When it comes to the emerging trends of 2021, NFTs are always on the tip of our tongues. Although they’ve been around the crypto sphere since 2014, last year’s when they broke into the mainstream, making everyone talk about them.
NFTs can be many things, from digital art and music to in-game assets, movies, and even internet memes. But what exactly are NFTs, and how would you explain them to your less-crypto-savvy peers?
That’s precisely what we’re going to take a deep dive into today.
What are they exactly?
NFTs are non-fungible tokens that are part of the blockchain. They are non-interchangeable units of data stored on a blockchain that can be traded or sold. They can be associated with digital files such as photos, audio, videos, or a combination of these three.
Let’s discuss the concepts of “fungible” and “non-fungible.” Cryptocurrencies, just like physical money, can be traded or exchanged. That makes them fungible. One coin of a certain cryptocurrency has the exact same value as another coin of the same currency. On the other hand, NFTs are quite the opposite; non-fungible. Each NFT has a digital signature, making them unique. Unlike crypto, no two NFTs are alike.
NFTs give their holders full ownership over that particular, one-of-a-kind digital asset. The only way to explain this further is by using an art parallel. If you’d be lucky enough to own the “Mona Lisa” or Van Gogh’s “The Starry Night,” you would know for sure that you are the sole owner. There might be many cheap knock-offs of these masterpieces worldwide, but there is only one original of each. The same concept can be applied to NFTs. You own the original one, no matter if there are other versions of the same out in the world.
NFT use in the gaming industry
NFTs have also found their applicability in the gaming industry, as they can be used to allow the ownership and transferability of different in-game assets. These digital assets can be anything from skins and visual upgrades to name handles, avatar clothing and weaponry, and any other power-ups that gamers can use to upgrade and customize a player’s persona.
As such, these tokens become special collectibles that users can gather, sell and cash in real money, or trade for new ones.
Gaming is already a super exciting and rapidly evolving industry. When you throw NFTs in the mix as well, you’re adding an extra layer of exhilaration for players worldwide.
The rise of the play-to-earn model
The emergence of NFTs made way for a new gaming experience, the play-to-earn game model. In P2E games, players can win crypto tokens by fulfilling specific in-game tasks and showcasing their skills. On top of that, they have the opportunity to get NFTs that can be used within the game’s ecosystem.
For example, Win.com will offer gamers the chance to play and compete in skill-based games and earn both NFTs and crypto rewards. It’s a compelling way to have fun and get rewarded for the time and effort you put into your gameplay.
But that’s not all there is to it! The play-to-earn model isn’t exciting only for the players; it’s equally interesting for game developers too. NFTs open wide the doors of game monetization, allowing developers to have a constant stream of revenue from the games they create. Just think about it. By integrating crypto rewards and NFTs in games, developers give room for more gamification opportunities, which pay off by generating more revenue streams for them and gamers alike.
Looking back at all we’ve unpacked about NFTs, one thing becomes clear. They are shaping up to be a critical part of the future of gaming. No wonder why everyone around you ( including us) is talking about them so fervently.
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