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The crypto world was always a little offbeat, but with NFTs that unpredictability is amplified. NFTs are a component of the crypto ecosystem, traded and HODLed and flipped for profit, or liable to get you rekt, and yet there are some factors that distinguish NFTs from the rest of crypto.
Contempt
That is a strong word: contempt. But, it is true, NFTs set off a visceral reaction in some people. Strangely enough, you will see this particularly in parts of the art and gaming worlds. It is odd because NFTs bring fascinating new avenues to both art and gaming, and if you don’t care to go down those avenues, you can just not go down those avenues.
What I have seen is NFTs allowing artists and designers to take their work directly to the market, make initial profits, garner royalties and establish meaningful connections with enthusiastic collectors. And yet, NFTs have remained controversial in the art world. They are sniffed at as crass, trashy and irresponsible, but what could be more delicious than a bunch of sanctimonious art snobs having their party crashed?
Among gamers, the reaction can be even worse. Discord was always the social platform of choice for gamers, and so it was interesting when it was taken up (along with Twitter) by NFT projects. But, when Discord implied that it might integrate NFTs, an outraged rabble of users threw a tantrum, causing the company to backpedal.
A similar meltdown happened this month too, when OG games titan, Ubisoft announced it would be utilizing Tezos to produce blockchain games which include NFTs. Ubisoft has in fact been moving towards blockchain gaming for some time, but nonetheless, (some) gamers freaked out, and Ubisoft took down the trailer video for Quartz, its new NFT-incorporating gaming platform.
These reactions are baffling to observe, but what’s really fun is the reaction of NFT creators, collectors and believers. Basically, they don’t give a flying one, because they have diamond hands and crystal balls (no, I mean, they can see the future).
Emotional Attachment
NFTs with utility may be a good investment, but up to now, the most famous and expensive NFTs have been based purely around visuals. And, being non-fungible, they are unique.
This brings an additional component that distinguishes NFTs: emotional attachment. You will quickly offload a mid-cap altcoin as soon as you can make a profit. And, even with the more substantial coins whose fundamentals you believe in, and that you think have a long-term future, you might sell and buy back later.
But, that 8-bit koala with the 3D glasses? The llama smoking a pipe? My collection of intergalactic monkeys? Forget it, mate, hands-off.
A Few Good Traders
There appear to be fewer competent NFT traders than there are decent crypto traders.
Perhaps that is because NFTs attract a more arty design-focused crowd who are less interested in financial matters. There is the issue of emotional attachment, as mentioned. And, parts of the NFT world are based around collecting, which tends to mean people who hold on to what they buy, along with fewer potential takers if you decide to sell.
But, I also sense that quick trading is a little scorned. It is one thing to sell a bag of coins, but with an NFT, a certain amount of creative work has gone into it, and it might be a philistine move to simply flip it for profit.
Whether or not you care about being regarded as a philistine is another matter. But, from what I have witnessed, traders who intuit psychology, rather than those who focus on Technical Analysis, are likely to do better with NFTs.
A Gateway Drug
It used to be the case that people new to crypto were attracted by
bitcoin
Bitcoin
Bitcoin is the world’s first digital currency that was created in 2009 by a mysterious entity named Satoshi Nakamoto. As a digital currency or cryptocurrency, Bitcoin operates without a central bank or single administrator. Instead, Bitcoin can be sent via a Peer-to-Peer (P2P) networking, devoid of intermediaries.Bitcoins are not issued or backed by any governments or banks, and Bitcoin is not considered to be legal tender, although they do have status as an acknowledged transfer of value in some jurisdictions. Rather than composing a physical currency, Bitcoins are pieces of code that can be sent and received across a kind of distributed ledger network called a blockchain. Transactions on the Bitcoin network are confirmed by a network of computers (or nodes) that solve a series of complex equations. This process is called mining. In exchange for mining, the computers receive rewards in the form of new Bitcoins. Mining grows increasingly difficult over time, and the rewards get smaller and smaller. There is a total of 21 million Bitcoins. As of May 2020, there are 18.3 million Bitcoins in circulation. This number changes approximately every 10 minutes when new blocks are mined. Presently, each new block adds 12.5 bitcoins into circulation.Since its inception, Bitcoin has remained the most popular and largest cryptocurrency in terms of market cap in the world. Bitcoin’s popularity has contributed significantly to the release of thousands of other cryptocurrencies, called “altcoins.” While the crypto market was originally hegemonic, today’s landscape features countless altcoins.Bitcoin ControversyBitcoin has been extremely controversial since its original launch. Given its mercurial nature, Bitcoin has been criticized for its use in illegal transactions and money laundering.As its impossible to trace, these attributes make Bitcoin the ideal vehicle for illicit behavior. Moreover, critics point to its high electricity consumption for mining, rampant price volatility, and thefts from exchanges. Bitcoin has been seen as a speculative bubble given its lack of oversight. The crypto has weathered multiple collapses and survived over a decade so far. Unlike its launch back in 2009, Bitcoin today is viewed far differently and is much more accepted by merchants and other entities.
Bitcoin is the world’s first digital currency that was created in 2009 by a mysterious entity named Satoshi Nakamoto. As a digital currency or cryptocurrency, Bitcoin operates without a central bank or single administrator. Instead, Bitcoin can be sent via a Peer-to-Peer (P2P) networking, devoid of intermediaries.Bitcoins are not issued or backed by any governments or banks, and Bitcoin is not considered to be legal tender, although they do have status as an acknowledged transfer of value in some jurisdictions. Rather than composing a physical currency, Bitcoins are pieces of code that can be sent and received across a kind of distributed ledger network called a blockchain. Transactions on the Bitcoin network are confirmed by a network of computers (or nodes) that solve a series of complex equations. This process is called mining. In exchange for mining, the computers receive rewards in the form of new Bitcoins. Mining grows increasingly difficult over time, and the rewards get smaller and smaller. There is a total of 21 million Bitcoins. As of May 2020, there are 18.3 million Bitcoins in circulation. This number changes approximately every 10 minutes when new blocks are mined. Presently, each new block adds 12.5 bitcoins into circulation.Since its inception, Bitcoin has remained the most popular and largest cryptocurrency in terms of market cap in the world. Bitcoin’s popularity has contributed significantly to the release of thousands of other cryptocurrencies, called “altcoins.” While the crypto market was originally hegemonic, today’s landscape features countless altcoins.Bitcoin ControversyBitcoin has been extremely controversial since its original launch. Given its mercurial nature, Bitcoin has been criticized for its use in illegal transactions and money laundering.As its impossible to trace, these attributes make Bitcoin the ideal vehicle for illicit behavior. Moreover, critics point to its high electricity consumption for mining, rampant price volatility, and thefts from exchanges. Bitcoin has been seen as a speculative bubble given its lack of oversight. The crypto has weathered multiple collapses and survived over a decade so far. Unlike its launch back in 2009, Bitcoin today is viewed far differently and is much more accepted by merchants and other entities.
Read this Term. Then, having bought in,
altcoins
Altcoins
Altcoin is a term that describes any cryptocurrency that isn’t Bitcoin. Since Bitcoin’s inception there have been countless cryptos launched. Many of these have met varying levels of success, though several have risen to rival Bitcoin itself.Ether, XRP, Stellar, Monero, Ada, and Dash are a few examples of the more popular altcoins. There presently exist over 5,000 altcoins and this number seemingly grows constantly. The paramount altcoins as of May 2020 are Ethereum and Ripple.In terms of structure, altcoins can be different from the Bitcoin network in any number of ways. This is often the primary reason for the existence of altcoins themselves.Why Do So Many Altcoins Exist?While Bitcoin is both innovative and massively influential, it does possess some problems that developers are trying to fix with their own products. Over time there have been developed altcoins that makes faster transactions, while also altcoins that are less volatile, or altcoins that are more private, etc.Altcoins also can have different economic models and their methods of distribution can be different. Moreover, their programming languages can be different, and they can support the development of different kinds of applications. While many altcoins have been built with amazing technology and have amazing potential to change the world, many of them have been created as methods of grabbing quick cash, or even as jokes.However, some of the joke altcoins have still managed to gather a significant number of users and followers. The most prominent example of this trend is DogeCoin, a cryptocurrency inspired by the Doge meme. Additionally, other joke altcoins have also experienced large market cap, such as JesusCoin.
Altcoin is a term that describes any cryptocurrency that isn’t Bitcoin. Since Bitcoin’s inception there have been countless cryptos launched. Many of these have met varying levels of success, though several have risen to rival Bitcoin itself.Ether, XRP, Stellar, Monero, Ada, and Dash are a few examples of the more popular altcoins. There presently exist over 5,000 altcoins and this number seemingly grows constantly. The paramount altcoins as of May 2020 are Ethereum and Ripple.In terms of structure, altcoins can be different from the Bitcoin network in any number of ways. This is often the primary reason for the existence of altcoins themselves.Why Do So Many Altcoins Exist?While Bitcoin is both innovative and massively influential, it does possess some problems that developers are trying to fix with their own products. Over time there have been developed altcoins that makes faster transactions, while also altcoins that are less volatile, or altcoins that are more private, etc.Altcoins also can have different economic models and their methods of distribution can be different. Moreover, their programming languages can be different, and they can support the development of different kinds of applications. While many altcoins have been built with amazing technology and have amazing potential to change the world, many of them have been created as methods of grabbing quick cash, or even as jokes.However, some of the joke altcoins have still managed to gather a significant number of users and followers. The most prominent example of this trend is DogeCoin, a cryptocurrency inspired by the Doge meme. Additionally, other joke altcoins have also experienced large market cap, such as JesusCoin.
Read this Term and their potential gains might exert some pull, and newcomers would start to experiment with other trades.
It may now be that the sequence is happening in reverse. NFTs, through their links with visual arts, are an initial gateway into crypto. What’s more, the crypto that is first forayed into, if entering through NFTs, will not be bitcoin, but rather ETH, or possibly SOL, Tezos or ADA.
If and when bitcoin comes into the equation then it is more likely as an endpoint, a place to park profits, rather than as an initial entry.
Profits Stay in the System
When you get big sales in the NFT space it’s likely that those profits will stay in the ecosystem. An ETH whale surfaces from the depths, hurls money at a new mint and the recipients of that money then cycle it down across other projects.
And, this mechanism is not a bad thing, as wealth becomes distributed, liquidity flows and creativity is rewarded.
The NFT world is sometimes characterized as nothing but profiteering scammers out to make a quick buck, but while there are scammers and cash-grabs to be wary of, there are a remarkable number of hyper-cheerful Web3 evangelists, who not only benefit personally from NFTs but work towards helping others to benefit too, and regard what they are doing as genuinely transformative.
The crypto world was always a little offbeat, but with NFTs that unpredictability is amplified. NFTs are a component of the crypto ecosystem, traded and HODLed and flipped for profit, or liable to get you rekt, and yet there are some factors that distinguish NFTs from the rest of crypto.
Contempt
That is a strong word: contempt. But, it is true, NFTs set off a visceral reaction in some people. Strangely enough, you will see this particularly in parts of the art and gaming worlds. It is odd because NFTs bring fascinating new avenues to both art and gaming, and if you don’t care to go down those avenues, you can just not go down those avenues.
What I have seen is NFTs allowing artists and designers to take their work directly to the market, make initial profits, garner royalties and establish meaningful connections with enthusiastic collectors. And yet, NFTs have remained controversial in the art world. They are sniffed at as crass, trashy and irresponsible, but what could be more delicious than a bunch of sanctimonious art snobs having their party crashed?
Among gamers, the reaction can be even worse. Discord was always the social platform of choice for gamers, and so it was interesting when it was taken up (along with Twitter) by NFT projects. But, when Discord implied that it might integrate NFTs, an outraged rabble of users threw a tantrum, causing the company to backpedal.
A similar meltdown happened this month too, when OG games titan, Ubisoft announced it would be utilizing Tezos to produce blockchain games which include NFTs. Ubisoft has in fact been moving towards blockchain gaming for some time, but nonetheless, (some) gamers freaked out, and Ubisoft took down the trailer video for Quartz, its new NFT-incorporating gaming platform.
These reactions are baffling to observe, but what’s really fun is the reaction of NFT creators, collectors and believers. Basically, they don’t give a flying one, because they have diamond hands and crystal balls (no, I mean, they can see the future).
Emotional Attachment
NFTs with utility may be a good investment, but up to now, the most famous and expensive NFTs have been based purely around visuals. And, being non-fungible, they are unique.
This brings an additional component that distinguishes NFTs: emotional attachment. You will quickly offload a mid-cap altcoin as soon as you can make a profit. And, even with the more substantial coins whose fundamentals you believe in, and that you think have a long-term future, you might sell and buy back later.
But, that 8-bit koala with the 3D glasses? The llama smoking a pipe? My collection of intergalactic monkeys? Forget it, mate, hands-off.
A Few Good Traders
There appear to be fewer competent NFT traders than there are decent crypto traders.
Perhaps that is because NFTs attract a more arty design-focused crowd who are less interested in financial matters. There is the issue of emotional attachment, as mentioned. And, parts of the NFT world are based around collecting, which tends to mean people who hold on to what they buy, along with fewer potential takers if you decide to sell.
But, I also sense that quick trading is a little scorned. It is one thing to sell a bag of coins, but with an NFT, a certain amount of creative work has gone into it, and it might be a philistine move to simply flip it for profit.
Whether or not you care about being regarded as a philistine is another matter. But, from what I have witnessed, traders who intuit psychology, rather than those who focus on Technical Analysis, are likely to do better with NFTs.
A Gateway Drug
It used to be the case that people new to crypto were attracted by
bitcoin
Bitcoin
Bitcoin is the world’s first digital currency that was created in 2009 by a mysterious entity named Satoshi Nakamoto. As a digital currency or cryptocurrency, Bitcoin operates without a central bank or single administrator. Instead, Bitcoin can be sent via a Peer-to-Peer (P2P) networking, devoid of intermediaries.Bitcoins are not issued or backed by any governments or banks, and Bitcoin is not considered to be legal tender, although they do have status as an acknowledged transfer of value in some jurisdictions. Rather than composing a physical currency, Bitcoins are pieces of code that can be sent and received across a kind of distributed ledger network called a blockchain. Transactions on the Bitcoin network are confirmed by a network of computers (or nodes) that solve a series of complex equations. This process is called mining. In exchange for mining, the computers receive rewards in the form of new Bitcoins. Mining grows increasingly difficult over time, and the rewards get smaller and smaller. There is a total of 21 million Bitcoins. As of May 2020, there are 18.3 million Bitcoins in circulation. This number changes approximately every 10 minutes when new blocks are mined. Presently, each new block adds 12.5 bitcoins into circulation.Since its inception, Bitcoin has remained the most popular and largest cryptocurrency in terms of market cap in the world. Bitcoin’s popularity has contributed significantly to the release of thousands of other cryptocurrencies, called “altcoins.” While the crypto market was originally hegemonic, today’s landscape features countless altcoins.Bitcoin ControversyBitcoin has been extremely controversial since its original launch. Given its mercurial nature, Bitcoin has been criticized for its use in illegal transactions and money laundering.As its impossible to trace, these attributes make Bitcoin the ideal vehicle for illicit behavior. Moreover, critics point to its high electricity consumption for mining, rampant price volatility, and thefts from exchanges. Bitcoin has been seen as a speculative bubble given its lack of oversight. The crypto has weathered multiple collapses and survived over a decade so far. Unlike its launch back in 2009, Bitcoin today is viewed far differently and is much more accepted by merchants and other entities.
Bitcoin is the world’s first digital currency that was created in 2009 by a mysterious entity named Satoshi Nakamoto. As a digital currency or cryptocurrency, Bitcoin operates without a central bank or single administrator. Instead, Bitcoin can be sent via a Peer-to-Peer (P2P) networking, devoid of intermediaries.Bitcoins are not issued or backed by any governments or banks, and Bitcoin is not considered to be legal tender, although they do have status as an acknowledged transfer of value in some jurisdictions. Rather than composing a physical currency, Bitcoins are pieces of code that can be sent and received across a kind of distributed ledger network called a blockchain. Transactions on the Bitcoin network are confirmed by a network of computers (or nodes) that solve a series of complex equations. This process is called mining. In exchange for mining, the computers receive rewards in the form of new Bitcoins. Mining grows increasingly difficult over time, and the rewards get smaller and smaller. There is a total of 21 million Bitcoins. As of May 2020, there are 18.3 million Bitcoins in circulation. This number changes approximately every 10 minutes when new blocks are mined. Presently, each new block adds 12.5 bitcoins into circulation.Since its inception, Bitcoin has remained the most popular and largest cryptocurrency in terms of market cap in the world. Bitcoin’s popularity has contributed significantly to the release of thousands of other cryptocurrencies, called “altcoins.” While the crypto market was originally hegemonic, today’s landscape features countless altcoins.Bitcoin ControversyBitcoin has been extremely controversial since its original launch. Given its mercurial nature, Bitcoin has been criticized for its use in illegal transactions and money laundering.As its impossible to trace, these attributes make Bitcoin the ideal vehicle for illicit behavior. Moreover, critics point to its high electricity consumption for mining, rampant price volatility, and thefts from exchanges. Bitcoin has been seen as a speculative bubble given its lack of oversight. The crypto has weathered multiple collapses and survived over a decade so far. Unlike its launch back in 2009, Bitcoin today is viewed far differently and is much more accepted by merchants and other entities.
Read this Term. Then, having bought in,
altcoins
Altcoins
Altcoin is a term that describes any cryptocurrency that isn’t Bitcoin. Since Bitcoin’s inception there have been countless cryptos launched. Many of these have met varying levels of success, though several have risen to rival Bitcoin itself.Ether, XRP, Stellar, Monero, Ada, and Dash are a few examples of the more popular altcoins. There presently exist over 5,000 altcoins and this number seemingly grows constantly. The paramount altcoins as of May 2020 are Ethereum and Ripple.In terms of structure, altcoins can be different from the Bitcoin network in any number of ways. This is often the primary reason for the existence of altcoins themselves.Why Do So Many Altcoins Exist?While Bitcoin is both innovative and massively influential, it does possess some problems that developers are trying to fix with their own products. Over time there have been developed altcoins that makes faster transactions, while also altcoins that are less volatile, or altcoins that are more private, etc.Altcoins also can have different economic models and their methods of distribution can be different. Moreover, their programming languages can be different, and they can support the development of different kinds of applications. While many altcoins have been built with amazing technology and have amazing potential to change the world, many of them have been created as methods of grabbing quick cash, or even as jokes.However, some of the joke altcoins have still managed to gather a significant number of users and followers. The most prominent example of this trend is DogeCoin, a cryptocurrency inspired by the Doge meme. Additionally, other joke altcoins have also experienced large market cap, such as JesusCoin.
Altcoin is a term that describes any cryptocurrency that isn’t Bitcoin. Since Bitcoin’s inception there have been countless cryptos launched. Many of these have met varying levels of success, though several have risen to rival Bitcoin itself.Ether, XRP, Stellar, Monero, Ada, and Dash are a few examples of the more popular altcoins. There presently exist over 5,000 altcoins and this number seemingly grows constantly. The paramount altcoins as of May 2020 are Ethereum and Ripple.In terms of structure, altcoins can be different from the Bitcoin network in any number of ways. This is often the primary reason for the existence of altcoins themselves.Why Do So Many Altcoins Exist?While Bitcoin is both innovative and massively influential, it does possess some problems that developers are trying to fix with their own products. Over time there have been developed altcoins that makes faster transactions, while also altcoins that are less volatile, or altcoins that are more private, etc.Altcoins also can have different economic models and their methods of distribution can be different. Moreover, their programming languages can be different, and they can support the development of different kinds of applications. While many altcoins have been built with amazing technology and have amazing potential to change the world, many of them have been created as methods of grabbing quick cash, or even as jokes.However, some of the joke altcoins have still managed to gather a significant number of users and followers. The most prominent example of this trend is DogeCoin, a cryptocurrency inspired by the Doge meme. Additionally, other joke altcoins have also experienced large market cap, such as JesusCoin.
Read this Term and their potential gains might exert some pull, and newcomers would start to experiment with other trades.
It may now be that the sequence is happening in reverse. NFTs, through their links with visual arts, are an initial gateway into crypto. What’s more, the crypto that is first forayed into, if entering through NFTs, will not be bitcoin, but rather ETH, or possibly SOL, Tezos or ADA.
If and when bitcoin comes into the equation then it is more likely as an endpoint, a place to park profits, rather than as an initial entry.
Profits Stay in the System
When you get big sales in the NFT space it’s likely that those profits will stay in the ecosystem. An ETH whale surfaces from the depths, hurls money at a new mint and the recipients of that money then cycle it down across other projects.
And, this mechanism is not a bad thing, as wealth becomes distributed, liquidity flows and creativity is rewarded.
The NFT world is sometimes characterized as nothing but profiteering scammers out to make a quick buck, but while there are scammers and cash-grabs to be wary of, there are a remarkable number of hyper-cheerful Web3 evangelists, who not only benefit personally from NFTs but work towards helping others to benefit too, and regard what they are doing as genuinely transformative.
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