We’ve been in an NFT “megacycle” since summer 2020. it means that we have over 2.5 Billion USD worth of NFT sales in just the first half of 2021.
The Real Value of Rare NFTs
It might appear that you are buying nothing, and there is no value if we examine NFTs from the perspective of the history and tradition of traditional art. However, clear parallels show that some NFTs can be worth the investment.
What Makes Art Worth Something?
The Art of Forgery (Phaidon 2015) defines art as:
Art Value = Perceived (Demand, Rarity, Authenticity)
Banksy prints will be more valuable if there is a lot of demand for purchasing prints, especially if buyers are willing and able to bid on them at auction. Value is also determined by rarity. A painting by Giorgione (16th-century Venetian painter) is worth more than one by Titian (16th-century Venetian contemporary). It is because Giorgione was 32 years old and had only painted 12 works of art, of which only five survive. Experts consider them equal painters (some art historians claim that they painted each others’ works and their styles are identical). Giorgione’s higher Value is due in part to the rarity of his work.
The Authenticity of Products:
The authenticity of products is equally important. Humans don’t like being fooled, so a painting by Titian may be worth a fortune. But if it is double, perhaps a scholar suspects it is a fake–then its perceived authenticity will drop, and its Value.
Perception combines all three components: authenticity, rarity, and demand.
Titian painted a painting called Diana & Calistoaround 1509. However, several artists created copies of the original, including 17th-century British painter Henry Stone. Buyers who believed Stone’s Diana or Calisto was by Titian were happy paying the total price.
What Makes NFTs So Valuable?
NFTs were in the news when Beeple, an artist, sold his artwork every day through the traditional art auction house Christie’s for $69.5million. It made it the second most expensive living artist artwork ever sold.
NFTs are different from other online files (the ones you can right-click and save) because they are not fungible. This means that they are unique tokens that are recorded on the blockchain. So it makes Rare NFTs that have a great value in today’s market.
NFTs are computer codes. The NFT is not a digital painting or music track, but it can be started as an analog painting.
How Do You Find Out How Rare Your NFTs Are:
The same can be said for NFTs.
Value for an NFT = Perceived as (Demand + Riarity + Authenticity).
It is crucial because most NFTs don’t sell because there isn’t a perceived demand. The ones that sell well, sometimes for large sums, have been heavily promoted. Either through a drop organized by platforms like Parable. Nifty gateway, Top Shot, OpenSea, or through traditional bricks and mortar platforms like Christie’s auction houses and the hype fueled demand. NBA Top Shot sells NFTs with basketball themes. Their top-rated digital trading cards and interested buyers must sign up for a waiting list. Collectors are compelled to purchase on primary and secondary markets whenever possible.
Mark Cuban, Dallas Mavericks owner, released 2 NFTs. He purchased one of them and publicly “burned” the other. It meant that he destroyed the one he kept to increase the rarity. The buyer believed that having one of the nine NFTs was more valuable than having two of them. NBA Top Shot trading card sets come in a variety of rarities. While a “common” series may have 40,000 cards, only 499 cards are available in a “Rare NFTs” series. Randomly generated NFTs can have rare or unique features.
Blockchain is proof of authenticity. The art world was stunned when Monsieur Personne broke into Beeples’ account to create a duplicate world’s most costly NFT. He didn’t create a second every day, but he gave the impression. Anyone can view creation, ownership, and transfer history. You will need to verify the blockchain. It is a step that some less impulsive buyers may not take. NFTs are valued at the same level as traditional paint and canvas art. Sometimes it is a matter of taste that makes NFTs valuable. You can choose to prefer Cryptokitties over Solana Sneks or a Titian.