January 7, 2022
NFTs continue to take the crypto world by storm, their impact and applications to the various industries are yet to be fully realised. India Atkin, Associate at Wiggin LLP spoke to Business Leader about the sector.
With players from Elon Musk to Melania Trump, whether you have an interest in NFTs or not, there’s a good chance it’s popped up on your social feeds. But with a vastly unregulated space and lots of uncertainty surrounding NFTs themselves, figuring out how they work and how they can be profitable continues to be a thorny issue.
NFT stands for ‘Non-Fungible Token’, which, at its simplest, is a digital or physical asset created on the blockchain, a digital, decentralised ledger. Being created on the blockchain encodes the NFTs most valuable characteristic – its uniqueness, since the NFT contains within itself information about its origin story, and its chain of ownership.
The Play to Earn Model
Supported by a vast network of over 3.24 billion gamers and counting, the digital entertainment industry is worth an eye-watering $160 billion. If you’re a gamer, it’s easy to understand why – it’s fun. The Play to Earn (P2E) model is gaining popularity in the gaming space, where players can earn money through the acquisition of NFT versions of popular in-game items (such as skins and weapons) which players can keep, trade or cash-out on digital marketplaces.
The rise of the P2E model hints at a future where workplaces are in online games. Vietnamese games developer Sky Mavis’s blockchain game Axie Infinity, for instance, was able to pay a rate reported three times better than minimum wage in the Philippines amid the 40% unemployment rate.