Most people now have a passing knowledge of blockchain and cryptocurrencies like Bitcoin. Even more, people understand the concept of limited-edition art and artist prints.
NFTS are a combination of all these things but is also a new concept in its own right. This article shows how popular digital artists like Beeple, Grimes, and Bosslogic have capitalized on this decentralized concept! If you want to be the next Beeple or Grimes, then this article will point you in the right direction.
What is an NFT?
N = Non
F = Fungible
T = Token
It is a digital market space that is a ledger of who owns digital art; it is a decentralized ledger that uses blockchain technology in the same way Bitcoin does.
You can take a piece of your digital art and add a token, which is some form of signature or identifier. You then own this art. The tokens are non-fungible, which means they cannot be exchanged or replicated. So, there is a specific token for each piece of digital art.
This means that an artist can prove ownership, they can then sell it, and it now has collectors’ value. Sales are usually made with one of the main cryptocurrencies, like Ethereum.
It is also possible that sell-on fees can be added, so each time some art is sold, the creator gets a cut on top of the original sale they made.
For example, every time the crypto art is sold, the artist could get a 10% commission or whatever was agreed upon when listed for sale. The percentage is up to the artist but can’t be changed after the first sale.
This is amazing for digital artists as their art pieces could sell multiple times in one year and each time they get a deposit of crypto in their crypto wallet!
Are you a graphic designer or digital artist? Perhaps it’s time to get involved!
Who is buying NFTs?
There are 3 main types of people buying NFTs
- Crypto Lovers = it is a statement of a person’s love of cryptocurrencies, and NFTs is a natural extension of that love. They believe in the concept of crypto technologies, so they are far more likely to want to buy/use any similar technology/process that lives in this crypto world.
- Investors = anything that has proof of ownership can be sold, and that value can increase. The rarer something is, the more collectible it can be. NFTs are relatively rare as a whole currently, but even if they become widespread like normal art, they will still be relatively rare because each piece will have its own unique NFT.
- Art Lovers = some people are just lovers of digital art and are willing to spend money to own a piece they like, just like any “normal” art lover.
Who is making NFTs?
Anyone can make digital art and have an NFT attached to it, and the concept of Digital Art NFTs has been around a while, but it is only now that they have started selling for large amounts of money. So, they are now getting reported on more.
Famous Digital Artists and Celebrities are the only ones selling NFTs for large sums at the moment, but that will likely change.
Some NFT notable examples:
- The artist Pest Supply has sold over $1m of digital art in 2021
- A Nyan Cat sold for $590k
- A clip of Le Bron Jones dunking a basketball sold for $208k
- Grimes sold $6m worth of art in less than 20 minutes
- Beeple made over $3.5m from the sale of one collection
- Logan Paul sold $378k worth of highlight videos from a YouTube stream
If you think this all sounds stupid, then don’t; it is something that has been going on for decades in one form or another. It is no different to you paying more money for a poster of Tyson Fury that has been signed by him to paying even more money for a signed glove he used to knock down Wilder.
Things have always held different amounts of perceived value depending on how rare they are or what that means to the person who wants to buy them. This is also true for the movie poster collecting world.
Should you buy NFTs
Why should you pay money for something that you could watch on YouTube, screenshot, or download?
Well, why should you buy the Mona Lisa when you could buy a poster of it? It is all about owning originals, limited runs, and collectibles.
Digital art is just the same, you are paying for the signature that is behind the token rather than the art itself.
So, if you are investing in a piece of digital art, you hope the value of the NFT increases. If the actual artwork becomes more popular, then great, but really it is down to the demand for that token.
As NFTs are in the infant stage, celebrities are the biggest draw at the moment. Logan Paul is one of the pioneers of this, using his brand value to his YouTube subscribers as a means to create demand and, therefore, value for his digital art.
Recently he made over half a million dollars from selling Pokemon card images with his likeness. If I did the same, I probably wouldn’t sell a dollars’ worth because there is no demand for my digital images, so there is no money to be made yet.
That is why known artists and celebrities are the main people making money from NFTS currently. As long as Logan Paul gains popularity, then the NFTs he sells should increase in value. If he gets caught having sex with a minor and gets canceled, you are probably left with nothing.
So the celebrity NFT market is currently very volatile.
NFTs is a fascinating field, and it is something to consider, especially if you have a lot of spare money and aren’t bothered about losing it, as you could get into NFTs early, and you could end up making a fortune if it takes off.
I do think there is a good chance it will take-off because it will attract the people that are already into things like Bitcoin.
However, it might also attract people who think they missed the boat with Bitcoin and see getting into NFTs early as an opportunity they can’t afford to miss again.
Final thoughts
Currently, NFTs are a risky strategy for investment because they are in their infancy. However, if they take off, there is likely to be a lot of money to be made before the markets become flooded.
I would guess it will become as commonplace as buying a limited-edition watercolor print or a sculpture as we become more and more digitally bound.
However, as it becomes commonplace, it will be harder to make wise investments, just like it is hard for everyone to make good investments in traditional art. Some people will be good at it, and some won’t.
Here are the top marketplaces where people collect NFTs and sell NFTs.
If you are more interested in making your own Digital Art, you may want to check out our free Photoshop tutorials at the Poster Grind YouTube channel. Here you will learn all sorts of helpful digital art techniques which can be applied to your NFT art masterpieces!