NFTs are here and they will not be going away any time soon. By now I’m sure you have some rough idea what they are and, if you are like me, are still in disbelief that JPGs are selling for millions of dollars.
Is that all NFTs are? This is the question that has been nagging at me ever since watching License Global’s WTF NFT with speakers Trevor George, Zach Bruch, Cuy Sheffield, and Gary Vaynerchuk. Gary was the one who presented this question of other utilities of NFTs. Now there is no question crypto art is booming and will continue to do so for a while but then what? With the advent of in-game purchases and digital currency, there is little doubt that NFTs will be implemented in video games going forward. In fact, I believe NFTs are going to eventually be a huge part of video games and the inevitable metaverse. In-game ad-ons are a pretty obvious utility of NFTs but what else? On the ethereum.org website, there is a section about different uses for NFTs and they are as follows; Digital content, video game items, domain names, physical items, and investments/collateral. It is these last two categories that will introduce far more people into this space.
Ethereum.org states “because NFTs are essentially deeds, one day you could buy a car or home using ETH and receive the deed as an NFT in return (in the same transaction).” That paragraph goes on to imagine a not-so-distant future where you unlock your front door with some sort of cryptographic wallet. I personally find the nuances of NFTs to be both fascinating and frustrating. They are fascinating because the path going forward is being forged by the imaginations of creators, computer wizards, and everything in between. What is frustrating is wanting to be at the cutting edge or involved in the conversation of where this technology goes next. Many of us understand that this technology is powerful and important but we are limited by our own imaginations.
Another use of NFTs will be as collateral in a decentralized financial system. If current trends continue and environmental concerns can be solved, cryptocurrency will become an even more common legal tender. Taking cryptocurrency one step further you will find crypto loans. NFTs will eventually be able to be used as collateral for these loans. Who would have thought that an 8-bit image of a neon cat smoking a cigarette could help you finance your first house?
Although these other utilities may seem distant from the current licensing world, I believe these will be an expansion to the licensing world.