Lately, the big thing on everyone’s minds seems to be what is NFT art and how they’re some of the most talked-about things in 2021.
Simply, Non-fungible tokens (NFTs) are digital art pieces sold on NFT marketplaces for millions.
While there are starving artists who have seen the worst ends meet during the pandemic, there are NFT artists that reached the $50 million threshold.
Does this sound too good to be true? Let’s see what is NFT art and what is its true potential.
Potential of NFT Art – Let Me Tell You Something Funny!
Evaluating artwork is almost impossible regardless of what it is.
Neither NFTs nor classic paintings have a cut and set price tag. Also, there’s a lot of variables for both of these.
For instance, the value of the artwork depends on its popularity and the creator.
In addition to that, there’s also the competition factor of who wants it more than the other.
Let’s just say, it’s extremely easy to raise the price tag of artwork if there’s two men battling it out for who gets it.
Talking about paintings, let’s see how much they can be worth.
Although there’s a list of masterpieces that have been sold for hundreds of millions of dollars, here are some comparable paintings.
- A Girl In Flowers, 2017 by Paul Insect – $30,000-$50,000
- Royce – Fashion is Art by Dietmar Scherf – $100,750
- 2796 Multiple Personalities by Charles Cham – $21,000
These paintings are created by fairly popular artists who have been known to create wonderful art.
Even though they’re not as popular as some of the paintings created by artists like Da Vinci, they are modern-day NFTs like these:
- Metarift by unknown artist – $904,410
- Crossroads by Beeple – $6,600,000
- CryptoPunk #6965 by Larva Labs – $1,540,000
You see, these are some of the most popular NFT arts. So, they may be on the higher end in the NFT market.
There’s a lot more NFT artwork that lies in the range of $10,000 – $100,000 and some as low as $10 – $1000.
It’s similar to how prices of these paintings are decided based on the art as well as the artist.
So if you’re lucky, people will bid higher on your artwork. Likewise, you will also also be left without any buyers at all.
Can’t People Copy & Paste NFT Art?
You’re probably wondering, didn’t you just put these images here for free? Well, that’s the thing!
Everyone can just get these images from the internet and download them.
For instance, the costliest NFT, Everdays: The First 5000 Days by Beeple was sold for $69.3 million and you can easily download the image or individual images from the collage for free.
The catch is – NFTs allow the buyer to own the original artwork.
These art pieces have built-in authentication to act as proof of ownership. Essentially, the collectors who buy these NFTs give more because of the bragging rights that come with it.
Another comparison can be made with paintings to explain why people buy NFTs.
As collectors of paintings like to show off their collections, NFT artists can also do the same. Isn’t it weird that normal people can just have a photo of the painting or artwork for free? Yes, it is but that’s what it is.
NFTs are also great for investments like cryptocurrency. For example, you can buy NFTs for a cheaper price and later sell them for a higher cost to earn a bit of profit without being the original owner.
In conclusion, NFTs are a matter of collecting various artworks for pride and show-off for some people. Whereas, others buy it as an investment.
Has this discussion made you curious about the working of NFT? Let me tell you how NFT would work out for your art!
How Does NFT Work for Your Art?
NFTs typically exist on a blockchain called Ethereum.
Primarily, blockchains are distributed public ledgers that record transactions similar to how cryptocurrency works.
NFTs are not just supported by Ethereum but by other blockchains as well. However, it remains to be the most common and popular one.
As far as the creation of actual NFTs go, they are created from digital objects that represent tangible and intangible items. The more accurate term for this is “minting.”
NFTs can be minted from the following items:
- Videos of any kind
- Virtual Avatars & Video Game Skins
- Designer Sneakers
- Miscellaneous things like Tweets
The last item is probably the most confusing one, isn’t it?
According to Twitter co-founder Jack Dorsey, it wasn’t. He sold his first ever tweet as an NFT for over $2.9 million.
In a similar fashion, NFTs can be any collectible item like physical objects. The only difference is, they get such a digital version of it that has authentic ownership proof.
By the way, NFTs also have the ability to store any specific information inside them. So, an artist can sign the artwork or write anything in its metadata.
How Risky is NFT Art Business?
With these complications and just a general weird nature of NFTs, there are also few risks involved.
Similar to how cryptocurrency has several threats, NFTs can also be subject to frauds and scams.
Considering how much money is involved in NFTs, it’s not a surprise that there are people who wish to benefit from doing shady things in the NFT market.
Here’s a list of several scams and threats of the NFT art business that creators and buyers should be vigilant to.
1. Replica Stores
There’s a huge amount of replica stores that exist online to trick the users by looking exactly like famous marketplaces.
Furthermore, the scammers create these replica stores to mimic original websites in terms of the overall design, look, and functionality.
This also makes the users think that the website is original and they end up using their credentials or payment information, giving them to the scammers.
2. Fake NFT Marketplaces
Similar to the replica stores, the fake NFT marketplaces are fake websites that try to catch buyers into spending their money on NFTs that don’t even exist.
The creators of these fake marketplaces don’t use logos or designs of other notable stores but instead go for non-affiliated elements.
In the end, the users get fake NFTs that are non-existent and spend on content that is not verified or authenticated.
3. Counterfeit NFTs & Artist Impersonations
Recently, there has been a slow rise in the number of copyright issues regarding counterfeit NFTs.
These NFTs are heavily inspired or straight-up copied from other artwork or content that don’t belong to the creator.
This has led to several trademark and copyright issues which have caused a lot of money to buyers of the counterfeit NFTs.
Additionally, it’s tough to verify sellers on such online marketplaces, users need to be careful of what they buy.
4. Fake Giveaways/ Airdrops
Users should be aware of giveaways and airdrop scams that have been going on recently.
Besides, there are thousands of these that go live every month, promising free crypto, NFTs, or tokens.
Usually, scammers target NFT and crypto enthusiasts by giving them fake hopes to get sensitive information.
So, you should watch out for these giveaways that usually are run on social media platforms like Facebook, Telegram, Twitter, or Discord.
5. Brand Impersonations
Due to the extremely volatile nature of crypto and NFT, there are several communities on social media to advise users about the happenings in the trading world.
Among these, there are several scammers that set up groups on Telegram and Facebook under the name of famous brands like Rarible.
These scammers pretend to be a part of official support or community to perform several frauds.
Users and NFT enthusiasts should strictly avoid these groups that can entice you to do something or give some information that you shouldn’t.
Even if you plan to do so, verify that the group is actually original and a part of the real brand.
You should also be aware of scammers that will try to sell you fake and non-existent NFTs for real crypto money.
Along with this, we also expect to see more fraudsters that would make themselves more subtle and undetectable.
Is NFT Art Worth it for Artists & Entrepreneurs?
After all that we discussed, it’s fair to disregard or reaffirm your decision to buy or sell NFTs.
Regardless, the future of NFTs is still uncertain and the industry is still very young and in its primal stages.
So, it may or may not be worth investing in it. Let’s divide the NFTs for 2 types of users:
NFTs For Artists
Starting with the creators and artists who will sell the NFTs, it is a much safer answer.
Yes, it’s definitely more on the ‘worth it’ side than the other. You’re not likely to spend a significant amount of money in creating the NFTs, which means you will not be facing huge losses.
It’s important to note that the price for your NFT art is completely dependent on circumstances.
If there are more people willing to buy your artwork, you will have more bidders and as a result, more money would come.
Overall, there isn’t much doubt about the worth of NFTs from an artist’s perspective.
NFTs For Entrepreneurs
What’s not easy to determine is the worth of NFTs for investors or entrepreneurs.
As we said earlier, the NFT market is still young and it’s challenging to see where it will go in the near or distant future.
So, there is a likely risk of facing losses on what you buy.
If you’re simply looking to broaden your collection, it’s not such a bad idea to buy NFTs.
Contrastingly, if you want to buy them and sell them at a higher rate, there is a major risk involved.
You have no way to guarantee that what you get for the NFT will always be higher than what you paid for it.
It’s almost like investing in cryptocurrency and the stock market. On a fine day, you could make several times more than what you paid.
Or, you could even get way less than what you anticipated.
Either way for artists or entrepreneurs, we suggest you to try the NFT market slowly in small quantities.
A good start would be to invest the amount of money you will be okay to lose completely.
In the case of artists, you can give it a try by creating 5-10 NFTs and seeing how it goes.
Finally, we reached an end to this awesome discussion about NFT.
It’s an amazing time to discover NFTs and investing in them as the market is likely to grow further.
Artists are also getting a chance to earn a huge amount of money and creating a ripple into the art world that may even turn into a massive wave!
But remember, make sure to stay updated. The faster it can go up, the faster it can go down as well.