NFTs have seen a massive increase in popularity over the past few years, and along with their
growth in popularity has been their potential usefulness to businesses, both small and large.
What is an NFT?
In short, NFT stands for non-fungible token and is a digital asset that exists on a network of blockchain. Because NFTs exist on the blockchain Ethereum, their prices are tied to the price of the cryptocurrency, making them highly volatile. Originally, their purpose was to verify digital artwork and serve as certificates of authenticity, and if you can buy and sell NFTs and with skillful strategy, you can make money off of them.
How are Big Names taking advantage of NFTs in business?
Big names are tied to big events and big products, and since NFTs can’t be replicated (non-fungible), it’s an opportunity to monetize off of the internet’s most iconic moments. For example, Twitter CEO Jack Dorsey sold an NFT of one of his tweets on Twitter for a whopping 2.9 million, and Lindsay Lohan’s NFT “Single” sold for an astounding $85,000. Tom Brady is also starting an NFT business, and even auction houses like Christie’s are taking advantage by selling them for hefty prices.
Future Business Plans regarding NFTs
There are a number of different ways that businesses, both small and large can take advantage of using NFTs. One case could be even something like NFT owners offering up their assets as collateral for a loan. NFT’s regarding a specific business or company could also be used as a verification of an exclusive club, giving rewards to its members. For example, Mark Cuban is looking into using NFTs as tickets for Dallas Mavericks games, so that they could earn royalties on ticket resales.
How your business can go about selling NFTs and making profit
NFTs aren’t for every type of business or business model, but if you do decide that your business could benefit from selling them, here is the basic process. In order to create the NFT, first you have to mint it. This process is simply turning the piece of digital art into a part of the Ethereum blockchain as a public ledger. If you wanted to make an NFT photograph of yourself for example, you could use a service like OpenSea, Rarible, or Mintbase to turn the photo into an NFT. However, there is typically a fee to perform this, upwards of $1,000. After the NFT is minted, then you can sell it. Typically these same platforms act as marketplaces to buy and sell NFTs, so you can just list the price that you think someone will buy it for, and then ideally it sells and you make a profit.
Risks and Potential Problems
There are some risks associated with NFTs however. The price of the NFT is very speculative, and will rise and fall overtime and potentially depreciate. Also, there have been instances of NFTs disappearing, because the third parties that it relies on to operate and maintain weren’t functioning properly. If the hosting service containing your NFT takes your NFT down for example, it can no longer be accessed at all. NFTs can be a very valuable aspect of your business, but can also be potentially dangerous. It is important to understand the role that they will have in your business, and if they are the right business venture for you.