By classifying the mainstream NFT, we observe that the scope of NFT extends far beyond traditional art/collectibles.More and more NFT projects have started to empower NFT’s diversified utilities and bring better use experience to holders.During a bear market, those NFTS made up of 100 percent speculation mostly fizzled out completely, while those with stories, utility, and community thrived.
We classify NFTS in the market according to their utility:
art
Art forms have been changing over the decades.It is now moving into the digital world, from physical to online.For artists and buyers alike, there are widespread concerns about risks such as publicity costs, resale costs and distribution, as well as the difficulty of storing and collecting — as recently happened when the Mona Lisa was vandalized and a cake thrown at her.
The emergence of NFT minimizes these risks.After all, artists can get great exposure through their work online — alongside Instagram and Twitter, OpenSea is the other major platform for artists to showcase their NFT work and gain public exposure.In addition, one of the biggest problems when buying art is whether the buyer has the threshold of high consumption power of art.With the advent of NFT, it allows buyers to offer or buy at listed prices through smart contracts.
Generally speaking, reselling works of art in the primary market is taboo, but for NFT works, this is not a headache.In addition, NFT provides many additional benefits — for example, while the artist receives royalties from the initial sale, NFT allows the artist to receive royalties from all secondary sales of his artwork and provides incentives for the royalty mechanism to remain in place no matter how many resales are made.
The art category covers many fields.Anything can be considered art.Therefore, this is why every NFT falls into one of the three categories mentioned above.
Because if it doesn’t belong to the other two, it boils down to, “Someone, somewhere, thinks this looks cool and wants to buy it.”
The point is that people see certain things as precious luxuries.Others may not see them in the same way.Everyone likes different things.Let people enjoy things.
After all, it’s not your money.Therefore, many types of NFT can be categorized as art.
PFP
PFP stands for “Profile picture,” or more commonly known as profile picture.So far, NFT PFP is only used in a few applications such as Twitter and Discord, although many other social media platforms are planning to adopt NFT PFP in their applications.Currently, the main problem with NFT PFP is that holder purchased NFT PFP can be copied, but apparently most application product managers have this in mind. For example: Twitter will validate the NFT profile image, and if it is valid, the user will get a hexagon outline;This allows the user to tell whether the HOLDER of the NFT PFP is a Holder or not, and the holder also has something to brag about.
In addition to satisfying user presentations, it can be used as a pass-like feature that allows users to become community members, DAO developers, and early investors in a potentially large project.In addition, PFP owners may have access to games or other products created by the community, or they may have access to the same series of NFTS as a celebrity.
Virtual land
NFT virtual lands are areas of digital land that can be owned on a metasverse platform.
These lands are similar to Minecraft in that users are free to create, except that the digital lands are completely user-owned, unlike Minecraft where Microsoft owns user creation.When users can own the digital land outright, there are many benefits, such as being able to use NFT land for advertising, social, gaming, work, and other use cases.
It may sound vague, but let’s explain it briefly:
- Advertising: If the user’s virtual land is located in the core (popular) area of the metasverse and attracts many visitors, the user can charge for advertising space.
Users have previously bought land next to Binance’s virtual land and charged exorbitant advertising fees. - Social: Users can host events on their digital lands, including concerts, conferences, and community gatherings, or they can build desired scenarios on their own lands.
- Games: The user’s NFT land can also be used in the NFT game.
Some games require users to own land to participate, or users can build their own NFT games on their own land - Work: Land that can be explored with 3D avatars, as a virtual office space, or as a digital service.
The game
NFT stands for digital assets such as avatars, game gear and game cards in encrypted games.The appeal of NFT lies in its uniqueness, scarcity, provability of ownership, transferability, and indivisibility, which is of great significance for increasing the value of in-game items.NFT also has embedded metadata that can be used to prove the authenticity of assets.
In fact, NFT’s first applications were games.At the height of its popularity, as many as one million Filipinos played NFT games every day, generating income that exceeded their wages and alleviating the employment crisis.With the popularity of NFT games, the variety of games has increased dramatically, from Axie Infinity (inspired by Pokemon Go) to StepN (Move to Earn) games and related apps.
membership
The term “membership” has been around for a long time in Web2.0.However, user privacy, data processing and ownership remain key issues.Membership NFT (Pass Card) can potentially transform the membership experience by addressing the above issues.First, instead of remembering a bunch of passwords for various platforms, we need to remember a wallet mnemonic — after all, the authentication logic for different platforms also validates the NFT in the wallet through a link wallet.In addition, smart contracts that connect our wallets to the back end allow us to access multiple functions.Finally, we can also be qualified to resell members in the secondary market for profit, which is much more convenient than the resale of traditional members.Some members also have access to popular item tracking, Smart Money, resource communities and other features.
social
A social NFT provides the holder with a number of benefits, including participation in online and in-person social gatherings.As NFT becomes more popular, many social networking applications are planning to use NFT as a medium.A successful social NFT project requires an influential person (Kol) with an active community.
Example: VeeFriends NFT was founded by Gary Vaynerchuk, an influential YouTuber and entrepreneur.By owning VeeFriend NFT, the owner immediately becomes a member of the VeeFriends community and gains access to VeeCon.Different VeeFriends NFT holders can participate in different social events hosted by Gary Vaynerchuk.
And governance.NFT can be used to open up artistic and commercial decisions to fans and customers, and is currently used mostly in the entertainment sector.
For example, fans who buy NFT can be given NFT to support theatrical performances in pre-production.In exchange for buying NFT, all holders of that asset get a vote on things like the color of the main character’s T-shirt, the name of the character and even the name of the show.
This is the future of fans.The fan base has a say in the projects of their favorite creators.Just like a few days ago someone built a DAO, wang Xinling, NFT was quickly robbed.Interesting things and applications will continue.
music
The fast-growing ecosystem in music NFT is also notable.Fan rewards and royalties are two significant differences between Web2.0 and Web3.0 music collectibles.
Many aim to create a more collaborative music marketplace or streaming platform.For example, despite owning the NFT of music, Sound. xyz also grants the holder a public comment on the song;Artists can classify their music into four scarcity levels at Pianity, making unique versions more valuable.As for royalties, platforms such as http://Royal.io and http://Rocki.com allow collectors to invest in streaming royalties in the form of NFT.In other words, the revenue generated by streaming will be split based on royalties that NFT holders will receive in proportion to their holdings.
brand
NFT has the potential to be a digital asset of the future, and its popularity has led brands to flock to NFT.Among these brands, Adidas and Nike are among the best.
Nike entered the NFT space through the acquisition of RTFKT (a meta-universe digital sneaker property company), where they used the latest game engine and NFT technology to create a digital sneaker such as:RTFKT designs a number of cool 3D NFT Nike shoes that allow owners to “wear” and display them on social media like Snapchat.
Adidas, on the other hand, launched its own NFT through a partnership with BAYC.The interesting use of adidas NFT is that adidas NFT owners will not only have access to the virtual world of digital Adidas, but also to physical Adidas products such as sportswear, hoodies and beanie hats.
The domain name
NFT can also be used for domain name services similar to.com domain names, but based on decentralized technology.The Ethereum Name Service (ENS) maps readable names to identifiers that can be recognized by blockchain and non-blockchain resource machines, such as Ethereum addresses.Basically, ENS resolves the.ETH domain name to an Ethereum address.ENS makes Ethereum addresses easier to remember, and ENS domains can be bought and sold on the secondary market.
Blockchain applications can also be linked to domain names (such as Mirror), with additional functions.
Defi
On Uniswap V3, the liquidity provider (LP) position is represented as NFT (non-homogeneous ERC-721 token) instead of the homogeneous ERC-20 token on Uniswap V1 and V2.
Depending on the pool and parameters selected on the flow provision interface, a unique NFT can be cast that represents the location in a particular pool.
Uniswap NFT displays the most important information about the user’s liquidity position, including trading pairs, selected tiers, Token symbols, and pool addresses.
NFT owners can modify, redeem, and even sell positions in Uniswap V3.
conclusion
If we classify NFT in the most detail, there may be dozens.Here we have selected the top 10 most representative species at this stage.NFT may look back in a few cycles with more classifications and applications unimaginable in the current phase.
Sometimes too much subjective emotion can stifle the imagination, so WHEN I was working on this article, I also expanded to think of many possible use cases.
These possible future use cases and their better forms will also be sorted out and shared in the public account/community.