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What To Expect From What Is The Most Expensive NFT Ever Sold?
What To Expect From What Is The Most Expensive NFT Ever Sold?
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Why are NFTs so expensive  

Line as the source of value Is NFT money real zip fresh. Kanye West force out deal a t-shirt for $120 because he’s Kanye West. Opine how a great deal he could betray the tweed t-shirt he wore on arrange for a present. Belle Delphine’s bathwater is sold come out at $50 (NSFW site). It doesn’t affair that we behind purchase a t-shirt for $5 or construct our possess dingy bathwater. Ancestry matters.

Why NFTs are Valuable  
The Beeple "Number 1 5,000 Days" NFT sold for $69,000,000 cobbler's last workweek. Naturally, that's rearing around eyebrows about what the purchaser very bought.  
Obviously, How do I make my NFT account free the purchaser doesn’t own the artwork in any traditional gumption. Look, I hind end paste it correct here: 
And ahead you aver "you butt do that with a picture to a fault!" That’s non quite a admittedly. A show of a house painting is different from the house painting. The JPG of the Foremost 5,000 Years firearm is the piece. There’s no difference.  
This is ace problem with the possession moot about NFT graphics (presentation for the unfamiliar). You don’t have the nontextual matter the Lapp way of life you might have an original Picasso. You can’t ruin it, you can’t change it, you don’t truly ascendance it in whatever peculiar means.  
Only that’s the thing with NFTs, you’re not buying the artistic creation. You’re purchasing the NFT. The NFT is non the graphics. It’s a few lines of codes that includes a reference book to the art, but that’s it. The art doesn’t evening hold up in the NFT since it would be means besides much information to place on the Ethereum blockchain. Completely the NFT has is a link up to where the graphics is!  
I could go hold some other NFT of the accurate Sami piece of music of artwork good now, and no one and only could very kibosh me. Merely it wouldn’t be worth anything. Why non?  
Well, for one, it wouldn’t rich person an authentic origin. It's highly gentle to control whether an NFT came from Beeple or non. In fact, it's significantly easier to do this with NFT artistic production than with "real world" prowess since everything on the Ethereum blockchain is legible. Wholly Beeple would give birth to do is twinge the public come up to he's signing his artistic production from and and then anything of his that's sign by whatever early speech we'd make out is faker.  
Line as the seed of respect is goose egg freshly. Kanye West privy deal a t-shirt for $120 because he’s Kanye West. Guess how practically he could betray the blanched t-shirt he wore on stagecoach for a prove. Belle Delphine’s bathwater is sold come out of the closet at $50 (NSFW site). It doesn’t subject that we can buoy buy a t-shirt for $5 or throw our ain soil bathwater. Parentage matters.  
You mightiness cerebrate of an NFT not as the art, but as the signature on the art. Historically you had to own the forcible patch to get the signature. In real time we toilet abstract the signature tune into its possess asset, and you bottom buy the creator’s self-declared sealing wax of authenticity.  
Another analogy Hera is a college arcdegree. Tutorship at Andrew Carnegie Mellon is $57,119 per class. At the last of Little Joe years, you take in a firearm of paper. Is that while of newspaper publisher deserving $228,476? You could hardly photoshop your mention into this unity and bid it a day:  
But it’s non the art object of paper, it’s the stemma of the composition and what it tells multitude. The key signature matters. It tells people you washed-out 4 geezerhood and plenty money to keep 65 lives from malaria learning… something. Hopefully. And consequently they should give you Sir Thomas More than the differently undistinguishable bookman a few miles away.  
The cost of a level is non around cognition or the friends you made along the mode. Those could be had for far to a lesser extent money. It’s more or less sign. Sign you were militant and flush sufficiency to start out into this institution, and and so contain your tear drinking comfortably enough to survive for quaternity age.  
The college grade exists someplace on the spectrum betwixt "utility" and "signaling." And unitary reasonably consistent Sojourner Truth with the public utility company to sign spectrum is that as things catch more expensive, we ordinarily incur ourselves finisher and finisher to the sign goal of the spectrum.  
The $5 t-shirt is thoroughgoing utility program. The Kanye t-shirt is most totally signaling. Everything we buy, and own, falls somewhere on this service program to signal spectrum.  
So where are NFTs ripe immediately? Right hand here:  
NFTs are fascinating in division because they engage the usefulness to signaling ratio to the extreme point. In that respect has never been something so valuable that’s so perfectly useless. Tulips you could at least engraft. In that location is in effect naught public-service corporation to owning NFTs that are on the marketplace properly now, likewise speculation nearly their succeeding economic value.  
So on the far side speculation, wherefore are they worthful? Signaling. There are some 240,000 single wallets with over $1m USD in Bitcoin. If you dead came into a few milly, you’d wanna appearance murder too. NFTs are a diverting fresh elbow room to signalize wealth and penchant.  
Just they’re besides a path to sign how early on you are in the crypto economy. If you bargain into the theme that NFTs bequeath located a raw monetary standard for digital rights management and extremity ownership (which I do, more than on that following time), buying some nowadays is sort of comparable buying BTC vertebral column in 2013 or registering a 3-alphabetic character world diagnose in the early on years of the network.  
And to be clear, I utterly dearest NFT engineering and How do I make my NFT account free am departure to spell around it a great deal more than. I’m not pointing verboten their highschool bespeak to substitute ratio to criticise them. I’m pointing it come out because I call up they’re being unfairly criticized for organism a liquidate of money. Sign is extremely valuable, and NFTs are a enchanting raw means to peacock butterfly and mayhap fetch rich people along the means.  
So are NFTs a burble? I dubiousness it. NFTs are acquiring scores of push just the grocery is silence minuscular in the grand piano schema of things.  
The nontextual matter grocery is worth  
67 billion dollars. The NFT grocery store lonesome hit 338 1000000 in 2020. Perhaps it’ll bang a few jillion this twelvemonth. Simply then constituent in how very much easier it is to bargain NFTs than art, and how many other industries NFTs could corrode aside at, and that 67 1000000000 list good sounds comparable a starting period.  
For example, sports product. Roughly of the money acquiring dog-tired on NBA merch is today aerodynamic into TopShot. TopShot has done at to the lowest degree a few centred 1000000 in proceedings so far, which sounds insane until you think back that NBA merchandise, which has no speculative investment component, is a nigh 50 zillion buck industriousness.  
Or comparison NFTs to other crypto options. Bitcoin’s marketplace cap is all over 1 billion. If there were a Beeple-sized, $69m cut-rate sale every one Day for a year, the NFT securities industry would soundless be alone $25b, or 2.5% of the Bitcoin securities industry. It is Too soon.  
Patch I don't suppose NFTs are a bubble, I conceive at that place are very much to a greater extent interesting habit cases for NFTs that aren't existence through with in time. Uses that will study them beyond mere signaling, and yield them roughly novel forms of service program that weren't antecedently conceivable online.  
Erst we start up beholding Sir Thomas More of those use of goods and services cases arrive, the market will equitable stay to originate.  
This clause primitively appeared as an test in my Monday Pastiche newsletter, which you prat signaling up for here

"We're sightedness a unexampled coevals of traders inside the NFT market; the great unwashed who are digitally indigen looking for for extremity aboriginal asset classes out of doors of effected asset markets," Ivanova said. "These are populate who undergo accumulated report and wealth and require to invest it in purely virtual assets same NFTs."

What are NFTs?  
NFTs are non-fungible tokens — import you couldn't switch unmatchable NFT for another — that scat on a blockchain network, How do I make my NFT account free a digital book that records altogether proceedings of cryptocurrencies the likes of bitcoin.  
The divergence with bitcoin and early tokens, though, is that each NFT is unparalleled and can't be replicated. From each one unmatched accrues treasure independently. Crypto investors suppose NFTs descend their prise from How do I start selling NFT barely they are. They're stored in appendage wallets as collectors' items. Beyond artistic production and sports, multitude undergo besides establish uses for NFTs in practical genuine acres and play.  
Nadya Ivanova, chief operational officer of BNP Paribas-attached search business firm L'Atelier, says collectable appendage assets rump be view of as a amend rendering of an MP3 lodge. Musicians undergo struggled to earnings from their cultivate in the extremity age, and Ivanova says around are turning to NFTs to leaven ownership of their influence and find out an additional rootage of revenue.  
"It's allowing content creators to really possess the holding rights for what they create, which allows them to benefit from it in dissimilar shipway which they can't do with strong-arm art," she told CNBC, adding that crypto nontextual matter is the strongest growth subsection of the appendage collectibles marketplace.  
The add up appraise of NFT minutes quadrupled to $250 zillion finis year, according to a learn from NonFungible and L'Artist's workroom. The act of digital wallets trading them about double to terminated 222,179, while just about traders were able-bodied to take a crap winnings of all over $100,000.  
"We're visual perception a fresh propagation of traders within the NFT market; people WHO are digitally native looking for How do I make my NFT account free for integer indigene plus classes alfresco of firm asset markets," Ivanova said. "These are the great unwashed World Health Organization make collected repute and riches and need to seat it in purely practical assets alike NFTs."  
Ivanova says the NFT grocery has been maturing. Celebrated auction house Christie's auctioned an NFT-based make of fine art created by Beeple, How do I make my NFT account free a well-known digital artist WHO has created videos and art for celebrities like Ariana Grande and Justin Bieber.  

What was it virtually this art that made it so heatedly contended? The sales event of the art came with or so interesting features:

Appendage art: What are NFTs and why are they so worthful?  
How do you ascertain evaluate? Intelligent around this today as I interpret spattered crosswise the media news show near a digital graphics that sold online for US$69.3 jillion. Instantly that's a really expensive JPEG register. What caused the cost to reach out such reckless heights? Provide and demand, scarcity value, freshness factor, line-shooting rights? In the sheath of this art potentially a compounding of altogether of the to a higher place.  
The artist Mike Winklemann professionally known as “Beeple” was non comfortably known external of the digital artistic production universe. Directly he is unrivaled of the just about expensive keep artists you had in all probability ne'er heard of. Until today.  
Christies was the auction sale theater that sold his artwork and whilst they bear an unbelievable pureblood in marketing art which dates backwards to the 1700's, this was the foremost fourth dimension they or any former John Major auction off family had sold a tack of prowess that was alone extremity (with a NFT). I translate that they themselves were uncertain of how to prize the spell. Its mediocre to enounce the auction off went selfsame well, it was a phonograph recording breaker, and judgment by the artist's chitter feed he appears to be astonied by the last damage nonrecreational.  

.@beeple 's 'The Foremost 5000 Days', the 1st strictly extremity NFT founded nontextual matter offered by a John Roy Major auction bridge firm has sold for $69,346,250, positioning him among the summit triplet near valuable support artists. Major Thanks to @beeple + @makersplaceco. Sir Thomas More details to be discharged shortly — Christie's (@ChristiesInc) Butt on 11, 2021

What was it all but this nontextual matter that made it so heatedly contended? The sales event of the artwork came with about interesting features:  
Sold with a Not Fungible Souvenir.  
Strictly extremity graphics.  
A compilation of 5,000 soul artworks.  
Cut-rate sale treat managed by ane of the near venerable vendue houses, How do I make my NFT account free Christies.  
Cryptocurrency was an accepted shape of payment.  
Until Tuesday this hebdomad I had ne'er heard of NFT's or Not Fungible Tokens. Crypto up-to-dateness? Yes. Blockchain? Surely. NFT? Nope. I set up stunned more or less them by take chances when get together with a job cooperator he mentioned NFT’s to me. "NF what?" I queried. He patiently explained the conception and how NFT's could be applied to assets so much as artworks and euphony victimisation blockchain engineering. I was interested to discover around it simply wondered where had I been entirely this time? He believes NFT's are the future expectant thing, but his opinion, perfectly not advice!  
The put down producing artwork by Beeple is coroneted “Everydays: the first of all 5,000 days", a digital asset compiled of 5,000 individual artworks. If the new owner(s) decide to sell the artwork in the future it will have to be sold as a whole, they will be unable to siphon off individual pieces to sell. Whilst the artwork is a rich tapestry of thousands of pieces the owners will be able to zoom in on each individual piece, so it can certainly provide them with some viewing variety.  
Everydays — The First 5,000 Days, by an artist named Beeple, released by Christie's (Christie's Via AP)  
There is no doubt in my mind that an important part of the value of the artwork was that it was sold with a non fungible token or NFT. The NFT is essentially a digital trademark providing proof of provenance and ownership. With the use of a NFT authenticity of the asset is forever assured; using blockchain technology the token will be stored on a digital ledger. Should the artwork change hands in the future the NFT would go with it providing an important safeguard that this is the original piece, helping combat the risk of fraud and forgery. This can be a serious and expensive issue in the art world which is well covered in the popular BBC television series “Fake or Fortune”.  
It is easy to understand how a NFT can provide safety to buyers and sellers, particularly important for digital art which can be easily replicated. It will be fascinating to watch from the sidelines to see How do I start selling NFT the use of NFT's develop. No question that we really do live in interesting times.  

Deutsche Bank suffered a similar shock in 2015 when a junior member of the bank’s forex sales team accidentally transferred a hedge fund $6 billion, but luckily for the fledgling member of staff, the hedge fund was kind enough to send it back.

What are NFTs?  
NFT stands for “Non-Fungible Token.” Non-fungible essentially means it cannot be traded in for something else, in the same way a $50 dollar note could be traded for two $20 dollar and one $10 dollar note.  
NFTs are sometimes compared to art pieces like paintings (because there will only ever be one original) but they’re also regularly compared to autograph prints, collectibles, and trading cards. Whichever traditional, real-world analog is closest, they are effectively digital certificates of ownership.  

NFTs can contain smart contracts — which run on the Ethereum blockchain — which could, in theory, give the original creator of an NFT a percentage of all future sales of the token.

Why are they so expensive? Scarcity, first of all, but the marketplace in general — and the subsequent price of NFTs — is driven by the momentum and sentiment floating around this young, exciting new asset.  
Who knows How much do NFT cost expensive NFTs will get — or, conversely, when the bubble will burst.  

Swiss IT security company Wisekey has also moved into this business. “Digital twins for luxury items and art are the main markets so far, but other uses of NFTs are emerging, in particular for certifying intellectual property and identity,” says CEO Carlos Moreira. The company provides NFTs to protect luxury objects and has recently launched an art marketplace. It plans to introduce its own cryptocurrency and is working on projects for digital rights management of music and movies.

NFT explosion: Why are people buying digital art?  
You are free to share this article under the Attribution 4.0 International license.  
Built on the same technology as Bitcoin, NFTs have been a hot topic in 2021. They enable a real market for digital works of art while fueling unprecedented speculation.  
2021 might become known as the year when digital art exploded. On March 11, a cryptocurrency investor paid $69 million for the digital painting “Everydays: The First 5000 Days” during an auction organized by Christie’s. The blinking GIF Fomo is currently for sale for $2 million—60 times what it sold for only nine months ago. And a series of 10,000 straightforward-looking illustrations of monkeys, called the Bored Ape Yacht Club, are collectively worth more than one billion dollars.  
This mind-boggling bubble is fueled by the NFT technology, which enables cryptocurrencies such as bitcoins or ethers to be exchanged against digital objects. An NFT or “non-fungible token” is a digital data string that establishes proof of ownership of a specific item that usually exists in the virtual world. It could be, for instance, a digital work of art, a financial asset, or a patent.  
NFTs live on the blockchain, a transaction-tracking decentralized ledger, which until recently was mainly known for being behind Bitcoin. It has generated incredible hype while extending its potential impact on many industries, from finance to art, music, intellectual property, and luxury goods.  
NFTs and royalties  
“NFT has really enabled a market for digital art,” says Robert Zumkeller, a graphic designer who started creating NFT illustrations while a student at the FHNW Academy of Art and Design in Basel. “I am not certain that I would have found a brick-and-mortar gallery willing to exhibit my digital work, nor buyers who would acquire a physical screen to own it. With NFTs, I could use an online gallery, Superrare.com, to showcase my work and sell it.”  
Like everything else recorded on a blockchain, art NFTs allow for tracking all transactions after their initial sale. This tracking allows for a perpetual royalty payback, explains Zumkeller. Under his moniker, Vicarivs, the young artist will receive 10% on any subsequent sale of his work—something that rarely happens with physical objects sold by galleries or collectors.  
In physical art, only one original copy usually exists (or a few dozen, in the case of art prints). The original is distinguishable from reproductions, which are sold legally or as forgeries. With digital painting, the work of art is a data file, which can have an infinite number of perfect copies. That is why an NFT does not comprise the data file of the work of art itself; instead, it functions as proof of original ownership.  
Digital versions of luxury goods  
NFTs have also entered the luxury market, where recently, digital twins (a photograph or a 3D animation) of collector watches went up for auction in spring 2021. “More and more brands are looking into NFTs,” says Serge Maillard, managing editor of the watch magazine Europa Star. “First, as a useful tool to fight forgery by ensuring traceability and authenticity. Second, to develop and maintain a closer, more personal relationship with their client, without having to rely on intermediaries.”  
Swiss IT security company Wisekey has also moved into this business. “Digital twins for luxury items and art are the main markets so far, but other uses of NFTs are emerging, in particular for certifying intellectual property and identity,” says CEO Carlos Moreira. The company provides NFTs to protect luxury objects and has recently launched an art marketplace. It plans to introduce its own cryptocurrency and is working on projects for digital rights management of music and movies.  
Altogether, the NFT market ballooned over the last twelve months with a 700% increase from the second to the third quarter of 2021, according to the analytics platform Dappradar. This bubble confirms the speculative character of cryptocurrencies and blockchain applications; namely: the dollar value of the bitcoin has increased by a factor of 100,000 over ten years.  
Speculation and impact  
“So far, design choices on the technology have helped to fuel speculation,” explains Claudio Tessone, professor of blockchain and distributed ledger technologies at the University of Zurich’s department of informatics. “The most widespread systems are based on the so-called proof-of-work, where the validating and tracking of all transactions by the network as well as the introduction of new tokens only work because users run computations on their systems.  
“As the devoted resources have been accelerating under a constant rate of supply, the creation of assets is becoming more and more expensive, which fuels an increase of their value, just like oil prices going up when it’s harder to extract. In turn, this creates incentives to invest resources in the blockchain, which fuels a self-reinforcing loop driving speculation and inflating prices further.”  
The energy consumption of blockchain applications has been an increasing worry. While society is desperately trying to tackle climate change, it has simultaneously introduced economic services that consume as much electricity as a middle-sized country like Sweden. “There is some hope that a new architecture for blockchains, called proof-of-stake, will make the electricity needed to run it negligible,” says Tessone. “A new generation of platforms such as Cardano, Polkadot, or Tezos are already running on such systems, but their impact—while increasing—has been limited so far. We’ll have to see.”  
However, this new architecture could generate new, problematic incentives. Until now, cryptocurrencies rewarded those setting up huge computer farms to profit from economies of scale and more efficient energy usage. A proof-of-stake blockchain rewards users instead who heavily invest in it, which fuels speculation. “As of now, it is hard to imagine blockchain without speculation,” says Tessone. “It is good to see that the community takes this problem seriously, cryptoeconomies for a future with more functional cryptoeconomies.”  
Catherine Tucker, a professor of management at MIT who specializes in the blockchain, regrets this focus on speculation: “Most of the reporting on NFTs has been on the speculative aspects. This is rather frustrating, as it may lead to less experimentation on ideal-use cases.”  
Not so private after all  
One worry is that the anonymity provided by blockchain technology could help financial fraud. The most obvious ones are shill bidding to drive prices up at auction and insider trading. In September 2021, Opensea, the largest marketplace for NFTs, revealed that one of their employees had purchased items just before they were displayed for sale on its front page—an action that would amount to insider trading.  
Many specialists’ forums discuss the risk of shill bidding, where an artist or someone they are conspiring with buys their work for a large sum to drive its price upwards and maintain the current bidding frenzy. This culminated with the suspicion that the owner of an NFT of the art series CryptoPunk borrowed 500 million dollars as a flash loan—a financing mechanism only available on the blockchain—to buy the NFT from themselves before returning the money. While a clever trick to inflate the price of their art, this move also raised suspicions that NFTs could be a perfect tool for money laundering.  
Interestingly, specialists discovered these suspicious activities because all blockchain transactions are fully available to the public. “The famed privacy of cryptofinance is a mere illusion,” says Tessone. “It is based on the premise that users create a large number of wallets holding their assets in an attempt to obfuscate their transactions.” But in fact, many people choose to avoid this option because of the cost of transactions. And then, of course, there’s the traceability, adds Tessone: “mathematical network analysis can uncover suspicious activities, allowing tracing back transactions to a person even if they manage many wallets. This is why shill bidding on NFTs is not actually safe for fraudsters, contrary to what many commentators say.”  
Catherine Tucker also cautions us against putting the blame entirely on NFTs, saying that “problems such as insider trading with NFTs are reflections of underlying user behavior in uncertain environments and persistent transaction costs. I am not sure if attributing fault to the technology is correct. Ultimately, technology is just technology.”  

Now, as prices surge, owning a CryptoPunk has become a "digital flex" due to there being only a limited number of them. Several of their owners have also taken to flaunting them by using their punks as an avatar on social media sites like Twitter.

First and foremost, limited quality. Just like there would only ever be 21 million Bitcoin and not a single more, there will only ever be 10,000 CryptoPunks. It is up to the NFT creator if they want to have a rare collectible or have several versions of their NFT. Still, in both cases, the authenticity of the NFT is verifiable through their unique IDs and metadata.  
In CryptoPunks, no two punks are the same. Some have a headband, some have caps, others have small shades, and many are wearing gold chains. Each punk has different attributes, and some are rarer than others. Simply put, the rarer an item, the higher its value.  

After all, if you were to spend millions of dollars to buy a piece of work done by Picasso, you could hang it in a gallery and charge quite a bit of money for tickets to simply look at it. But NFTs are different. They’re digital files that can essentially be copy and pasted by anyone.

NFTs Are Unique  
First and foremost, it’s important that you understand what the acronym NFT stands for, which is non-fungible token. The non-fungible part of the name points to the uniqueness of the digital asset. These pieces of art simply can’t be replaced.  
To understand the difference between a fungible asset and a non-fungible asset, all you need to do is look at Bitcoin, Ethereum, or a wide range of other cryptocurrencies, which are all indeed fungible. After all, there’s nothing unique about a single bitcoin other than its ownership. One could be replaced with another and the owner wouldn’t mind because the value is the same no matter which coin he owns.  
On the other hand, your dog is a non-fungible asset, albeit one that’s likely a very valuable member of your family. After all, I couldn’t walk in with another dog that looks pretty much the same, take yours and leave mine, without you being upset about it.  
Your dog is unique. You know his personality, he knows yours, he gets along with your kids, friends, and family. Shucks, he’s part of the family. There’s no way to replace him.  
Not that NFTs are living, breathing, animals that become part of the family, but they are just as unique and irreplaceable as your beloved family pet; hence, making them non-fungible.  
Ultimately, uniqueness adds value. After all, value is a concept that’s built on supply and demand. When the supply is high and demand is low, value is hard to come by, but with NFTs, the supply count for each unique token Is NFT money real one! As a result, if someone wants to buy it, they’re not going to be able to unless they pony up the amount of money that the owner of the NFT is willing to accept for it since there’s no competitors to lean on when you don’t want to pay the price asked.  

Cryptocurrencies involve a significant level of risk. Prices can fluctuate on any given day. Because of such price fluctuations, you may gain or lose value of your assets at any moment.

Why are NFTs so expensive?  
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Nonfungible tokens (NFTs) burst onto the scene earlier this year when some of them started pulling in millions of dollars at auctions. A confusing and controversial new digital asset is on the rise. DW‘s own experiment selling an NFT made a smaller splash. Which made us all the more curious: Why are some so expensive?

Explained: Why some NFTs are so expensive  
Nonfungible tokens (NFTs) burst onto the scene earlier this year when some of them started pulling in millions of dollars at auctions. A confusing and controversial new digital asset is on the rise. DW‘s own experiment selling an NFT made a smaller splash. Which made us all the more curious: Why are some so expensive?  
Patrons of the arts?  
First, a reminder: NFTs prove ownership of digital files. They can represent digital works of art but Can you buy NFT on Robinhood also be associated with video game accessories, collectors items and more. Anything that can be stored as data on a blockchain can be an NFT. NFT transactions are recorded publicly on a blockchain and often bought with cryptocurrencies.  
Investment bank JPMorgan recently valued the global NFT market at $7 billion (€6.3 billion). In October, an experiment by The Economist pulled in $420,000 when the weekly news magazine auctioned off an NFT of one of their cover pages. An issue about decentralized finance, the cover art portrayed cryptocurrencies alongside images from the children’s book “Alice’s Adventures in Wonderland.” Buyer @9x9x9 told The Economist it was the fitting title — “Down the Rabbit Hole” — that compelled them to purchase the data file of the cover.  
But buyers of breathtakingly expensive NFTs point to a whole range of reasons for spending big bucks for the rights to a data file that anyone else can view or copy. Cryptocurrency entrepreneur Vignesh Sundaresan spent a record-breaking $69 million on an NFT earlier this year. The NFT enthusiast, who has invested in the technology, denied that he was trying to push up prices. He said he wanted to support the artist and showcase the technology. For other buyers, it’s about scarcity. “The buyer knows How do I make my NFT account free many will be made and has blockchain proof of ownership,” American billionaire and NFT collector Mark Cuban told online news portal Business Insider.  
What the data says  
Researchers at the Alan Turing Institute (ATI) wanted to know what the data said about this phenomenon. “What we observed is that there is this gigantic heterogeneity in the success of NFTs,” Andrea Baronchelli, associate professor in mathematics at the University of London and ATI’s token economy theme lead, told DW. “Some — very few — do very well, a bunch do decently, and the majority are worthless.”  
In 2021, ATI’s team of experts completed a study which looked at the role certain factors play in the price of NFTs. They looked at three components: the NFT’s visual features, previous sales of related NFTs and the social network of the buyer and seller. Researchers used a machine learning model to consider a dataset of 4.7 million NFTs exchanged by over 500,000 buyers and sellers. The result? Past sales of related NFTs was the most important of these three factors, accounting for over 50 per cent of the price variance.  
For example, past sales of NFTs from the CryptoPunks collection, a prominent set of 10,000 tokens depicting pixel images of punks, would be a good indicator of future sales of tokens from the same collection. Visual features were the second most important aspect. Including this data increased the performance of the machine learning model by up to 20 per cent. Data showing the popularity of the traders increased performance by 10 per cent. Combined, they concluded these three factors can explain up to 70 per cent of the variability in NFT prices. They plan to look at more factors in the future, including the platform where the NFT is sold and the activity of the creator on social media.  
An old market rethought  
In the market for NFTs of digital artworks, one can recognize something of the traditional art market, where scarcity, social networks and, often to a lesser extent, content of the art piece help determine an object’s worth. But NFTs have some features that distinguish them from their real world counterparts, Mauro Martino, director of the Visual Artificial Intelligence Lab at IBM Research and ATI study co-author, told DW.  
“A very big difference between the art market and NFTs is that the artists take 10 to 20 per cent from the secondary sales,” he said, “So anytime the piece will sell again, part of the sale will always go to the artist. This is really a novelty in the idea of art and can be a big game changer for artists.” This is possible because future sales of NFTs are recorded on blockchain, which allows artists to receive their cut automatically.  
A JPEG of a rock  
That is good news for anyone whose NFT has generated some money. But what about the majority that aren’t worth much at all? “There are 10,000 new pieces each and every day ready to go…I don’t know where,” said Martino. “There are not 10,000 new buyers every day to sustain this incredible production.” Stability in the NFT market would require greater attention from the public to attract traditional investors, as well as greater comfort with cryptocurrencies, the experts said. This development is likely still years away, and surprises could pop up in the meantime.  
“If we notice that enthusiasm for NFTs today is very similar to the enthusiasm for cryptocurrencies at the very beginning, then we can expect some major correction,” said Baronchelli. This would have unclear implications for this nonfungible asset. “If I have Bitcoin and it goes down 40 per cent, I still have 60 per cent,” he said. “If I have a JPEG of a rock? What happens to the value of that JPEG? We don’t know, because there is nothing similar.”  

As more financial advisors are learning, NFTs are starting to catch on, even among non-celebrities. And it may not be long before a client asks you how to include NFTs in their portfolio.

Why NFTs are so appealing  
Simply put, people love collectibles. And thanks to the growing accessibility of NFT marketplaces, the title of "collector" now applies to someone trading free Space Jam tokens just as much as it does to prominent figures like the pseudonymous Whale Shark, who owns more than 220,000 pieces of digital art and has consulted Paris Hilton on how to break into the market.  
As a financial advisor, your first priority is to look out for the long-term financial security of your clients. It might be helpful to think of NFTs the same way you would a rare stamp collection, for instance, or a signed original manuscript of the great American novel. NFTs are a lot like old-school comic book collecting, or baseball cards and Pokémon cards. Except, thanks to blockchain, their true scarcity (and value) is much less speculative because we have an irrefutable record of every token.  
Assuming your clients have a healthy amount of money invested for their retirement, a sizable emergency fund and enough disposable income that they can experiment with NFTs, collecting can be a fun and innovative way to feel a part of the future.  
But if someone isn’t in the position to invest money on speculative art – whether a hundred dollars or a thousand dollars here and there – there are ways your clients can dip their toes into the NFT market for free.



How do I make my NFT account free
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