How Logan Paul Made Millions Selling Air (NFTs)
If you thought that Bitcoin, GameStop, and Dogecoin were confusing, let's talk about non-fungible tokens, or NFTs, and their exorbitant values.
Hello and welcome to my newsletter!
This tweet popped up on my Twitter timeline. Logan Paul made 5 million dollars in two days selling a video clip which can be downloaded by anyone (legally). I was intrigued but didn't care much.
In the following days, my twitter timeline flooded with tweets about NFTs. And then the founder of Twitter put his tweet up for sale as an NFT.
Yes. That “tweet” is for “sale”. Buy it here if you want to.
What is an NFT?
NTF stands for a "Non-fungible token". It has to do with cryptocurrencies. Don't panic. “Non-fungible” more or less means that it’s unique and can’t be replaced with something else. For example, a bitcoin is fungible — trade one for another bitcoin, and you’ll have exactly the same thing. A one-of-a-kind trading card, however, is non-fungible. NFT is not used as a payment method in the way cryptocurrencies like Bitcoin and Ether are used. Fungible things like a ten-rupee note can be replaced with another ten-rupee note. Even two Bitcoins are the same. But two NFTs will never be the same. Anything digital can be sold as an NFT — art, music, and even tweets.
People consider this a collecting artwork. But, You can copy a digital file as many times as you want, including the art that’s included with an NFT.(you can literally save the file in your camera roll even though some other person paid a million dollars to own it!)
But NFTs are designed to give you something that can’t be copied: ownership of the work. To put it in terms of physical art collecting: anyone can buy a Mona Lisa print. But only one person can own the original.
Whats the point?
NFTs can work like any other asset, where you buy it and hope that the value of it goes up one day, so you can sell it for a profit. It is an investment for many. Also, you now support many digital artists by buying their works that otherwise might not be much of a market for. Digital artists finally have the power. And the best part is NFTs also have a feature that pays the artist a percentage every time the NFT is sold or changes owner.
A blockchain company has bought a piece of Banksy artwork worth $95,000 and burnt it and converted it into an NFT. Reportedly, that's actually more valuable than the original artwork.
Can I sell one?
Yes. Anyone can sell an NFT. There are several marketplaces that have popped up around NFTs, which allow people to buy and sell. These include OpenSea, Rarible, Nifty Gateway, but there are plenty of others. You can now list your collection for sale but keep in mind, first time sellers will need to pay a gas fee – Ethereum blockchain transaction cost – before listing anything.
Hatem Hachana told Finance Magnates that in the cultural field, NFTs “add a layer of authenticity to the object, expressing how artists intended for their [creations] to be published. With the nature of NFTs, it solves the problem of artists getting paid, as creators can be paid royalties each time a collectible is sold,” Hachana explained further. “Purchasing NFTs, is investing in culture.”
Exciting times.
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Sources and references:
https://www.theverge.com/22310188/nft-explainer-what-is-blockchain-crypto-art-faq
https://thewire.in/the-arts/nft-art-burning-banksy-art-cryptocurrency
The title has been taken from this video (spent 3 days to come up with an original title. mission failed)