Non-fungible and creative investments
Estimated reading time: 5 minutes
Foxes in Boxers or FiB, a dynamic duo team of brothers recently shared about their new NFT venture.
Why foxes? And why are they in boxers? Market research about NFTs in the market, had revealed that a majority of folks creating NFTs actually do so based on animals.
Also, the rule of thumb seems to be that the NFT created has to be something creative and unique enough to represent an NFT owner’s identity – it’s something that they would like to have as digital wall paper on their Apple Watch face, for example.
But, what are NFTs or Non-Fungible Tokens, in the first place? The older of the brother duo, Jonathan Lee, explained, “We have to understand the reason they use words like non-fungible, or fungible, tokens, is simply to describe the asset that is sitting on the blockchain.”
So, something that is unique and one-of-a-kind like Leonardo Da Vinci’s Mona Lisa painting is non-fungible; it cannot be exchanged with anything of the same money value.
The same can’t be said of fungible tokens, however. “If I have one bitcoin and I exchange it with your one bitcoin, the value remains the same,” Jonathan explained.
So, this speaks to the quality of NFTs – it has a special characteristic, and is something that brings unique value to the owner.
Characteristics of the Mona Lisa – a masterpiece created by a very renowned Renaissance painter about 6 centuries ago – play a role in bringing value to the non-fungible art, his younger brother, Benjamin Lee explained.
Is NFT digital art?
It does not have to be. What is digital is how it is deployed, or presented to the world.
Jonathan said, “First, you have to deploy this NFT in a programmable contract, and then this NFT sitting in the blockchain, can indicate to us who the creators and owners of the NFT are.”
“Remember, it is not physical. Yet.”
When one goes to an online NFT marketplace like OpenSea, they may see something they like (a digital item, a piece of art, etc), then click to save it.
“You can go back to the Ethereum blockchain, and from this Ethereum blockchain you can tell specifically who the owner is via an alphanumeric hash.”
Crypto-wallets are one way to keep NFTs, and the NFT’s alphanumeric hash is linked or synced to the owner’s alphanumeric hash from their wallet.
“It’s like proof of your ownership of that NFT,” Benjamin explained, adding that a program called Etherscan.io, allows you to view transaction hashes of tokens, and verify its ‘status’.”
Skills, experience… a sense of adventure?
“I took a pretty long time to read documents about NFTS and it is not easy to start because of lack of resources and literature out there on the Internet. NFT is still in early stages, and there are not many YouTube videos that teach y you in-depth about NFTs or smart contracts.
“Recently, NFTs are starting to pick up, but in the previous months and years, it was pretty difficult. You had to really deep dive into the Internet to understand it and understand how to deploy it.”
Despite the lack of resources, he added that his prior knowledge of coding, programming helped somewhat.
“If you want to start your own NFT like we have, prior knowledge of the blockchain, of programming, and even of NFTs, like purchasing them to understand how they work, will help.”
A creative side, or being able to create art pieces is useful, too.
Jonathan shared a few ‘creative’ ways that people use. One example of creative use is Axie Infinity, a blockchain-based game which allows gamers to play and earn tokens which can be exchanged for money.
He said, “I have a few friends who play the game, earn their coins, and subsequently sell NFTs back to another user/gamer.”
Playing this decentralised NFT game full-time can potentially earn a person RM5000 to RM6000, he observed.
And then there are NFTs, where all that was involved was copy pasting an existing art piece and simply putting it up on a different blockchain.
With NFTs starting to enter the public mainstream realm, copy and pasting art is not going to cut it anymore, and Jonathan said more and more special and unique NFTs are being created.
As these NFTs are being created, potential ‘investors’ are looking at NFTs to invest in, and they would consider these unique qualities, as well as an NFT’s background and future roadmaps before taking out their wallet.
“So yes, now I would say there has to be a bit of creativity involved,” Benjamin added.
However, both he and his brother pointed out that pure creative people like artists and musicians, have the option of listing their works of art, on an open NFT marketplace like OpenSea.
Jonathan said, “OpenSea enables people to actually upload their NFTs without needing to have blockchain, or programming knowledge.”
It boils down to how one wants to prioritise their project.
Jonathan explained, “If you want to take it to the next level, create your own brand, create your own organisation, decentralised application, or even create your own 10,000 pieces collection (like Foxes in Boxers has), then programming and Blockchain knowledge comes in.
“Otherwise, you can definitely do it without programming knowledge,” Benjamin said,
His brother Jonathan said, “I think it’s a huge leap forward for investments and gaming, applications, and even finance.”
He concluded that NFT seems very consumer-centric at the moment in Malaysia. Some of the bigger companies use blockchain or are at least familiar with it.
But with NFTs and use of NFTs for investment, take up is going to take a bit more time.