We have seen an explosion of news lately that have many of us reeling and asking, “what the heck is going on?” How can NFTs of digital ape images sell for tens of millions of dollars?
Well, I can't answer that question. But, what I can say is that digital ape pictures – and collectibles, in general – are only the tip of the iceberg for the many uses for NFTs. So, if you’re not into collectibles, there is still an NFT type for you.
Applications
NFTs have already generated a lot of attention in the arts, gaming, and entertainment worlds. And, although NFTs are best known as a tool for investing in digital collectibles, in theory, they can be applied to just about anything of value in both the real or digital worlds. Many of the real-world use cases are still in the early stages — such as, licensing, certification, real estate, supply chain management, and logistics.
Personal Identity
One area, where NFTs can really shine, is personal identity management. Imagine our driver’s license and passports as NFTs. Why not an NFT instead of an immunization card?
Non-fungible tokens are programmable and can contain a unique set of information that can be used to tokenize documentation such as degrees, certificates, licenses, identification, and other qualifications, as well as medical records, birth and death certificates. They can be used to digitally store and protect medical histories, personal profiles, and other details in a manner that gives users better control over their data and help prevent identity theft.
Advantages
NFTs can be used to minimize counterfeiting and keep track of items along a supply chain. Because of their transparency and immutability, NFTs are suitable for logistics applications. Businesses, like the auto and electronics industries, could use NFTs to store component use data and full material disclosure of their products for the purpose of declaring regulatory compliance, reporting waste information, and tracking the use of recyclable and sustainable materials.
Examples
Sports, concerts, movies, and other events have already tokenized their products. Instead of tickets, NFTs could be issued, which could minimize scalping. But, with a ticket being an NFT, the ticket could be a collectible that could be sold after the event is over. The media and film industry could also use NFTs as the license to their intellectual property and could further protect their property from being copied or shared without the owners' permission. And, they could sell limited copies of a special edition — like a director's cut — as a collectible.
Since NFTs are programmable tokens, they can also act as smart contracts. NFTs, like all tokens, have their own accounts — which means, they can receive and send currency. Real estate could take advantage of NFTs by acting as an Escrow — where the funds are held by the NFT until all requirements of the sale are complete. At which time, the NFT would release the funds to the seller and transfer the title to the buyer.
See also: