Non-fungible tokens (NFTs) emerged as a cultural storefront in the cryptocurrency space last year, and now institutional investors are following so-called millennials and Gen Xers into the space.
“The influx of institutional investors into the blockchain and cryptocurrency industry was inevitable,” Ryan Wilkinson, co-founder of Blockasset, the athlete NFT ecosystem, said in an interview.
NFT brings new possibilities in the curation and circulation of art and shakes up the endorsements of popular celebrities in a fascinating way. Nike, Sony and Disney are some of the trendsetting organizations as mainstream players are capitalizing on the rock star appeal of next generation technology.
While cryptocurrencies are based on cyberpunk politics that undermine surveillance and financial exclusion, NFTs decentralized approach to ownership of digital creative content and technological innovation is a more specific youth-driven blockchain pitch.
Wilkinson said the non-fungible token market is growing in much the same way that decentralized finance (DeFi) is growing in 2020, with sub-demographic groups of Millennials and Gen Xers driving growth. Nearly 50% of millennials reportedly hold digital assets.
“defi …… ‘s meteoric rise continues today as more and more people realize that it’s better to invest their money in this space than in bank deposits that can barely cope with inflation,” Wilkinson said.
“However, in the beginning, defi wasn’t as widely recognized as it is now, and the same is true for NFTs,” he added, pointing to Snoop Dogg and Gary Vaynerchuk’s mainstream endorsement of NFTs.
He also mentioned Visa’s recent purchase of a Cryptopunk NFT for $150,000 as “a meaningful signal of acceptance” that will attract purchases from other institutional investors who, until now, may have considered similar assets to be “speculative.”
A non-forgeable token is an immutable and unique unit of data stored on the blockchain.NFTs can be used to represent items such as photos, videos, audio and other types of digital files.
In a new report, research firm Global Data notes that institutional investors are entering the NFT space to better commercialize their patents. Kiran Raj, Global Data’s lead disruptive technology analyst, explained in a statement.
While the trend of patent filings in the NFT space has been going on for some time, things are getting more interesting in terms of using NFTs to represent patents, which could bring transparency and liquidity to the global IP market, which is often challenged by the large gap between patent filings and commercialization.
“Real-life use cases are critical for NFTs to maintain growth beyond the hype. using NFTs to represent patents is one such case that can boost the future of NFTs as it can be a game changer for the IP industry by bringing transparency and providing liquidity that would otherwise be placed on the balance sheets of companies,” Raj added.
Traditionally, the opacity of ownership issues and the lack of standardized management and valuation of assets has limited IP transactions, with $1 trillion of IP never traded, according to IPwe, an IP expert. The transparency of blockchain-powered, non-windowed tokens is attractive to institutional players entering the space.
“NFTs can help better commercialize patents when people own them as NFTs, given their blockchain-powered immutability and the nature of the source. Once patent rights are transferred, they can provide patent holders with full ownership,” the global data report said.
In July, Disney filed a patent to use the blockchain to manage and track ownership of physical objects such as toys, pins, collectible figurines and trading cards, as well as their digital counterparts in the form of NFTs.
By designing the patent as an NFT, each patent’s license can be customized by custom coding the records into smart contracts and contract terms. This is advantageous to companies, especially small and medium-sized businesses, because it allows intellectual property to be used as collateral for the value of an organization seeking funding.
Emil Angervall, COO and co-founder of Corite, a platform that allows fans to invest in artists, predicts that NFTs new cultural use case is a decentralized way to distribute and monetize music rights. He told us.
Music and artists have the ability to provide a key component of valuable NFTs: they are collectibles, similar to the original vinyl prints, and they can provide larger-than-life experiences, such as access to backstage.
According to Angervall, NFTs are a potential game changer for the $16 billion music industry, as the technology opens up decentralized ways to finance music projects for institutional investors like Visa and the fan crowd.
“Once more institutional investors see the potential of this space, fundamental changes in the music and creative industries will accelerate. NFT has the potential to become as important to Gen Z as video was in the heyday of MTV in the 90s, which will undoubtedly attract institutional investors,” he said.
Global NFT sales peaked at more than $2.8 billion on Sept. 6, but have since slowed to $1.8 billion on Sept. 29.