaming reality is still popular today, in 2022. It is also very profitable.
With games, we have the ability to work with completely different items within the game. These items can be completely different and not similar to each other, such as weapons, clothing, cards, and avatars. After earning tokens, players sell rare NFTs in the markets, earning real money. There are suggestions that this trend will dramatically affect the development of the gaming industry.
NFT Tickets
After the unique digital token on the blockchain has been created, it is possible to sell it to the client in digital form. This is very convenient because it gives us the opportunity to keep assets in an electronic wallet, while each time the opportunity to use it in any place, on any gadget. Another bright trend is the digital ticket, which is very convenient today. During their sales, the owners have the opportunity to create a certain amount of NFTs, encode them to determine the value, or arrange an auction where the user has the opportunity to offer his own price.
People will be able to keep the ticket in their wallet and present it when attending the event, as in other areas. The NFT trend will continue to grow in the coming decades, with ticketing being a new area to consider. Many businesses have already created and launched their own tickets to test the technology in real-time.
Avatars and PFP NFTs
PFP NFTs have started to appear along with regular NFTs. Since 2017, CryptoPunks remain the most successful in this niche. The standard model, applicable in many projects of this kind, is the creation of 10 thousand characters from a regular template. Each image has 10 features:
- clothes;
- hairstyle;
- accessories.
There are 10 variables for each trait, which causes a shortage of the collection itself and leads to the large popularity of the avatar, giving it a solid look.
Avatars and PFP NFTs
Many PFP NFT projects have 50% avatar (head and shoulders) which is great for online 2D social work. CryptoPunk and other NFTs can be used as a unique profile picture or identifier on certain sites used on the network for this reason.
NFT Digital Twins
With the help of a digital twin, you can duplicate any service or product. This is done using virtual reality and simulation techniques. Technology helps create or replicate genuine goods and services in digital form.
Thus, the exchange of information is possible between a copy and a real physical object. All this can be done with the help of sensors, they, in turn, have the ability to monitor the state. Today, many of the largest and most famous brands are entering the digital realm, while doing everything using the NFT twins in their work. For example, let’s look at Adidas and its merger with Karlie Kloss. Of course, this combination allows customers to implement the brand’s digital sneakers on the blockchain.
Artificial intelligence NFT
Today we have the opportunity to create NFTs using artificial intelligence. Already in 2022, a new trend began to appear, which will continue until 2023 – the integration of AI into NFTs. It will be a completely new and unique new experience that will captivate absolutely everyone since it is almost impossible to reproduce it by introducing other technologies.
Alethea AI is one of the first decentralized protocols. It is capable of allowing the creation of intelligent avatars that implement artificial intelligence to interact with society. Here we can give an example – iNFT “Alice”. This opens up great opportunities for us to be able to learn on our own. The flow of certain knowledge can go constantly when we have contact with people. Consequently, the company that developed this has already managed to get over $16 million for scalability and aims to create a metaverse. Of course, this allows artificial intelligence to learn from each other.
Artificial intelligence NFT
We can use NFT using artificial intelligence, however, in 2022 the situation will change a little, as completely new trends will be created that will be relevant until 2023 – the integration of AI into NFT. It will be a completely new, very dynamic experience that simply cannot be replicated with other technologies.
Alethea AI is one of the first decentralized protocols. They, in turn, are able to allow the creation of intelligent avatars, while using artificial intelligence in order to interact with society. A wonderful example here is the iNFT “Alisa” with very large opportunities for self-study. When there is contact with people, a new flow of knowledge occurs. The development company has already received over $16 million in funding for scalability. Of course, the goal is to create a metaverse in which artificial intelligence can learn from one another.
NFT Music Trend 2023
We need to know that here, in addition to ownership, authenticity is being formed, and a new community is being formed around NFT and music, giving autonomy to musicians. It is estimated that by 2025, the NFT music industry will be able to reach a capitalization of over $80 billion.
NFT Art (Metaverse galleries and auctions)
Today, art is the main focus of the NFT sector. The market tends to grow constantly, which in turn gives artists the opportunity to express themselves in every possible way. For example, art foundations that create digital art from physical works are increasingly attracting famous people to this direction.
Some of the newest trends in the universe are metaverse galleries and auction houses. These help platforms are able to allow artists to arrange their work in the digital galleries of the metaverse. If you decide to go to such an exhibition, you will definitely need glasses.
Today, the rapid pace also has a trend in the development of the auction house. In it, for tokens, people themselves claim to be the sole holder of NFTs. According to experts, in the coming years, artists will begin to get rid of physical works in the presence of NFT, which will lead to an increase in demand for digital art.
NFT in healthcare
It is worth noting that all digital technologies actively began their development with the advent of the COVID-19 virus in the world. Today, blockchain and NFT are relevant in many fields of activity, it has found their application even in medicine. Of course, it is worth noting that in order for the quality of services to be much better, a very comprehensively developed exchange of medical services based on the blockchain has appeared. This database makes it easy to own information about patients (if they wish). The same can happen with NFTs, thanks to which the monetization of information will begin with the help of tokenization.
Healthcare NFT Trends
Very soon, the NFT will be able to provide its support to the population. If we consider the wonderful connection between medicine and tokens is the Health Hero, a metaverse character. Of course, if you have a proper and healthy lifestyle at the same time. character and other qualities will appear, and only after that, you can sell the avatar inside the digital world.
Blockchain and NFT provide security and protect the information, so in medicine, it will be possible to solve health problems, such as identity theft or threats.
Real Estate NFTs
The biggest problem with long-term investments in real estate is ownership and the issue of their transfer. NFTs solve this problem by helping investors verify ownership of a particular property in minutes. Therefore, the use of tokens in real estate is a good trend for development in 2023.
Blockchain technology paired with tokenization enhances the degree of security and safety of information. This can protect not only buyers, but also sellers, significantly speeding up and simplifying the transfer of such assets. So far, very few companies use NFT in real estate, but this is a new trend that will soon enter the masses due to its flexibility and a number of other advantages.
Virtual Lounges
The next development trend for 2023 is virtual lounges, which hit the market in 2022. Blockchain, websites and other platforms cannot constantly grow, increase – this is the main problem with the demand for NFTs. Considering tokens that are traded on auctions and other resources, platforms can be damaged by the number of participants, and virtual waiting rooms solve the problem.
They are created as a separate place where the client can wait for a while before resetting the NFT. If there are 3-5 or more drops, you can create several waiting rooms at once for further trouble-free processing of transactions. With this trend, more and more ideas will appear.
The sphere of Web3 digital assets is developing rapidly, it is difficult for humanity to accept it yet, but it is also impossible to resist. Many influential and famous people have already tried various Web 3.0 products, which has enabled large companies to implement NFT in their marketing.
NFT reduces the initial investment in any business, tokens solve traceability problems, because companies can control the impact of NFT on marketing approaches.
NFTs have been trending since 2021 and will remain so. This market is rapidly evolving and it is important today to begin to understand the intricacies, understanding new methods to benefit from such a space. Some of the trends described will take time, some of the trends have already contributed to the ecosystem, continuing to develop it.
