NFT - Breaking down myths of NFT

Breaking down myths of NFT

1. NFTs are a type of digital money.

There is a widespread misperception that NFTs are a type of cryptocurrency. Blockchain technology underpins both cryptocurrencies and NFTs. The essential distinction between these two viewpoints is fungibility. A fungible thing can be replaced by an identical item of the same value; for example, one ETH can be swapped for one ETH. A non-fungible thing, on the other hand, has a distinct value that cannot be substituted by another object of equal value.

2. NFTs are a quick-rich scheme

Some individuals believe that all NFTs are frauds, while others believe that they are the future of all forms of art. In reality, NFTs are none of these things, as the idea of owning and selling limited-edition copies of work has been around for millennia. NFTs are precious and sought-after since they are frequently limited and one-of-a-kind productions. Investors have had their fair share of financial successes and disappointments, as well as fraud. Criminals can gain access to an account and resell it under the name of someone else.

3. NFTs aren't Trustworthy or Transparent

Grimes, a musician, has made a total of $6 million from digital artworks created with NFT technology. However, the buyers of his NFTs do not own the artworks themselves, which means they can be viewed and downloaded online. As a result, NFT technology seems to be neither safe nor transparent to NFT users. However, because each NFT is recognized by a unique serial number produced by the blockchain, it cannot be traded. They're dubbed non-fungible tokens because of this. Saving an NFT does not make you its owner; rather, it makes you the owner of the token in their wallet.

4. NFTs Have No Value and Are of No Use.

If a buyer feels an NFT has worth, or artwork has value, then the NFT or artwork has value. Yes, it is really personal. Beauty, on the other hand, is subjective. When most people say that NFTs are useless, they really mean that one specific NFT artwork will lose its value, which can be accurate.

It's important to understand that the value of the NFT idea and the worth of an individual NFT artwork is not the same thing. Although it is uncertain if NFT digital artworks will retain their value, the market for these tokens is currently so large that they cannot be worthless.

But are NFTs ineffective? NFTs will mostly be utilized for creative endeavours such as painting and music in the next years. Even said, non-fungible tokens will have thousands of conceivable use cases in almost every industry in the future.

For example, hospitals might use NFTs to store and communicate patient medical information or identification verification, making international collaboration simpler. Alternatively, we can all be able to save evidence of our academic qualifications or identification documents as NFTs, making cross-border travel faster and more convenient. Entertainers can soon be able to offer tickets to their events as NFTs, thereby eliminating ticket scalping. Finally, even if NFTs were solely employed in the creative sectors, they would still be useful.

5. You own the underlying asset when you buy an NFT

This is a technical misunderstanding rather than a myth. You do not instantly acquire ownership of the underlying asset, copyright, or intellectual property rights when you purchase an NFT. In reality, unless otherwise negotiated, intellectual property ownership remains with the person who created the NFT. 

If you purchase a CryptoPunk, for example, you do not have the right to construct and sell a collection of CryptoPunks. Similarly, possessing an NFT of a song or purchasing a limited edition CD from a band does not grant you the right to sell the band's music online or use their branding to sell your own music.