The creator of the Cardano (ADA) blockchain discusses the brief history of non-fungible tokens (NFTs).
Charles Hoskinson takes listeners through a list of possible use cases that NFTs could fulfil as the sector develops in a new Twitter space that he hosts.
“NFTs are useful for anything that you have a collection of or that is connected to something other than a standardisation. As an example, consider a land deed. Mining rights. Water rights are important. Any understanding of property rights. Any notion of your character progressing throughout the game in the GameFi [gaming and decentralised finance] space. Your actions within the game. All of the special abilities you gain, as well as the rewards you earn, can and should be tokenized at some level.
They can also represent experiences. They can represent accomplishments, such as diplomas. Credentials. Obviously, if you attended medical school and graduated, that is unique to you. It is not fungible; it is unique. NFTs, as a format, are useful in each of those areas, in my opinion. As a result, it is a larger space than the fungible world. You can also securitize them. You can convert anything that is an NFT into something that is associated with a revenue stream.”
Hoskinson then discusses his own interest in the space and how he and the Cardano ecosystem intend to participate.
“What I want to do is just get involved with the high-level, you know, metaverse, GameFi, and something related to collectibles and then watch how those things evolve. And then I’ll worry about things like governance, interoperability, and the like, while the commercial people figure out how to make money.
A large portion of what is at the end of the rainbow will be complicated intellectual property negotiations. License transactions. For example, we’ve talked about how to represent a patent portfolio as an NFT. How to sell the rights to the portfolio and then turn that into interest-earning future profits.
Patents can be securitized as a non-diluted way of securing capital for a business. For example, if you are a pharmaceutical company, you must sell stock. You can pre-sell a portion of your patent portfolio in the hopes of making money. There’s a lot of small things that can be done.”
The Cardano creator also believes that NFTs will play an important role in how brands and influencers connect with their audiences, possibly beginning with video sharing platform TikTok.
“Tokenization of brands is also becoming more transparent, especially in a world where I believe influencers and TikTok users will be the first wave to tokenize their brands…
To be honest, the growth and scale of the NFT space has taken me by surprise. It’s gone from nothing to something substantial in a very short time.”
