NFTs: Are We Creating Value? A Look At 3 Major Players
Ari Zoldan | Jun 20, 2021 01:12AM ET
Besides cryptocurrency, another asset class that is gaining prominence and quickly becoming a part of many people’s lexicons is NFTs. From art and music to GIFs and tweets, the so-called digital assets, or NFTs, are being sold for thousands or even millions of dollars.
Are these digital assets really worth millions of dollars? How can one gain exposure to these assets without actually buying these assets?
What are NFTs?
Non-Fungible Tokens, or simply NFTs, are digital assets representing an image, a video, song, or any other type of digital file. NFTs are made on the same technology that cryptocurrency works on.
A data unit is stored on the blockchain, certifying that a particular digital file is unique and therefore not interchangeable. NFTs can be bought and sold on various platforms like OpenSea, SuperRare, Nifty Gateway, Foundation, and NFT Showroom.
Every NFT has a contract attached to it, which includes information, such as, the amount of commission that the seller gets when the NFT is resold, any royalties relating to the licensing of the art, or multiple owners of the said art.
The concept of NFT is relatively new to us, which has also raised the question of fraud and the safety of these digital assets. Even with these problems, it has allowed creative industries to alter how they sell their art, providing them a platform and an accessible medium to market those digital assets.
How is the NFTs industry shaping up?
According to the NFT report published by news release mentioned that “WISeKey will enable the direct connection of satellites to IoT devices for NFT authentication, completing the connection cycle from space to device through secure telecommunication means.”
Aside from its core business, the company is a direct beneficiary of a growing NFT market.
2. Atari
The maker of classic video games like Pong, Centipede, and Asteroids is foraying into the NFT market. Atari (OTC:PONGF) is licensing casino games and has expanded its offering by launching its own cryptocurrency, Atari Coin.
The company announced a strategic partnership with Bondly, a digital asset solution provider, to launch NFTs covering games, music, and other areas.
The company’s goal is to establish a new gaming platform (Atari Metaverse) by combining these NFTs. Atari is leveraging its gaming brand and expertise of Bondly to position itself in the NFT market.
3. Dolphin Entertainment
An entertainment marketing and premium content production company, Dolphin Entertainment Inc (NASDAQ:DLPN) is forming a new division to design, produce and release NFTs for itself and its clients in gaming, television, music, and other industries.
The company owns several PR firms in the movie and music industry.
Dolphin has announced partnerships with the Hall of Fame Resort Entertainment Co (NASDAQ:HOFV) and Elite Holdings LLC to make and promote NFTs associated with H2H legends.
There are many other companies that have seen a massive run-up just based on expectations and rumors of their entering the NFT market. One such company is Takung Art Co Ltd (NYSE:TKAT).
Aside from these small and micro caps, the NFT market is also attracting mainstream companies like Cloudflare (NYSE:NET). The company recently announced that its stream will now support NFTs. The creators will be allowed to embed NFTs into their videos on the Cloudflare stream.
Conclusion
The NFT market has attracted the attention of many investors and influencers. There are also many skeptics highlighting the pitfalls of the growing technology, labeling it as mania. The industry is in a nascent stage and is bound to attract speculators along with genuine investors; this does not mean that NFTs are just a bubble.
There is no denying that this technology has generated value for creative industries like art and music and is changing the perspective of owning different assets.
The application of this technology is expected to grow out of the realm of digital assets. As clear regulations start to take shape, the NFT market might one day be recognized as a conventional asset class, having a place in most portfolios.
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