NFT as an Ideal Investment
A non-Fungible Token (NFT) refers to a digital asset, which exemplifies the transaction value of various items such as game characters and game attributes, artwork, music, videos, and more. These items are represented by tokens that can be bought and sold using cryptocurrencies. Cryptocurrencies and NFTs are run by the same decentralized database technology known as a block chain.
The NFT has a unique identifier, and the encoding of these digital creations and assets result in a scarcity of availability. These are a few reasons why NFT, unlike other non-crypto currency assets, do not guarantee an abundant supply. While other digital content assets continue to dominate the market with endless supply, NFTs are rare and difficult to access.
Revenue opportunities created by NFTs
Non fungible tokens, like cryptocurrency, rely on decentralized blockchain database technology to record ownership status and transaction data. NFT is tangible and intangible, it includes game characters, game skins, game content, music, digital artwork, videos, collectibles, virtual characters, GIFs for fashion items from designers, designer sneakers, rare to non-existent accessories. They may represent an item sold as FMCG.
Digital Content such as tweets, were of unique value and sold as NFTs. NFTs are like valuables on a collector’s shelf. The only difference is that the digital tokens powered by the blockchain’s distributed ledger are stored and protected to protect ownership.
You will find that your favorite consultant has many NFTs for unique skins and game characters. All NFTs have a unique attribute that allows companies to purchase certain in-game characters and generate revenue streams. NFT provides a great opportunity for content creators and digital asset producers to monetize their work and establish a brand through irreplaceable ownership.
Internet of Assets
NFTs solve some of the problems that exist on the Internet today. As things become more digital, there is a need to replicate the properties of physical items such as rarity, uniqueness, and proof of ownership. Not to mention that digital goods often only work within the context of their product. For example, you cannot resell iTunes mp3 that you have purchased, or you cannot redeem loyalty points from one company for credit from another platform even if there is a market for it.
- A copy of a file, such as .mp3 or JPG, that is identical to the original.
- Digital asset ownership records are stored on servers controlled by the organization – you have to listen to them.
- Businesses with digital goods need to build their infrastructure. For example, an application that issues digital tickets for events generates its ticket exchange.
- Platforms, such as music streaming services, retain most of the profits from sales.
An Internet NFT:
- NFTs are digitally unique, none of them being alike.
- Every NFT must have an owner that is public knowledge and can be easily verified by anyone.
- NFT is compatible with anything built with Ethereum. One NFT ticket for an event can be traded on each Ethereum market, for a completely different NFT. You can exchange a piece of art for a ticket!
- Content creators can sell their work anywhere and access the global marketplace.
- Objects are used in surprising ways. For example, you can use digital artwork as collateral in a decentralized loan.
Taxation of NFTs in India
It was proposed in India to roll out a digital rupee in one year and to levy a 30% tax on the income from the source like transfer of virtual digital assets like cryptocurrencies. NFT is one of the most notable technology and business federally oriented budgets presented by New Delhi.
New Delhi has proposed withholding tax on payments made in connection with the purchase of virtual assets to capture details of all such transactions.
Future of NFT?
NFT has enhanced media visibility and special perks for artists just starting with social media. Recently, Jack Dorsey, CEO, and co-founder of Twitter, with his first and famous tweet, “I just set up my twttr”, and Vignesh Sundaresan, known as “Metakovan”, bought for $69.3 million in NFT art on Beeple.
With the growing popularity, people are now willing to pay hundreds and thousands of dollars for NFTs.
Well, it’s an interesting platform with a technological change, in which transactions can be made more easily and efficiently, that is still not regulated by the government. But the government may soon enact rules and regulations to take effect. NFT is very interesting, you can make NFT from anything, even GIF, JPEG but it has to be unique and there has to be demand for you to survive in this market. It’s still early, in my opinion, NFT is the future.