What problem do NFT tokens solve?

4 Min Read

The categories on OpenSea give us a clue as to what problems NFTs – and NFT tokens – can solve. Because it is not right to talk about just one problem. Overall, it can be said that modern society is moving in a direction where everything is increasingly digitized – and where many companies and organizations are trying to be more or less “paperless”. This is far more than just a buzzword.

And it certainly also makes sense to abolish paper to a certain extent – for several reasons. First of all, there is a huge waste – both of money and of the rainforest. It may not seem like a big expense, but for large corporations with branches in multiple countries, dealing with millions – or billions – of papers each year can be a grotesque expense. In addition, the papers need to be stored and organized so that one can find them if or when they are needed. For these – and many other – reasons, we’ve been working for a long time to reduce paper waste. But there are still certain documents that live on in the paper form. Almost everything that has to do with law is an example of this.

It is difficult to imagine that one e.g. buys a house but never sees a document or other papers in that regard. But what if you could get a document that was unique – of which there was indeed only one copy – and which you could transfer and access digitally, but which other people could not access without your permission? It is precisely these kinds of scenarios that can be solved by NFT.

Music is perhaps a better example. When music was digitized, there were a number of years where musicians all over the world suddenly earned much less than they were used to, as music was constantly being copied and distributed. But by e.g. to release a new album like NFT, one might want to make sure that every digital copy is unique – and that a copy can therefore be traced back to the first person who made it. In this way, one can better ensure that rights to art and music are respected.

The same model can in principle be used for textbooks, audiobooks, etc. It is strictly speaking only our imagination that sets the limits of the possibilities. This is also one of the reasons why there is a big battle between the various blockchains – such as. Ethereum, Tezos m.v. – to become the best facilitator of these solutions. Everyone knows they’re coming. But no one knows exactly when and how exactly this new field will look.

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Posted by Alex Vartmann
Web3 guru, and enjoys sugary liquorice.