NFTs or Non-Fungible Tokens are a new way for digital creators to monetize their digital content, from rare Pokémon card collectibles to digital artworks to viral memes and even songs. You can essentially tokenize the existence of any real-world item on the blockchain to make trading your assets a lot more efficient with a reduced risk of fraud. The blockchain stores the proof of ownership for all NFTs by creating a digital certificate with a unique, nearly impossible-to-fabricate signature.
Why NFTs are considered worthwhile investments?
The asset’s copyright ownership, uniqueness, and reselling prospects make it extremely valuable to collectors as its value can increase over time. NFTs have garnered explosive popularity among the ultra-wealthy collectors as owning an unalterable digital asset is a priceless commodity. To collectors, they hold the same value as limited or first edition items.
Furthermore, the uniqueness factor of the assets adds to the value, making them highly valuable to anyone interested in them as a money-making endeavor; this is also a significant reason why they are considered a good investment. They were first only available on the Ethereum blockchain but looking at its rising popularity, other blockchains such as FLOW and bitcoin cash now also support NFT transactions. You can sell bitcoin cash, FLOW, or Ethereum coins to get your hands on your desired NFTs.
It’s completely normal to feel apprehensive about investing in a new asset. To make it easier for you, we have put together a couple of reasons why we think investing in NFTs is a smart move. Continue reading to find out
Five reasons why investing in NFTs is a smart move
Complete ownership of assets
Probably the best benefit of NFTs is that digital creators still hold copyrights over their content even after selling it – this is a massive win for the creators as it’s unusual for most license agreements to include such a favorable clause. It implies that creators can make money off their artwork or creation without compromising their copyrights. Furthermore, the proof of ownership is the primary reason why investing in NFTs is a good choice, as you can link the ownership of any asset to a particular account on the blockchain network. Most importantly, NFTs cannot be divided among several owners since they are indivisible. The ownership privileges of NFTs also minimize the risk of buying counterfeit NFTs.
Each record present on the blockchain is unique in and of itself, and as NFTs get created on a blockchain network, their uniqueness and authenticity are undeniable. Furthermore, NFTs are a rare, one-of-a-kind asset class with a unique signature, making them hard to forge and fabricate. Hence, each NFT creator or seller can sell these assets in a limited amount to add value instead of selling in bulk, as it can harm the asset’s value. Due to their uniqueness, NFTs holds unlimited potential. By investing in NFTs, you get a hold of an asset class that increases in value, plus the unique asset you hold, the greater your profit.
As blockchain is a decentralized network, the marketplace for NFTs is also free from third-party regulations. As a result, digital creators can leverage the NFTs to profit from their creations directly. For instance, artists require an agency to market their art to potential buyers, but NFTs eliminate the need for third parties. The buyer and seller exchange money directly with NFTs, followed by verification on the blockchain. It provides further benefits to the NFT creators as they can receive a fee every time the NFT gets traded.
Nobody can modify the token’s metadata. It can’t be edited, lost, or deleted from the blockchain. The decentralization of the blockchains means that the records get stored on a network of nodes worldwide, with each node having an identical database record. Even when the blockchain is down, the record still exists.
Furthermore, as the data on the record remains unchanged, the NFTs are meant to last as long as the blockchain network exists. As a result, they’re highly desirable as both a collectible and an investment.
Ease of asset exchange and transfer
Many invest in NFTs due to their financial potential, as reselling them has proven to be a lucrative path. The resale value of NFTs can be a substantial source of profit for investors. For instance, the initial buyer can buy low and sell high due to the immense resale value of these assets. Furthermore, the ease and efficiency of trading assets and the liquidity option in different asset classes make them even more attractive to potential investors.
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It is safe to say that non-fungible tokens will be a major player in the world of e-commerce in the future. They are already seen as an exciting new asset class for those interested in crypto. NFTs offer numerous benefits, making them a very attractive asset class in your investment portfolio. In addition, these benefits have become attractive selling points for a wide range of buyers and resellers. They offer a win-win situation for artists and resellers since the creator can earn royalties from every exchange, and the reseller can profit off the added value. Its benefits clearly demonstrate the enormous potential NFTs hold as a core part of the crypto movement.