Non-fungible tokens (NFTs) are now an integral part of the crypto ecosystem. Many people have entered the crypto industry through NFTs and many more people are picking interest because of it.
The market is already valued at $16 billion and expected to reach over $210 billion by 2030. This goes to tell you how much potential the industry has.
It’s easy to mix up NFTs with crypto assets such as Bitcoin, since they both use blockchains, but they are not the same. The fundamental difference is that NFTs cannot be broken into smaller units even though they are indeed tokens. In other words, they are non-fungible.
Each NFT also has unique characteristics and cannot be duplicated or traded for another token as is the case with crypto assets which can be exchanged for other assets.
Even though NFTs have the general quality of being non-fungible and unique, there are different types of it. In this guide, we discuss the different types of NFTs and what makes them different from the other types. The following are the different types of NFTs.
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Art and Collectible NFTs
If you know any NFT, it’s probably an art and collectible NFT because this is the most common type and the one most known among NFT users. They represent various types of digital art and collectibles, such as illustrations and animations.
Popular examples include Bored Ape Yacht Club and CryptoPunks, which have generated lots of revenue with the highest priced Bored Ape selling for $3.4 million.
Generative Art NFTs
These are art that are generated, as the name implies. This type of art is generated using autonomous systems, entirely or partially, artificial intelligence (AI) or algorithms to randomly generate music, literature or some other forms of visual content.
They represent collections such as CryptoPunks and BAYC. unique characteristics of these NFTs include the repetition of patterns, shapes, colors and motifs, and the randomness of composition.
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Gaming NFTs are a unique set of NFTs that people earn by playing or trading in a game. The term GameFi or gaming finance is a term that combines blockchain technology and NFTs with gaming resources to earn additional income in the P2E experience.
Gaming NFTs are used mainly in video games, and in the metaverse and virtual worlds as in-game assets such as land, characters and their unique features like skin type or an accessory.
NFTs have also found a place in fashion and it’s now a whole category of NFTs. Fashion companies started using branded NFTs in 2022, and the trend hasn’t looked back since.
For example, Dolce and Gabbana have launched digital-clothes-only NFT collections that could be used and worn by a personal avatar in metaverse platforms.
These NFTs have become more popular and fashion companies no longer mind creating more regardless of the state or the crypto market, whether bullish or bearish.
Event Ticket NFTs
These are NFTs used as digital event tickets. The tickets are minted on the blockchain as an NFT and can be auctioned off by the organizer or issued for free.
The tickets also become like a badge of honor long after the event is passed, and can be kept as a digital memory item.
With NFTs, it is now possible to own a digital identity. This identity is called a domain name and can be a registered digital name in games, social media or as addresses for websites hosted on a blockchain.
You can convert long, generic alphanumeric blockchain addresses into unique, memorable and easy to remember addresses as a means of digital identification.
Virtual Real Estate NFTs
With the coming of metaverse, it is now possible to own virtual real estate on platforms like Decentraland. These NFTs represent real estate ownership in video games and the metaverse.
Individuals, businesses, corporates to set up their virtual businesses such as fashion stores, residential and commercial lands, institutions etc on the blockchain.
Music makers and artists can now tokenize their music. This way, there can be no counterfeit of the music and anyone who pays for the NFT owns the music
This is good for both the artist and the consumer of such content, as it brings income to the artist and the buyer can earn as the value of the NFT rises in the future.
Published content can now be tokenized into an NFT. This allows authors, journalists and other content creators to monetize their articles, books and blogs in the form of NFTs, ensuring that such creators are properly rewarded and those consuming their content don’t get pirated copies.
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