Probably you have already heard about NFTs and even more probably you have already read dozens of articles explaining what these NFTs are, even Paris Hilton wrote about them! NFT stands for: “non-fungible tokens”, special tokens hosted on the Ethereum blockchain that instead of containing money, are configured as unique digital objects that can be bought, traded, collected, such as artwork, music, tickets.
Scarcity & Collectability
The artist, by tokenizing his work, certifies the propriety and can decide to make as many certified copies of it as he or she wishes. It could be a unique work, or a limited edition of 5000 copies. The choice belongs to the artist and obviously the scarcity of the piece and the notoriety of the artist will influence the price of the NFT.
The actual ownership is managed by the blockchain, which means that anyone can see the details of any NFT transaction and immutably prove ownership rights. The value of NFTs is subjective and therefore fluctuates, as in the case of a work of art, a rare vinyl for example. NFTs therefore essentially allow artists to sell premium collectible content to their fans.
NFTs also radically change the economics of art, allowing artists to earn a percentage on future sales of their work. The artist who creates an NFT can decide to sell for example his work at 0.1 ETH, setting an interest of 10% on the successive exchanges of the artwork, so will continue to earn when the work acquires value and is resold.
NFTs are the protagonists of the moment and surprisingly they have been the use case that has made cryptocurrencies mainstream. TV shows are talking about it, newspapers, blogs, radios are talking about it. At the moment the main NFT markets are Art and Gaming.
NFTs & Art
The first artist to break a sales record was Matt Kane, who sold his work Right Place & Right Time, a digital artwork that changes daily based on the volatility of bitcoin prices, for $100,000. That already seemed impressive, but it’s ridiculous compared to the piece “Everydays – The First 5000 Days” by the digital artist known as Beeple, sold for $69.3 million.
Recently, the Mintable platform auctioned a physical work by Baranoff Rossiné, “Abstract Composition” (1926), and the 9 copies of the NFT digital version.
Obviously, discerning between worthy items is not easy, many of the NFTs in circulation will surely lose value.
So far we have talked about visual art but also in the music market the NFT mania is spreading.
NFT and Music
Some ‘early adopters’ were Big Boys NYC who released their album on Rarible, 3LAU and other bands released their albums as NFT through DAOrecords, but definitely the band that made the most noise were Kings of Leon, who released their latest album as an NFT version: ‘NFT Yourself Album Edition‘ which granted buyers a full digital download of the album, a limited edition Golden Eye vinyl (physical copy) and NFT collectible album artwork.
Many others approached it with different projects combining music with visual art, such as Snoop Dog who released his ‘A Journey With The Dogg‘ collection, which was on sale for just 48 hours and worth more than $100,000.
The Drop consisted of artwork representing important memories of Snoop Dogg and an original track.
Part of the profits will be used to support young emerging artists in the crypto world and Snoop’s Youth Football League.
Where and how to buy NFT
Ocean sea, Rarible, Super Rare, Nifty Gateway, Digicol and soon our own Onlymusix are some of the marketplaces where you can buy NFT. Since the purchase of NFTs is done through cryptocurrencies the buyer must have a wallet. The user will have to log in to the platform with a login and will be able to see the NFTs.
Generally to buy you need a Metamask wallet, a plugin that will act as a bridge between your browser and the Ethereum blockchain, of course the wallet must contain the tokens purchased through one of the many exchanges such as Coinbase or Binance, which allow you to buy cryptocurrencies.
The only marketplace where you can buy with a credit card is Nifty Gateway.
How to create and sell NFTs
The same platforms where you can buy NFTs are those where you can create and sell NFTs. The procedures for each platform are slightly different but all of them allow a user with minimal familiarity with the tool to create an NFT and even then you will need a Metamask wallet.
Most platforms allow anyone to create an NFT, while others are more selective, such as Super Rare, and require an interview to ensure that the works are created by real artists and are original. On Super Rare, unlike other platforms, you can only create unique NFTs and not multiple NFTs.
Generally the steps for creating an NFT are very simple:
Choose whether you want to create a unique NFT or multiple NFTs (in the latter case also the number of copies)
Upload the file, which must be less than 30mb in size.
Choose whether to put your work up for auction or give it a fixed price
Choose the percentage of interest on future sales of your work by collectors
While membership of these platforms is free, creating an NFT has a cost, which is not fixed but depends mainly on the network congestion at the time of token creation. This cost is usually a few tens of dollars. The marketplace, on the other hand, usually gets a 5% fee.
Are NFTs a bubble?
Many are currently comparing the NFT mania to the ‘Tulip Mania’, which has become a metaphor for financial bubbles. In 1637 the price of a fine tulip in the Netherlands went up to 6,700 guilders, enough to buy a large house in Amsterdam.
The tulip market collapsed shortly afterwards, with prices of the most common bulbs dropping by up to 95%.
We don’t know if the NFTs are a bubble or not, what we believe is that even if they are a bubble, they’re far from bursting and the potential for artists and musicians is definitely worth exploring.
We are at the beginning of the NFT hype and those we mentioned in the article are just some of the early adopters, in recent weeks football teams and NBA teams are also making their moves. The gaming sector is also booming, in which players can buy more or less collectable “digital objects”. Also in the TV series and film sector something is moving, the first ones is American Gods. A few weeks ago Jack Dorsey, the CEO of Twitter, sold his first tweet as an NFT, for 1,630.6 Ether, equivalent to 2.9 million dollars.
Freely quoting the words of a cryptocurrency expert Lark Davis who compares the NFT rush to the gold rush: if you are buying NFTs to resell them for cash remember that most gold miners went broke during the gold rush, but the companies that sold the picks and shovels made huge profits!
The First NFTs Marketplace for Music Industry
THE I is developing the world’s first Music NFT marketplace: Onlymusix. The platform will not only allow artists to create and sell NFT works, but also to organise live streaming and share audio or video content, giving fans the chance to support their favourite artists.
Discover more: www.onlymusix.com