Even though non-fungible tokens (NFTs) cannot be considered mainstream (yet), interest has reached beyond the cryptosphere, especially due to online migration during the pandemic. NFTs are designed to offer something that cannot be copied: ownership of the work, which in the legal sense is a digital certificate of ownership of or rights to a unique asset, ownership of which is recorded as a unique token on a blockchain.
Commercially, NFTs are mostly used to sell digital art. The purpose of NFTs is simply to be tradable and limited making it a superb playground for the mega-rich considering the crazy figures tokens are sold at. Without a doubt, there is a lot of buzz and controversy about NFTs. One notable downside is that most NFTs are tied to energy-hungry cryptocurrencies that generate a lot of greenhouse gas emissions. Work can be done to mitigate the issue but currently, NFTs have a negative effect on climate change.
Being all new and exciting, 2021 can be seen as the year of the NFT. That year NFTs began to shake up the art and tech world, changing owners for crazy amounts of money. However, interest has ebbed away leaving the NFT scene with a ground-breaking early momentum letting us wonder about its comeback. As everything within the crypto realm, it is difficult to predict if something is over and done with for good or if an even bigger boom is waiting right around the corner. The fact is, since then full fletched NFT-based communities emerged convinced of the value and opportunities of NFTs. For artists, NFTs present a channel to sell work for which there usually would not be a market and there is even the possibility to get paid a percentage every time the NFT is sold or changes hands maximising the benefit. As a buyer, you get the chance to support artists and get some basic usage rights with a blockchain entry as proof. No doubt, in the NFT communities owning NFTs also serve as a way to show off. For collectors, NFTs can also work like any other speculative asset.
This year NFTs are said to become more functional, rather than just something to collect. It is all about creating exclusive experiences and offering insider-y access. Starbucks is about to launch its own NFT functioning as an access pass, rock band Kings of Leon is also exploiting NFTs by offering golden tickets. Sports teams are sure to follow together with other big corporations, slowly but surely making NFTs more mainstream within the next two to three years.
NFTs have evidently also reached the Maltese Island, aka ‘Blockchain Island’, with crypto and metaverse enthusiasts investing in NFTs long before it hit the news. At the Malta Film Week in January, experts discussed how NFTs can change film, branding and storytelling. Furthermore, Malta-based gaming and entertainment conferences show the possibilities of blockchain-based gaming seemingly creating a new ecosystem with NFT integration. A prominent example of a Maltese NFT project is “ETH in Mellieha” which revolves around a prestige license plate by Transport Malta and a digitalized painting by artist Debbie Bonello bedded in a unique experience.
As it seems, the Maltese Government is also hopping on the NFT bandwagon seeing interesting opportunities for digital innovation. Economy Minister Silvio Schembri stated that “Malta can place itself as a well-known jurisdiction with a good and trusted reputation for NFTs”. With a regulatory framework on the way, hopes are that Malta´s economy will flourish with the next boom. Malta as a crypto-savvy iGaming Eldorado and known as a fast-adapting jurisdiction surely has the ingredients to become a hotspot of the next NFT movement.
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