Comprehensive analysis of the brief history, value and future of NFT development

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This year is known as the “first year” of NFT. Uniswap sold a pair of socks for US$160,000, Twitter founder’s five words sold for US$2.5 million, and encryption artist Beeple’s digital work “First 5000 Days” was sold at Christie’s single auction site for 6,900 It was sold at a price of ten thousand dollars; all this makes people feel incredible.

For most ordinary investors or people outside the industry, the story of NFT seems a little bit abrupt. Is NFT the next “Brilliant New World” or a bubble? To be honest, the market results are often posterior, and we tend to make sense after the fact, but it is not so easy to determine the direction of this emerging market. However, it can be concluded that investing time to understand NFT will not bring us much loss, and if we are fortunate to have the NFT mature, we are familiar with the operation of this market, and the time invested will naturally get better returns. . Moreover, the interesting gadgets brought by the NFT market alone are enough as a reward.

If you are interested in NFT, I hope the comprehensive analysis of NFT in this article can help you. But for the length of this article, I apologize in advance. This article aims to provide an in-depth overview of non-homogeneous tokens, mainly including the development history of NFT, the current market development, application level, value and future, etc., and a number of query tools for the NFT market are attached. This knowledge will help us better understand and participate in the emerging market of NFT. We hope that whether you are a novice NFT beginner or an experienced NFT player, you can gain something after reading it.

1. How was NFT born?

When we understand a new thing, we must first understand its origin, and only by fully understanding its origin and evolution process can we deeply understand the future value foundation that the new thing may contain. Therefore, to understand NFT, we also start with how NFT was born. The concept of NFT was formally proposed in 2017 by Dieter Shirley, the founder and CTO of CryptoKitties. That year, as BTC rose from US$5,000 to US$200 million in just 2 months, a crypto cat game quickly became popular in this massive crypto bull market. In the summer of 2017, the ERC20 token standard and 1C0 based on ERC20 were particularly popular. After the launch of CryptoKitties, many users asked how Dieter CryptoKitties interact with ERC20. In fact, CryptoKitties and ERC20 cannot be compatible, because CryptoKitties It is based on another token standard, ERC721, which is a non-homogeneous token, while ERC20 is a homogenous token. In order to better explain the difference between CryptoKitties and ERC20, Dieter came up with a fixed and simple answer, and then Dieter proposed the concept of NFT, that is, the concept of non-homogeneous tokens. As a result, with the popularity of CryptoKitties, the concept of NFT quickly entered the public eye. As a result, digital assets no longer only refer to encrypted currencies, but are a combination of homogenized encrypted currencies and non-homogeneous NFTs. Although the formal concept of NFT was proposed by Dieter in 2017, similar concepts and applications based on NFT appeared earlier. Understanding the historical evolution of NFT will help us understand the value and application of NFT.

  • 1993: Crypto trading card
  • The concept of NFT and its predecessor can be traced back to 1993 Crypto Trading Cards. The general situation is that in 1993, Hal Finney (the first senior cryptography expert to receive Satoshi Nakamoto’s Bitcoin and a pioneer of Bitcoin) shared an interesting concept, the general idea of ​​which is:
  • “I thought a little more about the idea of ​​buying and selling digital cash, and I thought of a way to show it. We are buying and selling “crypto trading cards.” Enthusiasts of cryptography will love these fascinating examples of cryptographic art. Please note that its perfect combination is a mixture of one-way functions and digital signatures, as well as random blinding. This is a perfect work worth collecting and showing to your friends and family. “
  • This may be the earliest elaboration and idea about NFT that we can find. Although the logic is the same as when we were a kid, we bought a whole set of Water Margin cards; but the form of expression is based on the form of encryption and mathematics. Then randomly arrange a set of cards to form a series, and Hal defines it as an encryption card.
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  • 2012: ColoredCoin (Colored Coin)
  • In 2012, the first NFT-like token Colored Coin was born. Colored coins are made up of small denominations of bitcoins, and the smallest unit is a satoshi (the smallest unit of bitcoin). It can represent multiple assets and have multiple uses, including property, coupons, and issuance of company shares. Although there are still many defects in the design of colored coins, the colored coins show the plasticity and development potential of real assets on the chain, which laid the foundation for the development of NFT.
  • 2014: Counterparty
  • The birth of colored coins has made many people realize the huge potential of issuing assets on the blockchain. In 2014, Robert Dermody, Adam Krellenstein and Evan Wagner founded Counterparty. This is a peer-to-peer financial platform, and a distributed open source Internet protocol has been established on top of the Bitcoin blockchain. Counterparty supports asset creation, has a decentralized exchange, XCP contract currency, and many projects and assets, including card games and Meme transactions. What really promotes the emergence of NFT is the “Rare Pepes” created on Counterparty, which makes the popular meme sad frog an NFT application. A meme is translated as a meme, which is actually a kind of emoticon, a picture or a sentence, or even a video, an animated picture, which can be simply understood as the “stalk” we are familiar with.
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  • June 2017: CryptoPunks
  • In 2017, when the Ethereum ecosystem began to exert its strength, two developers who were not in the cryptocurrency circle came to this ecosystem by chance and brought more than 10,000 pixel avatars, and thus developed the world The first NFT project-CryptoPunks. Two people, John and Matt, who were originally doing mobile app development, made a pixel character generator in early 2017 and created many cool pixel character avatars. When they were thinking about what they could do further around these avatars At the time, they paid attention to the blockchain and Ethereum, which was relying on the ERC20 token standard to become popular at the time. So they decided to put these pixel avatars on the blockchain, so that these very personal pixel avatars can be verified through the characteristics of the blockchain, and they can be owned by others or allowed to be transferred to others. .
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  • Since the ERC721 or ERC1155 certificate protocol specifically for the NFT field had not yet been born, the two made appropriate changes to the ERC20 standard and finally successfully moved these punk-spirited pixel avatars to Ethereum.
  • As a result, the world’s first NFT project, CryptoPunks, was born. It pioneered the introduction of images as encrypted assets into the cryptocurrency field. When various tokens were flying in the sky at that time, it gave many practitioners new inspiration as a clear stream.
  • October 2017: CryptoKitties
  • As the innovative project CryptoPunks has been hyped up on Ethereum, this non-homogeneous token has also brought a new trend of thought. Inspired by CryptoPunks, the Dapper Labs team launched the ERC721 token standard specifically for the construction of non-homogeneous tokens, and then based on ERC721, the Dapper Labs team launched an encrypted cat game called CryptoKitties, allowing every digital cat They are all embodied as unique, and their value cannot be copied. “Scarce can maximize value.” The innovation of CryptoKitties in the presentation of value shaping made CryptoKitties quickly become popular and became the mainstream of the market, so NFT became popular.
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  • 2018-2019 return to construction
  • In 2018 and 2019, the NFT ecosystem has achieved large-scale growth. At this time, there are more than 100 projects in this space, and more projects are in progress. Under the leadership of OpenSea and SuperRare, the NFT market is booming. Although compared with other cryptocurrency markets, the trading volume at that time was still small, but they grew at a rapid pace and made great progress. With the continuous improvement of Web3 wallets like Metamask, it has become easier to join the NFT ecosystem. There are now some websites, such as nonfungible.com and nftcryptonews.com, which delve into NFT’s market indicators, game guides, and provide standard information about the field. This picture from The Block illustrates the current NFT ecosystem well.
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  • 2020, the outbreak
  • After the epidemic, the governments of the United Kingdom and the United States have chosen to issue currencies to stimulate the economy. In the short term, traditional investment solutions have lost their appeal, and more people have become bold in venture capital, and then set their sights on the seemingly blue ocean. The FLOW public chain is online and the combination of NFT and DeFi has realized Gamefi—NFT welcome Here comes its spring.
  • Digital artist Beeple started to draw one picture every day in 2007, and finally stitched 5000 pictures into a 316 MB JPG file and sold it as NFT. This 14-year-old work “Everydays: The First 5000 Days” was finally sold on the famous British auction platform Christie’s for $69.34 million.
  • After Beeple’s record auction, stars and artists from all walks of life, including Zion Lateef Williamson, Takashi Murakami, Snoop Dogg, Eminem, Twitter CEO, Edward Joseph Snowden, Paris Hilton, Yao Ming, etc. have released NFTs through various NFT platforms, once again pushing NFTs to Public vision.
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  • In 2021, GameFi
  • In the middle of the year, the sales of the NFT game Axie Infinity skyrocketed. According to CryptoSlam data, as of August 7, the cumulative transaction volume of the NFT game project Axie Infinity exceeded $1 billion, ranking first in the NFT market in terms of transaction volume. The rapid rise of Axie Infinity drives the rapid development of the entire NFT market sector.
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2. Development status of NFT market

Beginning in February 2021, NFT has begun to explode, with weekly trading volume exceeding 2 million US dollars. As of May, in less than three months, the total market value of large NFT projects has increased by as much as 2000%, and the popularity is even Exceeding DeFi can be seen from the following set of data:  2.1 Google search volume will explode in 2021.  According to Google Trends, the global search volume for the keywords “NFT” and “Non-Fungible Token” will increase sharply in 2021, which also means that the attention of the NFT ecosystem is increasing. This part is transformed into supply and demand, which will continue to expand the scale of NFT.

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2.2 In 2020, the number of NFT transactions and transaction volume increased significantly year-on-year

According to the multi-party macro indicators given by NonFungible to analyze the NFT market trend in the past two years, first, “active wallet” defines the number of NFT smart contracts, where the same person can have multiple wallets at the same time; second, “buyer” It is defined as the number of wallets that have purchased NFT at least once in a year, and “seller” is defined as the number of wallets that have sold NFT at least once in a year; finally, “USD transaction volume” represents the total transaction volume of NFT.

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 From the perspective of market supply and demand pattern:

In 2020, the number of buyers increased by 66.94% year-on-year, and the number of sellers increased by 24.7% year-on-year. The growth rate of demand is much faster than the growth rate of supply. This supply-demand pattern is expected to attract more people to enter the market and inject a boost to the continued recovery of the NFT market. The number of active wallets in 2020 increased by 97.09% compared with 2019, and the increase in US dollar transaction volume was as high as 299%, mainly because more NFT projects entered the market, driving the dual growth of transaction volume and transaction value;

Following this logic, if more suitable new NFT projects enter the market in the future, the transaction volume/value will also increase one after another, and the prosperity of the NFT market is also expected to remain stable or to be further high. On the whole, the favorable market supply and demand pattern is superimposed on the fact that more projects will enter the market in the future to drive the inflow of funds, and the development prospects of NFT can be expected.

2.3 Total trading volume and trading platform situation

At present, the NFT trading market has gradually formed, and the trading volume is mainly concentrated in the top projects and top platforms. NBATopShot, CryptoPunks and other projects account for most of the NFT trading volume, while OpenSea and Nifty Gateway are absolutely in their respective market areas. Lead. This situation is more obvious in the NFT of digital art works. Head art and artists account for most of the turnover, and more works NFTs are sold at low prices and no one cares about them. 

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3. NFT ecology and section classification

3.1 NFT ecological classification

In terms of functional attributes, NFT ecological applications can be divided into four layers: infrastructure bottom layer, project creation layer, transaction circulation layer, and derivative application layer.

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At present, NFT projects are mainly concentrated in three areas: digital collectibles, game assets and virtual worlds:

Digital collectibles are often multimedia content with specific cultural imprints and artistic aesthetics. For example, NBA Top Shot is a short video clip collection NFT of NBA stars; game assets are more emphasis on use, such as the blockchain card game Gods Unchained Card NFT can be used in actual battles;

The virtual world generally auctions the plots and special items in it, such as the plot NFT in Decentraland, and users who own the NFT can construct and transform the corresponding virtual land. In addition, there are all kinds of NFT projects. They are often scarce, belong to certain cultural circles, or have corresponding uses.

At the trading circulation layer: a comprehensive trading platform led by OpenSea provides users with a stable and convenient multi-category, NFT asset trading experience. OpenSea supports the trading of NFT assets on multiple project platforms, known as the “Amazon of NFT”, and users can upload data content on the platform to cast NFT for free.

The digital art trading platform headed by Nifty Gateway focuses on serving artists and art lovers. The focus of its business is to solve the pain point of traditional digital art works that lack transaction entities through the combination of NFT and digital art, and to bring new digital art. Transaction mode.

3.2 Segmentation

From the above conceptual ecology, it can be seen that the product categories involved can be divided into the following tracks: Game-NFT, Art-NFT, FI-NFT, and IP-NFT, as follows:

NFT Project Summary Project Category Project Artwork OpenSea, Rarible, AsyIc Art, Wrapped Cryptopunks, LinkArt, Superare, joy, Cryptograph, MakersPlace, KnownOrigin Games Enjin, chiliz, Sorare, CryptoKitties, League of Kingdoms Domain Name Service, Unstoppable Domanins Insurance Yinsure .finance virtual world Decentraland, The Sandbox, Somnium Space, Cryptovoxels , NeoWorld

4. The development prospects and prospects of NFT

Layer2: The core implementation of decentralization is to put assets on the chain. The storage of assets on the chain is a prerequisite for trustlessness and fairness, and the same is true for NFTs. The diversity of NFTs has brought a series of complex rights and interests into the encrypted world, such as intellectual property rights, personal behavioral data, etc. These assets need to be visible on the chain, circulated, and compatible with different types of agreements in the internal ecosystem of the blockchain. Interactive.

The value of Layer 2 is revealed here. First, its cost is lower and more efficient, which can alleviate the impact and challenge of the complexity of NFT on the performance of the public chain; secondly, although the ideal realization of the NFT function requires very much on the underlying foundation High, there may be technological breakthroughs in the more distant future, which may bring the application scenarios of NFT to new heights, but in the foreseeable future, Ethereum will still be the main value-intensive area of ​​NFT, and the NFT ecology will definitely be compatible with DeFi. The ecology produces more interactions, so Layer 2 and side chains have a unique advantage over other independent public chains. Decentralized storage: At present, there are still many problems with NFT storage, and most NFT trading markets have not yet completely decentralized. Although the NFT itself is stored on the chain, because large files cannot be stored on the chain, the relevant pictures, videos and other files corresponding to the NFT are still stored off-chain, but the hash value data of these files is stored in the NFT token. Among the data. This is a great hidden danger for NFT holders. The NFT’s life and death encyclopedia is not in the hands of the holder, which is quite absurd. Therefore, decentralized storage has become the general trend. At present, decentralized storage systems such as Arweave and IPFS are more closely linked with NFT, and can continue to focus on future development. In addition, we believe that there are several potential development directions for NFT in the future: 1. Metaverse + social experiment When the real metaverse will be applied is still unknown, but one that can be imagined is very interesting and implementable. The more sexual landing is the low-cost social experiment. Some research and experiments require extremely high world, capital, and social costs in the real world. Metaverse provides a very good alternative to such needs. For specific scenarios, it can be assumed that one party will fund a virtual experimental project for research and academic needs to undertake Fang is responsible for building a specific virtual world and recruiting volunteers in accordance with the logic of the experimental needs. Volunteers conduct virtual experiments and get paid after successful completion. Some people regard the current blockchain economic ecology as a social experiment, but this “experiment” obviously lacks independence and cannot control variables. Social experiments in the meta-universe are isolated from the outside world, reversible, and repeatable. 2. Oracles and aggregators Currently, the interaction between NFT and DeFi and CeFi is very limited, which requires new oracles and aggregation protocols to link the three. At present, the trend of NFT ecological multi-chain development is becoming more and more obvious. The security issues, efficiency issues and centralization issues of cross-chain bridges are all obstacles to the interaction between NFT ecosystems. In order to improve efficiency and effectiveness, the future Oracles related to NFT will definitely appear in large numbers. Similarly, in the NFT ecosystem, aggregators related to user transaction costs and investment income such as DeFi’s 1inch and yEarn will also appear in large numbers. 3. Social and display NFT holders and value believers need a “show off” stage. This type of social gathering place is very effective in consolidating NFT value consensus and attracting new blood to join. An effective way to turn NFT from re-speculation to self-realization is to provide value advocates and value believers with channels for expression and listening. Pioneers and KOLs in the industry need a “little red book” belonging to the NFT to show others their hobbies and style. 5. How to get NFT?

Disassemble the NFT first, you can get the most important features: · Rely on the blockchain. NFT must be issued on the blockchain. · Need to use some kind of agreement, even if it is a self-created agreement. · NFT has a known issuer. Although there are a large number of fraudsters trying to deceive, it can be compared by address · NFT is not necessarily scarce. The issuance of NFTs can theoretically be unlimited. Of course, in current practice, there is often an upper limit set. · NFT can carry out transaction circulation like qualitative tokens, unless the issuance contract adds restrictions. Therefore, if you want to obtain NFT, you can have the following ways: · Create your own NFT according to the existing or self-created NFT agreement, as we will mention below. · Participate in the primary market issuance activities of the NFT issuer, purchase fiat or cryptocurrency, and get NFT. · Purchase NFT from other NFT holders through NFT secondary trading markets such as OpenSea, Rarible, and AtomicMarket. · Participate in the community marketing activities of the NFT issuer team and get NFT airdrops. Let’s introduce these four methods separately. (1) Create NFT by yourself

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Everyone can create NFTs, which brings flexibility. Of course, it also means that the quality of NFTs on the market is uneven. A large number of NFTs do not have collection or transaction value. This is something you need to pay attention to when participating in NFTs. The NFT trading market usually also provides tools or tutorials to guide users to create their own NFTs, such as Rarible (supports ERC1155 protocol), OpenSea, MintBase, etc.

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Taking the most common NFT collection category as an example, the creation process of NFT can be divided into the following steps: · In the early stage of selection, select the blockchain where the NFT is located, the protocol and transaction market used, and the theme of the NFT, The number of plans to be issued, the target audience and the gameplay when it goes online (crowdfunding, free distribution, or distribution as a mining reward). NFT issuance is also a process of product creation. · Design corresponding pictures, copywriting, and even multimedia materials according to the theme of the NFT and the audience. For collectible NFTs, it is more important to consider different types of series, as well as the design and evolution of the scarcity of collectibles (ordinary, scarce, legendary, epic, etc.). If it involves in-game NFT assets, you also need to consider the different types of NFTs and how to apply them in the game. This step is the most cumbersome. · You can use online tools to create NFTs, submit pictures, copywriting, scarcity, custom attributes, prices and other information, and then click Submit to deploy the NFT contract on the blockchain. · Check and test whether your NFT works can be traded or transferred. If some websites adopt the review system, additional NFT submission operations are required. · Finally, you can create an NFT shop in the NFT trading platform to display and sell the NFT you created. According to different NFTs or creation tools, there will be some differences, but the general process is shown above. As mentioned above, exchanges such as Rarible (supporting the ERC1155 protocol), OpenSea, MintBase, and trading platforms such as AtomicHub on the WAX ​​blockchain also provide their own creation tools, and interested readers can explore by themselves. (2) Participate in the primary market issuance of NFT

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Many NFT teams will adopt a limited time limit method to conduct the first NFT issuance, which is called the NFT primary market issuance. NFT new opening usually accepts legal currency or cryptocurrency as a payment method. Participants can get the corresponding NFT or a set of NFTs, and then unpack it, just like the little raccoon collection card that was played as a child. After tearing it apart, you can get different cards. The fun of playing blind boxes. It is worth reminding that NFT primary market participation is a high-risk activity. Although many NFT teams will adopt a limited time limit method to encourage users to participate in the creation of FOMO, and the participants in the primary market hope that they can buy and sell in the secondary market to make a difference. However, the design mechanism of the NFT itself is not attractive enough, the issuer’s influence is not large, and the audience is limited, which will affect the depth of participation in the secondary market and future expectations, resulting in the failure of the NFT held by the primary market participants to sell. Cause losses. Like any emerging market, NFT is also full of high-risk transaction categories, and readers need to distinguish by themselves. 

(3) Obtain NFT from the NFT trading market

The third way to obtain NFT is to buy from the NFT trading market. The commonly used NFT trading markets in the Ethereum community are Rarible, OpenSea, SuperRare, Collectables, etc., and the common trading markets on the WAX ​​blockchain are AtomicMarket, Myth.Market and other trading markets. If you have used any e-commerce website, you can be familiar with how NFT trades, because the operation on the NFT trading market is no different from online shopping.   

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First, browse and select the NFT you like in the market, and then click to view the details. If you confirm that it is correct, you can click to buy. 

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One more word here. Since NFTs can be created by everyone, and most collectible NFTs only provide pictures, and the address of Ethereum is easy to be confused, you must keep your eyes open and distinguish carefully when participating in NFT transactions. Someone once did an experiment and made a NFT with the same parameters and the same picture and put it on the NFT trading platform, and many users were recruited. Although the NFT trading platform may impose restrictions on this, it should be based on the address information officially announced by the NFT project team to avoid buying Li Gui. 

(4) Participate in the NFT community airdrop 

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Although NFT airdrops can be regarded as zero lottery, taking into account the handling fees required for subsequent transactions or receiving NFTs, if the handling fee of looting wool exceeds the value of NFT wool, the gain will not be worth the loss.

Usually this kind of news will be published in Twitter, Discord, Telegram groups, but domestic WeChat groups will also be involved, if you are concerned about NFT airdrop information, you may wish to pay more attention to these channels.  6. Methods of evaluating NFT

6.1 There are subjective and objective dimensions in evaluating NFT

Some people may think that the low-feature CryptoPunk they claimed for free in 2017 is priceless. However, collectors in the NFT market like OpenSea and Rarible often trade these basic punks, and in turn, continue to ensure that objective reserve prices develop naturally.

The lower price limit of this volatility can objectively tell us that a given set of NFTs is currently worth at least so much money.

For example, at the time of writing, the lower price limit of CryptoPunks is about 19 ETH, so if you list CryptoPunk at approximately this price, it is likely to sell quickly because many buyers will track the most affordable possibilities.

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Source: larvalabs.com/cryptopunks

When it comes to objective valuation, you must also consider applicable rare features (such as how Axies with mysterious parts are valued in Axie Infinity), and items where the main sales price is hard-coded.

Examples here include binding curves like EulerBeats, or normal Avastar is always 0.07 ETH initially, Uncommon Avastar is always 0.14 ETH, and so on.

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Source: avastars.io

There is also the time dimension that is the key to review.

In other words, what is the value of this NFT in the past? How much is it worth today, and how much might it be worth in the next few years? How does its value change rapidly or leaps and bounds with prosperity and depression over time? In-depth study of these issues is a good way to better deal with any NFT valuation.

Finally, evaluating NFT has an analytical dimension that combines subjectivity, objectivity and time. What I mean is to be able to consider these other dimensions at the same time, and then analyze and estimate the conservative, neutral and aggressive valuation of NFT on a rolling basis. This provides you with a framework to deal with and understand all the meaning of “what if”, for example, what if the market for the asset heats up, or cools, or remains flat?

Suppose you have a CrypoKitties founder cat (in the first 100 CryptoKitties created), and you want to figure out how it will perform next year.

If the NFT bull market continues in the next few months, then your aggressive analysis is likely to be that your Kitty can easily get dozens of ETH, and your conservative analysis may be that if the NFT bear market, you can at least get any Founder Cat reserve price. , You want to sell. At the same time, you hold Kitty and analyze its valuation among its many possible connections.

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Source: cryptokitties.co/kitty/2

However, this is just a bird’s-eye view of how people understand NFT valuation.

The best way to accurately evaluate NFT is to weigh the current market conditions based on the basic objective elements of NFT. What are its components? How is it built? What can it do?

Let us look at the most important of these elements, namely the following value-added factors.

6.2 7 characteristics that drive the value of NFTs

6.21 On-chain security

The whole point of NFTs is that they are immutable and guaranteed digital assets-as long as their underlying blockchain infrastructure remains immutable and guaranteed, that’s it!

Therefore, Ethereum is the ruler of the NFT network, thanks in large part to its easy to become the safest smart contract platform in operation today, and this dominance is expected to continue in the foreseeable future.

In other words, over time, the chain on which NFT is minted helps and ensures its value. This is why NFT minted on Ethereum is currently more valuable than NFT minted elsewhere. They are just safer.

The key issues of chain security: · Is the host chain safe? · Is it decentralized enough?

6.22 Winding up

NFT is completely cast on the chain, such as Avastals, Aavegotchis and Art Blocks drop, which only rely on their respective Ethereum smart contracts to exist. This means that as long as Ethereum exists, they will exist, which may take a long time.

On the other hand, some NFT projects choose simplicity and flexibility by making their NFT dependent on external off-chain providers (such as AWS). This introduces a dimension of trust, so you must hope that the project will survive and keep its servers running.

Otherwise, you may effectively have a blank NFT within a few years.

Therefore, the more the NFT is on the chain, the more self-evident its original value-it can prove itself, and it can prove itself at any time.

Key questions on and off-chain: · Where is this NFT hosted? · Is this NFT completely on-chain (meaning it will last forever into the future)?

6.23 Age

NFTs can also gain value, depending on their casting time. For example, NFT really began to heat up in 2020/2021, so the NFT before this era has begun to assume the status of digital artifacts, that is, the earliest objects in cultural change.

However, things about NFT are still very early, and I think this age factor has not yet been fully resolved. In the end, it could be any NFT or anything of special significance cast before 2030. Just wait and see.

At the same time, the earliest NFT projects have received impressive valuations (such as CryptoPunks). Many collectors believe that these NFTs are from 2017, which is the prehistoric period of the media.

So just like wine, always remember age! Key questions about age: When was the NFT cast? · Does this NFT have any historical significance?

6.24 Creators and communities

If someone who has no followers and no history places an NFT on OpenSea and does not announce it, will it be sold? Of course not without further efforts!

This is why NFTs issued by major artists or creators give it value. It is full of the magic of the issuer’s digital fingerprint-like an autograph. The important thing is that involving the community creates demand.

Naturally, the more popular creators and the larger the community, the greater the value of NFTs-this dynamic is basically applicable to any market.

Key questions about creators and communities: · Does the creator have followers on social networking sites such as Twitter and Instagram? · Do they often interact with fans? · Do you think creators can develop their own brands in the future?

6.25 Scarcity

In the NFT ecosystem, we have seen creators publish NFT as 1 of 1s or multiple versions, such as 1 of 10s, 1 of 50s, 1 of 100s, etc.

Obviously, 1 of 1 is very scarce, so they are more valuable on a basic level than works diluted in multiple versions. However, this does not mean that multiple versions are worthless-we have seen that their prices are as high as thousands of dollars!

Platforms such as SuperRare only support 1 of 1 version, so if you buy one of the rare 1 NFTs, you will guarantee that only one authentic artist is in circulation!

Key questions about the scarcity of editions: · How many pieces were cast? · Will artists maintain their social contract instead of forging more of these?

6.26 Release speed

Did the creator cast 1,000 1 of 1 NFTs in a year, or did they only cast 12?

I mean, figuring out the production speed of a given type of NFT is the key to understanding its value.

Items that offer unlimited NFT minting at a price of 0.01 are usually not as attractive as buying NFTs from artists who promise to mint only 25 NFTs. Naturally, outstanding artists who publish only a few selected works each year tend to sell more than similar artists who publish works multiple times a week.

However, there are also some unique occasions, such as how Beeple sold his entire series for nearly $70 million-5000 pieces, and he created 1 piece a day for more than 13 years. However, it took more than ten years of unremitting efforts to establish this valuation!

Key questions about release speed: · At what speed does this artist create new works (daily, weekly, monthly, yearly, etc.)? · How many pieces did they cast?

6.27 Richness (eg audio)

We are beginning to see more and more visual NFTs with audio. This dynamic provides users with a richer artistic experience than ordinary old NFTs. Who doesn’t like playing music while their NFT is looping strangely and satisfyingly?

With this in mind, audio can enhance the sensory added value of NFT—especially if the audio is done in collaboration with major artists.

Therefore, it is expected that through NFT, the integration of video and audio will become more artistic norms.

Key questions about audio: Does NFT have audio? · Who made the audio for this work?

6.3 Reward: item-specific rarity

Some NFT projects, such as CryptoPunks and Axie Infinity, have NFTs centered on various features. For CryptoPunks, aliens and apepunks are the most valuable compared to standard punk. Likewise, Mystic Axies are the rarest (and usually the most valuable) Axies on the market. The rarer its characteristics, the more likely the NFT is to make substantial profits in the NFT market.

Therefore, if you see a large NFT sale and are confused about it, learn more about the underlying characteristics-their rarity may give you a better understanding of why the sale occurred!

Therefore, when evaluating NFTs, there may not necessarily be right or wrong answers, although if you try to do so, you will definitely consider a lot of dynamics.

The best approach is to take a holistic approach and understand all aspects of the project before triggering any triggers.

For example, the NFT ecosystem just rediscovered the MoonCats project that was released after CryptoPunks-but it disappeared after 2017. Now hundreds of people have cast MoonCats and tried to value them on OpenSea.

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In fact, we are still figuring out how to accurately evaluate them, and of course there is still no correct answer. Our valuation of them now will be different from 1, 3 or 10 years from now.

But apply the rationale: is this on the chain? Is this famous? Does the artist have a community? Is it their uniqueness?

These are the basic questions you need to ask yourself when buying an NFT. Put all your knowledge of NFT to use-this is the trick.

You must solve the problem of NFT valuation from multiple angles. But if you can, you are ahead of the curve.  7. How to query NFT information?

As NFT enters the mainstream, more and more artists and project parties have begun to join the NFT field. Since the beginning of 2021, the monthly transaction volume of OpenSea, the largest NFT trading platform, has shown explosive growth. NFT applications have also migrated from Ethereum to emerging public chains such as BSC, Matic , and Flow. Here are some NFT-related data websites. This helps everyone to study the market changes of NFT, while also avoiding some pitfalls.

NFT application list mathdapp.store

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DappRadder NFT application data

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NFT popular application data analysis

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Popular NFT application owner data

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NFT data on the ETH chain

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NFT data on the BSC chain

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NFT data on the Heco chain

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NFT Data Ranking

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Analyze, track and discover NFT

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NFT Artists Ranking List

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NFT asset storage evaluation

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Opensea NFT statistics

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NiftyGateway NFT Sold prices

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Data analysis on the NFT chain

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Encrypted art sales data

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ERC1155 data

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WAX NFT data

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DappReview Enjin application data

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NFT token data

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Marketplace submap data

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CryptoKitties subgraph data

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CryptoPunk subgraph data

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OKLink NFT market transaction data

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Concluding remarks

This is a “hope” panoramic analysis of NFT article, but we will never be able to truly understand NFT in a certain article or report. In this ever-changing experiment to verify the potential of the digital economy, no reference object has the power to travel through time. But we can still express our current understanding of NFT through some systematic and clumsy combing. This is a proposal for a brave new world. As humanity’s demand for digital asset ownership and property rights continues to rise and develop, we will personally witness many revolutionary experiments that take place through NFT, Create it and Enjoy it.

 

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/comprehensive-analysis-of-the-brief-history-value-and-future-of-nft-development/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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