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Crypto 101 – Understanding the different types of NFTs

Crypto 101 – Understanding the different types of NFTs
Investment1 min read
Crypto 101 – Understanding the different types of NFTs

Non-fungible tokens (NFTs)

Non-fungible tokens (NFTs)
Pixabay
  • Non-fungible tokens are unique in their own right and come in different shapes and sizes.
  • Digital artwork is the most popular form of NFTs, but other use cases like metaverse land and blockchain gaming are burgeoning in the ecosystem.
  • Brands are also jumping in on the trend through partnerships to customise avatars or set up shop in virtual worlds.
Non-fungible tokens (NFTs) are non-expendable tokens on the blockchain. Unlike Bitcoin, Ethereum and others, one can’t simply be exchanged for another because each NFT is meant to be unique. However, as unique as they are, they can largely be put into different category buckets.

Digital Artwork NFTs

Digital Artwork NFTs
Pixabay

Art is where most NFT stories started out. It’s one of the most popular forms of NFTs in the market today. Digital artwork NFTs can be anything from paintings to drawings to photographs.

Beeple’s Everydays:The First 5000 Days is one of the most popular examples of digital artwork NFTs, which sold for a whopping $69 million at a Christie’s auction in May last year.

Music NFTs

Music NFTs
Pixabay

Another form of NFTs is music. Tired of music piracy and intermediaries, artists are using NFTs to release music directly to the fans.

According to DJ Steve Aoki, he made more money from his NFT in 2021 than in a decade of making music. Even Indian bands like Euphoria have locked onto the trend with plans to launch their next album as an NFT.

Video clips and GIFs

Video clips and GIFs
Pixabay

If digital artwork NFTs are standalone images, then the motion version of these paintings and drawings can be turned into video clip and GIF NFTs. These NFTs can also be memorable sports moments, move highlights or behind-the-scenes clips.

In February last year, LeBron James’s Kobe Bryant Tribute Dunk – a 22 second clip – was sold for nearly $400,000.

Memes

Memes
Pixabay

Memes are quite an artwork but they’re not necessarily moving images either, which is why they get a category of their own. The Doge meme for instance, sold for a whopping $4 million in June 2021. Other memes to be sold as NFTs include Bad Luck Brian, Disaster Girl and Charlie Bit My Finger.

Avatars or PFPs

Avatars or PFPs
Pixabay

NFTs used as profile pictures or identities online fall into the category of avatars or profile picture collections like CryptoPunks, Bored Apes and Lazy Lions.

One particular collection can include thousands of unique avatars, the rarity of which is determined by their traits.

Video Game NFTs

Video Game NFTs
Pixabay

Blockchain games allow players to buy, collect and trade NFTs. These can be in the form of characters, creators, virtual weapons, skins or even in-game accessories.

Pokemon-like characters called Axies, from the game Axie Infinity, were among the most popular game NFTs in 2021.

Trading Card NFTs

Trading Card NFTs
Pixabay

Trading cards aren’t a revolutionary new use case. Instead, they’re the digital version of traditional collectible cards. And, just like traditional collectible cards, players can either trade them with others or store them simply as a collectible.

God’s Unchained and Sorare cards are a good example of trading card NFTs.

Metaverse Land

Metaverse Land
Pixabay

There are questions around whether auctioning metaverse land is the most sustainable NFT model, platforms like Decentraland and The Sandbox have been able garner brand recognition in the space.

Metaverses allow users to interact with the virtual ecosystem. Within that ecosystem, they can buy, sell, trade or own virtual real estate.

Virtual Fashion

Virtual Fashion
Clozette

If you’re going to have a virtual identity online, you’re going to need a wardrobe to go with it. This includes sneakers, hoodies, sunglasses, new skins and other customisation accessories for an avatar.

The Bored Apes already offer Adidas hoodies and accessories for its avatars. Other legacy brands like Ralph Lauren and Balenciaga have also created their own fashion NFTs.

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