Across the globe, NFTs are increasingly finding their way into everyday use. Beginning in February 2021, NFT began to grow explosively, with a weekly trading volume of more than 2 million US dollars, and within a few months, the total market value of large NFT projects increased by as much as 2000%.
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We wouldn't rule out Fomo sentiment, but until then, perhaps part of the reason the craze took off is the use case for NFTs manifested.
For artists, NFTs bring freedom of expression. Because they don't follow the same conventions as physical art, it may be easier for artists to create works that they have in mind, and thus more appealing.
Fungible refers to any unit that can be exchanged, such as currency.
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The "value" of any object is not defined by the amount of resources and the labor time it took to create and produce it, but rather varies according to its context and the rationale or perspective of its users. In simple terms, the value of any item depends on the individual buying or selling it.
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Popular among artists and art collectors, gamers, and large commercial brands, NFTs can be anything from artwork to game characters or gear, music, videos, social media posts, or GIFs. The possibilities and scope are endless.
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first level title
What is value?
There are two main definitions of what value means.
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secondary title
How to evaluate the value of NFT?
The value of an NFT is based on three different variables. These are called subjective sentiment, utility, and provenance.
1. Subjective emotions
Typically, value is defined in terms of the subjective or objective value of an item.
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Rather, subjective values can change and change according to the whim of the individual. Subjective means that the value of an item depends entirely on a person's beliefs, preferences, choices, or ideas.
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In any market, whether online or offline, all items and commodities have a value set according to the target consumers, consumption preferences and consumption goals. This value is based on subjectivity, just as some people who enter an art gallery will be impressed by certain artworks and make subjective evaluations of them, while some people will not think so.
This is the same for NFT art and items.
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Therefore, this subjectivity and subjective value is the basis for defining the actual value held by NFT. Everyone's perception of value is different, and some works that you think are worthless may be regarded as treasures by others.
2. Provenance
Another question that is often asked about NFTs is the issue of provenance.
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Provenance is important because it can conclusively prove the authenticity of a work of art, which can greatly increase its value. Provenance has historically been seen as the best way to verify an item's authenticity. Provenance has long been the anchor of value in the expensive goods market, and applies to the fine art, luxury and collectibles markets. Likewise, provenance also applies to NFTs.
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Those who are familiar with the NFT market can see that many artists have cooperated with major global brand companies to create and distribute NFT artworks; and some very influential stars, football stars, etc. have created a new category of wealth through NFT.
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3. Practical application
The utility value of NFT depends entirely on the practical application of NFT.
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Here we have explained in detail in previous articles, so I won’t go into details with you. everyone can review"Ten Social Use Cases of NFT"。
4. Digital Scarcity
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The idea of an open Internet has really influenced us. In a sense, NFT will indeed bring scarcity to things that are not scarce.
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The freedom afforded by the internet and social media can deplete the inventory and value of content. Once any work—which took a lot of time and effort—is on the Internet, the marginal cost of copying it is zero, and the price of the work is essentially zero. This means that, no matter how much effort is put into it, no one will pay for the work. Given the circumstances, more scarcity does have benefits.
in conclusion
in conclusion
As we have seen, NFTs are truly valuable commodities.
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The provenance of these items is easily traceable, allowing previous owners to be identified and better able to increase the value of these items.
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NFT Labs provides relevant information only and does not constitute any investment advice.
NFT Labs provides relevant information only and does not constitute any investment advice.
