Will the NFT that has surged sixfold in three years become a meme in the cryptocurrency circle in 2020?

How to break out of the circle and reach a broader audience, making the currency circle no longer a celebration of a very small number of people? This is a question that every practitioner faces. Putting big brands on the chain, games are seen as a popular way to break out, and behind this is a concept that has gained popularity in the past two years—NFT.

Author | Bing Bang Editor | Bitongtong Produced by | PANews

How to break into the mainstream and reach a broader audience, making the cryptocurrency world no longer a niche party for a few? This is the question facing every practitioner. Linking to trendy brands, games are seen as a promising way to break into the mainstream, and behind this trend lies a concept that has gained popularity in the past two years—NFT.

A set of recent data released by NonFungible.com shows the rapid development path of NFT since its birth in 2017. The report titled "2019 NFT Annual Report" analyzed some Dapp data on Ethereum represented by ERC721, indicating that in 2019, the NFT market saw an influx of fresh blood, especially in the gaming sector, with many successful cases emerging.

Market Value Increases 6 Times in 3 Years

What is NFT? NFT stands for Non-Fungible Token, while what we commonly see are fungible tokens. For example, 1 BTC in your hand and 1 BTC in someone else's hand are the same, with equal anchoring value and can be exchanged freely.

Non-Fungible Tokens (NFTs) are unique tokens, even within the same system, each NFT exists with individual attributes. Unlike BTC and ETH that can be divided into 0.1 or 0.0002, the unit of NFT always remains as 1, characteristics: unique, non-divisible.

Since 2019, mainstream public chains and cross-chain systems including ETH, NEO, VeChain, EOS, Cosmos, etc., have supported the embedding of NFT modules. The NFT token standard has evolved from ERC-721 to the ERC-1155 multi-token model, gradually gaining industry recognition and acceptance.

In 2018, the overall cryptocurrency market was in a bear market, but compared to 2017, the total market value of NFTs increased by as much as 482%, and the number of players in the NFT cryptocurrency market grew by 92% from the previous year. In 2019, the market value of NFTs increased by 17%, while the number of players only grew by 1%. NonFungible.com predicts that in 2020, the total market value of NFTs will increase by over 50%, and user growth will surpass 30%.

The activity of smart contracts can be seen as the heartbeat of a market, and the active time of NFT smart contracts in 2019 indicates a stable growth trend from 2018 to 2019.

All these data indicate that the NFT market is brewing.

Three Games Dominate Half of the Trading Volume

NFT is naturally suitable for crypto games, creating personalization and scarcity. There are 7 main types of NFT game projects: collection, virtual world, art, utility, TCG cards, role-playing, and strategy. Among them, the most popular are collection projects, such as the once Ethereum-clogging CryptoKitties.

Considering user distribution and transaction volume, Cryptokitties, My Crypto Heroes, and 0xUniverse dominate the NFT market.

The persistent leader Cryptokitties, developed by the Canadian company Axiom Zen, is the world's first blockchain-based cat breeding game. Cats are born in two ways: the official release of a new kitten every 15 minutes, with a total limit of 50,000, known as generation 0 cats. Each cat is unique, cannot be replicated, stolen, or destroyed.

Unlike other collectibles, cat lovers can virtually mate cats, producing first-generation fancy cats with unique genes, which owners can choose to continue nurturing or sell. Behind each fancy cat is a corresponding NFT.

Not only favored by players, the capital market is also extending an olive branch. For example, in September 2019, the cryptocurrency game Gods Unchained received a $15 million investment led by Naspers and Galaxy Digital. Gods Unchained is a card game where players initially receive a set of free standard cards, and players can purchase, battle, or buy cards from other players through the official website to obtain unique attributes. Gods Unchained once auctioned a card named Typerion for $62,000, the most expensive card in the world. The NFT tokens of Gods Unchained traded up to 13 million times in November 2019.

However, the above NonFungible.com report does not include data on the Enjin platform's ERC-1155.

Enjin is currently the world's largest online gaming community creation platform, founded in 2009, with a total of over 250,000 gaming communities, guilds, fan sites, etc., globally described as "massive" user resources. These users will directly engage with cryptocurrencies through the Enjin platform, becoming an increment to the cryptocurrency market.

Enjin has developed a new token standard system, ERC-1155. On June 18, 2019, ERC-1155 became the token standard for Ethereum. In the short term, the Enjin platform will be the main battleground for ERC-1155 token models in the future.

On February 18, 2020, the Enjin platform officially launched, utilizing the Ethereum network as its underlying data processing engine, allowing users to trade and create games through the trusted Enjin platform. The Enjin platform is a combination of various technologies.

NFT Penetrating Daily Life

In the future of standardization, token legalization, NFT offers vast imagination. NFT truly permeating our daily life scenarios includes not only virtual products but also identity authentication, electronic evidence, collectibles, and even every book in the library, bags in stores, etc.

Currently, physical items have begun to integrate with NFT. In December 2019, the globally renowned sports brand NIKE obtained a patent in the United States for tokenizing shoes on the Ethereum blockchain, named CryptoKicks. This patent can generate a unique ID for shoes, creating NFTs based on the ERC-721 standard.

NFT serves as a unique identifier for shoes, recording the shoes' attributes, colors, styles, etc.

When a consumer purchases sneakers, they can unlock a 10-digit identification code on the shoe tag through a mobile phone or other devices, generating a unique NFT. This NFT represents ownership of the shoes, and when the shoes are transferred, the NFT also moves with the purchase. These NFTs representing shoes are all stored in a program called Digital Locker, similar to a cryptocurrency wallet.

CryptoKicks draws inspiration from the trendy gameplay of CryptoKitties, where shoes can give birth to baby shoes. Buyers can place virtual shoes in the Digital Locker and pair them with other shoes for breeding. If the manufacturer is willing to produce, these virtual shoes can eventually be made into physical shoes.

KnownOrigin is a DApp running on the Ethereum network, allowing users to create, purchase, transfer, and trade unique digital artworks. When users buy or transfer an item on KnownOrigin.io, the corresponding NFT automatically transfers to the user's Ethereum address. Artists can easily release their digital artworks through KnownOrigin, creating their own NFTs. Other platforms similar to KnownOrigin.io in similar application scenarios include MakerSplace, Superrare, and Rareart.

NFT Could Become a New Meme Collection

Richard Dawkins first introduced the concept of memes in his book "The Selfish Gene," which means "the basic unit of culture, transmitted by non-genetic means, especially by imitation."

From a cultural perspective, many popular phenomena are collections of memes, and there are many ways to make money through memes. For example, diamonds, gold, continuously implant concepts like "diamonds represent love" and "rarity" in people's minds, and online games also design demands for players. Similarly, Bitcoin is also a successful result of a meme.

The uniqueness and permanence of NFT are special uses of blockchain technology. Strictly speaking, NFT is not a "coin," NFT is more like a service. In the examples above, more attention is paid to the scarcity of NFTs. Indeed, the provability of NFT's scarcity is strong, seemingly increasing the scarcity of products just by tokenizing them with NFTs. In reality, what audiences are more willing to buy are the products and services behind NFTs, as well as the stories.

In 2019, the total market value of the NFT market was only $210 million (only the ERC-721 series), which has not reached the market value of a single currency ranked 30th in the current cryptocurrency ranking, indicating that the NFT market still has significant room for growth.

Unlike fungible tokens, NFT's application scenarios are more precise and extensive. Leveraging scarcity and the cultural connotations behind products, NFT may become a new collection of memes, penetrating into broader scenarios and achieving true mainstream adoption of cryptocurrency concepts.

Original Article from partner PANews

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