The Enduring Value of NFTs on Algorand: A Critical Role in the Future of Finance

  • Large scale participation and price discovery events to drive revenue
  • Having long term confidence in the digital scarcity they have created
  • NFTs create provable and inherently authenticated digital ownership
  • NFTs are an on-chain representation of the ownership of value. The value itself can be represented in the NFT (e.g. embedded data), external to the NFT like digital-native items (e.g. in game items), or off chain entirely (e.g. real estate or IP rights). Easy analogies to the traditional world are the title to your house or a ticket to a concert. The title is not the actual house, but the record of ownership for the house and the ticket is not the actual seat at the concert, but rather the record of ownership for that seat at that particular concert. An NFT, or on-chain ownership record, is represented by a token therefore takes on highly valuable characteristics such as

Programmability.

For example, the NFT could programmatically not be allowed to be transferred without satisfying a royalty payment.

Divisibility.

For example, NFT ownership can easily be fractionalized to increase addressable market or to raise additional funds

Transferability.

Provability.

Authenticity.

Cost and ease of NFT creation and management impact business models:

Core blockchain functionality impacts market depth, price discovery, and liquidity discounts

Ease of transacting is the final input to market friction.

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Idykristech

Idykristech

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