I’ll tell you why.
I’m obsessed with Bitcoin.
To me, it’s the only fully decentralised economic tool of empowerment the masses have now adopted, where governments can’t intervene. It also continues to be a solid bet for the future.
I get it.
It’s hard to watch people buying NFT ape pictures for absurd amounts of money, making a mockery of any fundamentals blockchain technology is trying to develop.
It’s making an already speculative space look ignorant.
And you’re right; 98% of current NFTs are worthless. A considerable amount are even scams.
Where the conversation gets interesting is the 2% of NFTs that aren’t worthless.
When NFTs arrived on my radar, I stuck around and tried to make an objective decision.
You think to yourself, let’s not repeat the pattern of denial. 56% of Americans still deny Bitcoin is a legitimate store of value.
But these things take time.
Similarly, denying the new Technology on the block would be ironic without dipping your finger in the soup bowl for a taste test.
Understanding this helps you know its value.
Put simply by Gary Vaynerchuk;
“We will own things digitally the same way we own them physically”.
This doesn’t mean sitting on your imaginary couch in the metaverse. I mean digital assets that represent real-world items.
Gucci will release a product and give you the option of holding the NFT while your physical product is claimable.
(Rally Road has already started tokenising physical assets).
You’ll desire to hold the NFT because of the social signalling.
You have far more people who see what you get up to in a digital online world than your real-life experiences.
More people will see you online even if you’re Beyonce, who sells out stadiums.
Your NFT is also a ‘smart contract’ in which the creator can add value anytime.
Gucci could decide that your NFT doubles up as membership to an exclusive club, giving you access to events, future drops, or even royalties.
Your NFT now becomes an asset that you 100% own and can sell on secondary marketplaces, like Opensea and Lookrare.
They’re like the eBay of NFTs.
Here’s where the conversation becomes interesting, and I’m sticking with my Gucci example.
Gucci can add a royalty for each secondary sale of the NFT.
Every single time your NFT sells, it sends Gucci a royalty.
While I’m not exactly excited about Gucci’s profits, the part that does excite me is what the Technology does for the creator economy.
Great artists are now doing art in NFT form and getting paid royalties in perpetuity instead of selling their physical art pieces, and 20 years later, the person who sells it receives all of the upsides.
Up-and-coming artists can now monetise their work without the friction of getting into traditional art houses.
Because NFTs are Non-Fungible-Tokens by definition, something that can’t be copied or replicated, counterfeit art is non-existent in NFTs.
(Conceptual or derivative pieces are entirely different)
The innovative contract capabilities of NFTs are currently heavily weighted to art and collectables, but in the future, they may represent.
It’s worth saying that Bitcoin started the NFT craze we see today because the first ever NFTs were created on a hard fork of Bitcoin called Namecoin and Counterparty.
Here are two highly sought-after Bitcoin NFT projects;
These NFTs are the holy grail for historical collectors because bitcoin was ground zero when it came to NFTs.
Still, the Smart Contract capability of Ethereum, whose base layer of Technology is more expressive, meant NFTs catapulted on their blockchain.
Unless you tell people you have 3 Bitcoin or take a screenshot of your wallet balance like one of those cringe twitter influencers, no one will know.
Humans have an innate desire to signal who we are and attempt to project this into the world.
We do this by the clothes we wear, how we shape our beards, how people wear makeup, what cars we drive, and the watches we wear.
NFTs are a signalling tool but on steroids.
Experienced Crypto Investors over the last decade have made uncomfortable amounts of profit from investing in Cryptocurrencies. But they’ve never had an avenue to signal wealth apart from a screenshot of a Bitcoin balance.
Not until now, anyway.
People use NFTs and their innate desire to signal who they are in the world. No different to someone who drives a fancy sports car.
We are signalling our success to the world.
Being watched is one of the most basic and straightforward social interactions for you and me.
Over 100 years ago, Triplett performed a study that showed children wind in a fishing reel faster when they are in the presence of another child than when alone.
Since then, several studies have shown how audiences cause changes in our behaviour and underlying brain activity.
There is a long tradition of research into how our behaviour changes when we are alone vs when we are in the presence of others. And on camera, if we expect to be seen by many people.
Zajonc performed a series of studies where cockroaches, rats, monkeys, and humans showed changes in behaviour when in the presence of a member of the same species.
“It has been proposed that the presence of conspecifics (own species) increases arousal and facilitates dominant behaviours in both cognitive and motor tasks.”
NFTs have an art element layered on smart contracts and blockchain technology which, for the first time since blockchain’s inception, gives us a tool where we can signal who we are to the world.
It gives us this;
The adoption curve is a framework that shows how various people adopt Technology.
NFTs are earlier than Bitcoin in the cycle of the adoption curve.
Still, due to a more mature Web2, social media sites like Facebook, Twitter, and TikTok have accelerated information and intern their adoption.
Bitcoins adoption has accelerated at a hefty pace. However, the difference in the curves’ steepness between the two charts is entirely different.
Here are Bitcoins:
Here is the adoption curve for NFTs:
In other words, NFT adoption is occurring faster than Bitcoin adoption because of technological advancements and access to information.
Here is how technology adoption has increased in speed as Technology has advanced. The slopes steepen as we move through time.
Here is how we accelerated in adopting new technology from 1920 to 2011.
The final steep straight line is the Smart Phone.
In the same way that early adopters saw Bitcoin on the horizon, NFTs have their time in the limelight.
Now you understand what’s on the horizon.
The only question you need to ask is why can’t it be both?
Bitcoin and NFTs.
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This article is for informational purposes only; it should not be considered financial, tax or legal advice. Consult a financial professional before making any significant financial decisions.
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NFTs | Crypto | Web3 —Twitter: @jaydenlevitt | Email: email@example.com | LinkedIn https://www.linkedin.com/in/jayden-levitt-aa93511b
If You Love Bitcoin but Hate NFTs, You're Completely Missing the Point – DataDrivenInvestor
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