DeFi went viral for more than three months and is now gradually cooling down. NFT is becoming a hit (NFT, Non-Fungible Token, some people call it ERC-721 token). NFT is issued according to the ERC721 standard. Non-fungible tokens are not divisible, can’t be replaced. This is in contrast to fungible tokens.
According to NonFungible data, NFT’s trading volume amount, average price and total trading volume skyrocketed on September 21–22. MXC Global is the first on to launch the NFT index products. Other exchanges have also launched “NFT section”, similar to the previous “DeFi section”.
Today, the NFT market has more than $110 million in total transactions, sold more than 4.8 million NFTS with the average price of $23.36.
Though NFT is still a niche area when compared to DeFi market capitalization of $13.5 billion, or the overall crypto market capitalization of $341.8 billion, it is still considered to be the next digital gamble after DeFi.
In fact, NFT is not a concept that came out recently. CryptoKitty in 2017, Decentraland in 2018 and CryptoKicks of Nike in 2019 all belong to NFT.
On NonFungible, there are already more than 130 NFT cryptocurrencies, of which the top ten cryptocurrencies in trading volume include NIFTYMOJI, CRYPTOKITTIES, etc.
NFT goes viral for three reasons:
1. NFT is actually a supplement to “everything can be tokenized”.
If our biggest expectation for blockchain technology is on-chain in the real world. Then fungible tokens, which takes bitcoin and Ethereum as examples, is just one of its applications. Because it is not possible to record unique information in the fungible tokens, so many unique certificates, property rights and other data and asset tracking, verification, transaction is still a blank. This part of the market and infinite potential. Such as games, digital art, software licensing, real estate and so on. Based on its indivisible, irreplaceable and unique attributes, NFT is particularly suitable to be used for digital assets that need to be differentiated from each other in order to prove their value, or scarcity. In addition, its “token” attribute can also achieve asset tokenization, promote its transaction liquidity, the integration of actual and actual assets will be more closely.
2. The gamble on digital art.
The popularity of NFT in the market is linked to the sale of the digital artwork Portraits of a Mind at Christie’s New York, the world’s largest art auction house.
For the traditional art market over the past 20 years, from 2000 to 2018, the art market was more than 180% higher than the S&P 500 index. For decades, the richest people in the world have been buying art, whether for stored value, capital appreciation or pure appreciation. Because just as bitcoin is better than gold, many people also think that digital art is better than traditional art. At present, the market capitalization of traditional art is more than $60 billion, while the market capitalization of digital art is less than $10 million. The 6,000 times of the growing gap has attracted lots people’s attention.
3. The combination of DeFi and NFT
In the past week, as the MEME of NFT+ liquidity mining bucked the market and rose to a new high, MEME became the “the airdrop token of 2020”. Someone was airdropped about 600,000 tokens and was called by “forced to get rich.” NFT constantly breaks the stereotype impression of “arts, cartoon animation online pricing”. NFT + DeFi, NFT+ insurance and other new models continue to emerge. NFTs mainly include three types: 1. Platform tokens of the NFT platform; 2. Digital collectibles, digital artworks, etc.; 3. Digital version of valuable bills and income rights. Currently, the most large-scale implementation is the digital bill NFT, which belongs to a subset of DeFi, such as digital insurance policies, digital tickets, RealT’s real estate income Token, etc., which can realize value flow through remortgage. In addition, liquidity mining is essentially a reward mechanism,which can also be used on NFTS.
NFT projects at a glance:
In addition to digital assets (eg digital artworks, virtual treasures), digital certificates (eg real estate certificates) corresponding to tangible assets have already filled our lives. In order to ensure that the transfer of ownership of these assets is open, transparent and verifiable, scarce and negotiable, it is actually a good way to use blockchain technology to turn them into NFT. Maybe in the future each of us will have to become a big collector of NFT.
As the major trading platform of NFT, MXC Global has listed more than ten NFT projects and NFT ndex product.