NFT — Crypto Derivatives As New Investment Instrument
The development of technology creates new instruments as a tool for investing. The types of investments that are commonly used are stocks, property, mutual funds, deposits, bonds, insurance, gold, and precious metals. Now there are many other options for investing, including crypto and NFT which are becoming hot topics of conversation.
In the past few months, Ghozali’s name has become a trending topic in Indonesia because he managed to reap billions of rupiah in profits from NFT. “Ghozali every day” is a collection of Ghozali’s selfies from 2017 to 2021 which he deliberately collected, then made into NFT. Ghozali sells his selfies on one of the largest NFT marketplaces, OpenSea.
But what exactly is NFT? What kind of work can NFT say? Because there is still a lot of confusing information on this topic, in this article, we will discuss more NFT.
What is NFT?
NFT stands for Non-Fungible Token, which is the only digital asset that can be owned. Simply put, NFTs represent valuable or unique items with irreversible exchange rates. This NFT is not interchangeable but can be traded. NFT uses a blockchain network with unique and distinct identification codes and metadata, so they cannot be duplicated.
NFT itself is a derivative product of crypto. In contrast to cryptocurrencies, NFT is considered as a single whole token itself, so in principle, all assets can be used as NFT. Goods that can be traded in the form of NFT are works of art such as game assets, photos, videos, music, and other works of art. Document assets can also be converted to NFT. The selling price of NFT itself depends on subjective factors such as quality, creativity, and the reputation of the artist.
NFT and Crypto are two different things?
Often NFT is equated with Cryptocurrency because it is considered to have a similar way of working. However, in reality, there are fundamental differences between the two. NFT itself is a derivative of crypto, so its manufacture is the same as crypto, namely by minting.
However, these two things have differences in their selling points. Each crypto coin has the same value, while each NFT has a price that varies depending on the artwork being traded. In addition, a significant difference is the existence of ownership rights or proof of ownership in NFT. This is what makes NFTs exclusive because each NFT only has one owner for one period of time.
Proof of ownership is different from copyright, where the owner of the NFT can change through buying and selling activities, but the copyright will still be held by the creator of the party who is minting the work. The smart contract system provided by NFT allows creators to earn a royalty percentage each time their work changes hands. The number of royalties that adjusts to the initial agreement that has been agreed by the creator with the platform.
Why NFT is an attractive investment option
The uniqueness of NFT as a crypto derivative is the main attraction for investors to deepen the world of NFT. In addition to investors who have been in the crypto world for a long time, NFT opens up a new market for artists to work and invest at the same time.
Not only the creators or artists, but collectors also welcome NFT with great enthusiasm. One collector of action figures to comics, Irzan Raditya, who is also the Co-founder and CEO of Kata.ai, admitted that he was interested in the NFT concept.
In Indonesia alone, NFT first exploded due to the sale of NFT selfie photos of “Ghozali every day” which reached up to 12 billion. As a photo maker and the first party to register the NFT, he gets 10 percent of each transaction. This high profit makes investors or ordinary people interested in deepening NFT.
Apart from Ghozali, there are many other Indonesian creators who sell their works and sell them well in the market with great profits. One of them is Yoy, an illustrator and NFT artist who once sold his work worth 12 million rupiahs. Tech in Asia, last December 2021 released its first NFT with the aim of celebrating Grab’s entry into the capital market and successfully sold for 15.8 million rupiahs
With so many conversations about NFT, are you one of those who are interested in investing with NFT? Litedex will also be involved in the NFT world in future projects. Don’t forget to always Do Your Own Research (DYOR) every time you want to invest. Find further information through the Litedex website and social media on Instagram, Twitter, Tiktok, and Telegram.
Dengan maraknya perbincangan mengenai NFT, apakah kamu salah satu yang tertarik untuk berinvestasi dengan NFT? Litedex juga akan berkecimpung dalam dunia NFT pada project-project selanjutnya. Jangan lupa untuk selalu Do Your Own Reserach (DYOR) setiap ingin berinvestasi. Temukan informasi selanjutnya melalui website dan sosial media Litedex di Instagram, Twitter, Tiktok, dan Telegram.
