Is the World Ignoring Unexplored Uses of NFTs?

September 29, 2022 by Mimi Phan

Art is great. Seeing art as NFTs is even better. But do you ever wonder what else NFTs could be used for? The NFT industry is predicted to be worth $231 billion by 2030, and this fast-growing industry has attracted a lot of users and investors. Still, people mostly refer to art when talking about them. It’s time to explore the unexplored uses of NFTs. Their potential is huge – and who knows? We might have just stumbled across the next big thing in tech! 

What are NFTs?

NFTs are digital tokens that allow users to own digital or real-world items. Usually, these items are intangible and they include plots of virtual real estate in the Metaverse, virtual company stocks, collectibles, art, etc. These tokens are built on a blockchain and are unique to their respective owners, so people cannot replicate them – this is why they are described as non-fungible. 

For example, if you buy an NFT it’s unique to you and its limited quantity makes it more valuable over time. Unlike cryptocurrencies like Bitcoin – which are fungible because you can sell them for the same value as other currencies – NFTs are non-fungible because they don’t have like-to-like values with other NFTs.  

How Do NFTs Work?

NFTs tend to exist on blockchains, Ethereum being the most popular. And this is why there are more ERC-721 tokens out there than NFTs on other popular networks like the Solana blockchain and the Binance Smart Chain. 

Like cryptocurrencies, NFTs exist as unique records on a blockchain and you can mint, buy, and sell them for profit or other reasons. But to store them, you have to use NFT-enabled wallets like Trust Wallet or Metamask. They are sold online via NFT marketplaces like OpenSea and Binance Marketplace. 

Why NFTs Matter

Seeing as people don’t mind splashing thousands of dollars on Bored Apes, NFTs have naturally become a raging topic! But they are so much more than creative pictures of apes. NFTs matter today for several reasons. 

Gaming

Normally, online games focus more on the gameplay and not much else. But NFTs allow gamers and art collectors to own unique in-game items and collectibles like costumes, avatars, game cryptocurrencies, etc. They become recognized owners of these valuable items and can sell them for real money. NFTs also hold virtual worlds also known as metaverses together while promoting community building. 

Filmmaking

Hollywood has been undergoing a silent revolution, since filmmakers have turned to NFTs for project funding. Such filmmakers can expand their reach and sell their films directly to a global audience on NFT marketplaces. In other words, NFTs eliminate the need for giant production studios and agent commissions. The film creator can also program royalties into the work and get a cut every time it’s sold to someone else.

Investment 

Apart from the common method of holding and selling NFTs when their value increases, NFTs provide investment opportunities in the decentralized finance (DeFi) world. DeFi applications (dApps) allow users to borrow and lend money. Borrowers can put up their NFTs as collateral when borrowing because they’re seen as Web3 assets. 

Music

Music NFTs are a huge market that’s only growing – through NFTs, musicians are able to connect and engage with their audience in a way that’s never been possible before. Access to bonus tracks, live performances, remixes, playlists and VIP promotions are just some of the benefits afforded to an engaged and interactive fanbase, while musicians themselves get an unprecedented chance for wider exposure. Pushing the envelope all the way, there’s even a potential for fans to actively collaborate with their favorite artists on new albums.

Fashion

Like other areas, the main potential here for loyal fashion fans is from a VIP access perspective. Get to see the new season’s clothes before anyone else, collaborate with designers, take advantage of discounts, early access and admission to exclusive events. Dolce & Gabbana, Nike, Adidas, Zara…all fashion brands who have made massive moves in Fashion NFTs and set their sights on the billions in projected revenue opportunity for the global metaverse market.

Future of NFTs

Many people question whether NFTs are the next big thing or another investment bubble that will eventually burst. Experts also have divided opinions about NFTs. But despite the different views, what’s certain is that individuals and businesses are entering the NFT space and investing big. 

Right now, the industry is evolving with many new projects daily. They are helping people monetize many items we never believed we could make money from – like in-game items such as avatars that are seemingly valueless. 

But what are the possible capabilities of NFTs that people are yet to explore fully?

1. Identity 

The digital identity sector can benefit greatly from what NFTs offer. If people get to store and own their identities digitally, they can increase their privacy and securely save their data. 

For example, NFTs can improve self-sovereign identity (SSID) that has been around for a while. With NFTs, you can connect everything related to you online to your digital identity – from social media accounts to collectibles, and other items – to prove that you own them.   

2. Domains 

Ethereum Name Service (ENS) domains which work like regular web domain names are common in the Web3 space. You need to pay a fee to create your crypto-related username and decentralized website. But sometimes, people buy domains and resell them for more money.

Interestingly, NFTs can also transform how this works since people can create ENS NFTs and sell them whenever they wish for profit. According to a report, Ethereum domain names are some of the most traded NFTs on OpenSea. If more people tap into the ENS NFT space, it’s only a matter of time before it goes mainstream.  

3. Community Building 

Another underexplored NFT use case is its ability to connect people and build community ecosystems with rich engagement. Like marketing in the real world, every brand or project needs an audience, and community members need one another to stay informed and solve problems. This is where NFTs come in!

With NFTs, brands can promote such conversations and connect people with shared interests. For example, an exclusive platform like Mint helps brands create NFT communities where people can share their experiences, but can only join the platform or interact on it using branded NFTs. 

Such platforms also create an ecosystem where people can easily engage one another, buy and sell NFTs, and support each other under a brand’s name. 

What will happen to NFTs in the future?

NFTs are among the hottest topics in the DeFi space today – thanks to their numerous use cases and investment opportunities. But certainly, there’s still so much more ahead in the project’s future! From creating stronger communities to making money from personalized adventures, it will be exciting to see where NFTs take us as it evolves.