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The Future Just Changed And Most People Missed It (NFTs & The Future Of Digital Assets)
Did you see it?
Dear Friend, Subscriber, and fellow Category Pirate,
The future just changed.
Did you see it?
Last week, a digital artist named Beeple sold a collage of 5,000 daily digital art creations in the form of an NFT (non-fungible token—and if you don’t know what that means, we’ll explain in a second).
The sale was facilitated through Christie’s, the world’s longest-standing and most credible art auction house in the world. This NFT also marks the first time a piece of digital art (not a digital representation of physical art, but art that was created digitally) was sold through Christie’s—meaning the auction house believed the value of this NFT to be right up there with a Signac or Cézanne painting (both of which sold in 2019 for $26 million and $82 million, respectively).
The digital art collage, Everydays—The First 5000 Days, sold for a whopping $69 million.
Which means “a Beeple” is now valued among these timeless artists.
*If you want to read more about the details of the sale, who the bidders were (including crypto mega-millionaire and founder of the cryptocurrency platform TRON, Justin Sun), and who the winner of the auction was, here is a good summary of the events.
Now, what the buccaneer is an NFT?
An NFT (non-fungible token) is manufactured scarcity.
In the physical world, rare assets are more valuable than non-rare assets (a house in the Hamptons is rarer than a house in the middle of Nebraska because there’s only so much land on the South Fork of Long Island and there’s a ton of excess land in the Cornhusker state).
How we know these assets are rare is because only so many of them exist. For example, there are only ~23,000 homes in The Hamptons—which is why the median price for a home in that area of the US is $1+ million (compared to the median price of a home in the New York area, which is ~$300,000). Or, there are less than 10,000 1st Edition Holographic Charizard Pokémon cards in circulation—which is why each one is valued today anywhere from $5,000 to $10,000 per card. Or, there is only one Mona Lisa (which was last valued at $100 million in 1962. By today’s standards, that means the painting on permanent display at the Louvre in Paris is worth just shy of a billion dollars).
Scarcity is what makes these physical objects valuable.
But how do you create scarcity in the digital world?
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