Another way to monetize NFTs is to license them for use in other projects. For example, if you have created an NFT of a piece of artwork, you could license it to be used in a video game, a movie, or a product. This can be an excellent way to generate ongoing revenue from your NFTs, as the license fee will be paid each time the NFT is used.
Tech Strategy Consultant & Entrepreneur, Golden Next Ventures
Samrat Kishor is a tech strategy consultant turned entrepreneur and tech investor. He specialises in the fields of Blockchain and AI and can be reached at @samratkishor on twitter and LinkedIn.
Non-fungible tokens, or NFTs, are digital assets that represent ownership of a unique item or piece of content, such as a digital artwork or collectible. They have gained popularity recently as a way for artists, collectors, and investors to buy and sell unique, digital items. They are stored on a blockchain and can be bought and sold like other assets, but they are not interchangeable because they are one-of-a-kind, hence the phrase “Non-Fungible.”
Overall, there are many different types of NFTs, and the use cases for NFTs are constantly evolving. NFTs can be used in a variety of industries and can be used to represent ownership of a wide range of digital assets.
There are several types of NFTs, including:
- Art NFTs: These NFTs represent ownership of digital art, such as a painting, drawing, or photograph. Art NFTs can be created by artists, sold to collectors, or used as part of a larger product or service offering.
- Collectible NFTs: These are NFTs representing ownership of a collectible item, such as a virtual trading card or a digital toy. Collectible NFTs are often used as part of online games or a more extensive product or service offering.
- Virtual Real Estate NFTs: These are NFTs representing ownership of virtual real estate, such as a virtual land or building. Virtual real estate NFTs can be used as part of online games or a larger product or service offering. A flip side to virtual real estate NFTs is (real) real estate NFTs such as those being issued by upcoming PropTech player Hiraya Realty.
- Event NFTs: These are NFTs representing ownership of a ticket to a live event, such as a concert or sporting event. Event NFTs can be used to securely and digitally manage ticket sales and distribution.
- Gaming NFTs: These are the NFTs used as part of online games, such as virtual items or in-game currency. Players can buy and sell gaming NFTs to enhance gameplay or as part of a larger product or service offering. An example of such NFTs is those planned to be issued by Genblock Singapore.
To monetize NFTs successfully, it is crucial to have a clear plan and strategy in place. This may involve creating a solid marketing plan to promote your NFTs, making them visible to potential buyers, and establishing partnerships and relationships with other businesses or organizations interested in using or licensing your NFTs. It is also essential to clearly understand the legal and regulatory environment surrounding NFTs, as this can vary depending on the jurisdiction in which you operate.
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View Details »Overall, NFTs offer a unique and innovative way to monetize digital assets and can be a valuable tool for creators, businesses, and organizations looking to generate revenue from their digital creations. By understanding how NFTs can be monetized and developing a clear plan and strategy, you can effectively monetize your NFTs and generate ongoing revenue from your digital assets.
There are several ways to monetize NFTs:
- Create and sell NFTs of your own artwork or other digital content. If you are an artist or creator, you can use NFTs to sell your work and retain ownership. You can create and list your NFTs on a marketplace such as OpenSea, Rarible, or SuperRare, and set the price you want to sell them for. If someone buys your NFT, you will receive the sale price minus any fees the marketplace charges.
- Another way to monetize NFTs is to license them for use in other projects. For example, if you have created an NFT of a piece of artwork, you could license it to be used in a video game, a movie, or a product. This can be an excellent way to generate ongoing revenue from your NFTs, as the license fee will be paid each time the NFT is used.
- Invest in NFTs created by other artists or content creators. If you are an investor, you can buy NFTs to diversify your portfolio and earn a return on your investment. You can research and evaluate the potential value of different NFTs based on factors such as the artist’s reputation and the uniqueness of the content. Keep in mind that investing in NFTs carries risks, as the market is still relatively new, and the value of NFTs can fluctuate significantly.
- NFTs can also be used as part of a larger product or service offering. For example, you could create an NFT that grants access to a subscription service or a special event. You could also create an NFT that serves as a ticket to a concert or other live event.
- NFTs can be used as part of a fundraising campaign for a charitable cause or a personal or business project. For example, you could create an NFT that represents a donation to a charity and sell it to raise funds for the charity.
- Earn royalties from NFTs you have created. Royalty-bearing Non-Fungible Tokens (NFTs) are digital assets that give the owner a share of the revenue generated from using the NFT. Royalty-bearing NFTs can be a good option for creators looking to monetize their work, as they can generate ongoing revenue from using their NFTs. They can also be attractive to buyers, as they may see the potential for long-term value in the NFT. For example, if an artist creates an NFT of a piece of artwork and sells it as a royalty-bearing NFT, the owner of the NFT may be entitled to a percentage of the revenue generated from the sale of prints or licensed use of the artwork. However, it is essential to carefully consider the terms of any royalty-bearing NFT before purchasing it. It is crucial to understand how the royalties will be calculated and paid and to ensure that the terms are fair and reasonable. It is also essential to be aware of any legal or regulatory considerations surrounding the use of royalty-bearing NFTs.Some NFT marketplaces offer the option to set up a royalty system, where you can earn a percentage of the sale price every time your NFT is resold. This can be an excellent way to continue earning income from your NFTs even after you have sold them.
There are several risks to consider when using Non-Fungible Tokens (NFTs):
- Lack of regulation: The use of NFTs is not currently regulated by any central authority, making it difficult to protect your rights as a buyer or seller of NFTs. There is also a risk that NFTs could be used for illegal or fraudulent activities, such as money laundering or selling counterfeit items.
- Volatility: The value of NFTs can be highly volatile and may fluctuate significantly in a short period. This can make it difficult to accurately value an NFT and can result in significant losses if the value of the NFT declines.
- Lack of liquidity: NFTs are less widely accepted than traditional forms of currency, making it difficult to sell an NFT if you need to cash out. This lack of liquidity can also make it difficult to determine the fair market value of an NFT.
- Technical risks: There is a risk that the technology used to store and manage NFTs, such as the blockchain, could fail or be hacked. This could result in the loss or theft of your NFTs.
- Fraud: There is a risk that NFTs could be sold fraudulently or that the ownership of an NFT could be disputed. It is vital to carefully research any NFT you are considering buying and to only buy from reputable sources.
It is essential to remember that making money using NFTs carries risks, as the market is still relatively new, and there are no guarantees about the value of NFTs. It is an excellent idea to do your own research and consult with a financial advisor before making any investment decisions. Overall, it is crucial to be aware of the risks associated with using NFTs and carefully consider whether they are a suitable investment. It is also essential to be mindful of the legal and regulatory environment surrounding NFTs, as this can vary depending on the jurisdiction in which you operate.
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)Saturday, 07 Jan, 2023Experience Your Economic Times Newspaper, The Digital Way!Read Complete Print Edition »
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