NFTs have been known to sell for enormous sums on the internet. So, large corporations are now getting in on the act as the tokens navigate their way into various aspects, from the art world to video games and more. With all the buzz around the new digital thing, many brands have been experimenting and creating their NFTs. It created the scope for Branded NFTs because prominent names create these.
What is an NFT?
A non-fungible token (NFT) is a data unit that cannot be exchanged and maintained on a blockchain – a type of digital ledger. Digital media such as photos, videos, and audio can link with NFT data units of several types. This way, NFTs counter cryptocurrencies like Bitcoin or Dogecoin (which also operate via blockchain), where each token is uniquely recognized.
Further, a fungible item is exchangeable for another of the same value. It is similar to exchanging $100 for another $100. So, exchanging cryptocurrencies is possible, and people do it while trading. However, the same is not possible in the case of NFTs.
How do NFTs work?
NFTs, similar to cryptocurrencies, are traded on specialized platforms. A sale does not always imply the transfer of the token’s described object. For example, NFTs of well-known paintings have been sold lately, but the buyer does not receive the actual picture. The certificate of ownership of the NFT, registered on the ledger in the blockchain, changes the owner. The certificate finds its place in a digital wallet, which can come in numerous formats.
How are Branded NFTs helping the brands?
Food like McDonald’s and Taco Bell and prominent fashion brands Gucci, Nike, and Louis Vuitton, are stepping up in the NFT market. Some companies employ NFT collectibles or limited editions to create new earnings streams, increase brand loyalty, or raise funds for charitable reasons. However, Branded NFTs can also be a means to tell a story, improve their image, or reach new audiences. These have the potential to be used for live event ticketing as well.
From toy companies like Mattel to Warner Bros, NFTs are a means to support new launches, increase social media statistics, promote anniversaries or milestones, or support a campaign. While these were a new concept last year, NFTs are expected to boom and turn into something mainstream in 2022.
Digital artworks sold for tens of millions of dollars and new cartoon images taking social media by storm – this is the story of NFTs. Major businesses and celebrities snatched up virtual property in virtual worlds, and it seems that the new trend is here to stay.