The “non-fungible tokens” (or non-fungible tokens in French) make it possible to authenticate digital objects, but also physical ones. Unregulated, they can pay big or… nothing at all.
Appearing in 2018, NFTs designate both digital property certificates and objects. They remain very unknown to the French: according to an Ifop survey for Cointribune, only 8% of them know what they are and 3.5% have bought them. Insights from Claire Balva, co-founder of Blockchain Partner and director of blockchain & crypto-assets at KPMG France.
Paris Match. What is an NFT?
Claire Balva. It is a token generated on a digital infrastructure called blockchain that represents a specific asset, which can be digital or physical. We talk about a non-fungible token because the main characteristic of an NFT is its unique nature. Unlike a cryptocurrency like bitcoin, which is interchangeable: one bitcoin is worth another bitcoin. NFTs are not equivalent to each other.
What are the most common uses associated with NFTs?
The first sector concerned is that of video games, thanks to the advent of games accessible for free, monetized by the sale of objects, weapons or advantages. Until now, the assets of a video game were partitioned in its database, without the possibility of being used elsewhere once the game was over. Put in the form of NFTs, these assets can be resold, or even circulate outside the original game, on other platforms.
Before investing, you must carry out a thorough analysis of the issuer, the platform
NFTs have fostered the emergence of new practices…
They make it possible to constitute a kind of collection and to have the certainty that a digital object is unique, or that it only exists in a limited number of copies. It is on these principles that the model of Sorare is based, a start-up which carried out the largest fundraising in France in 2021 (680 million euros). She developed a fantasy football game from collectible digital player cards.
How to explain the rise of NFT in the artistic world?
A work can be represented in the form of NFT, which acts as a certificate of ownership and authenticity. NFTs can designate both the digital object and the associated certificate. Entirely digital creations such as images or clothing can be sold in virtual universes. This is what drives luxury or sportswear brands to invest in NFTs, particularly for marketing reasons.
Also read. A virtual house sold for more than 500,000 dollars
What precautions should be taken before investing in digital works of art?
Impossible to position yourself without having understood the universe of cryptocurrencies. Beyond the aesthetics, it is necessary to carry out a detailed analysis, by questioning the issuer of the NFT, the platform which markets it, the price history. Such a purchase must only be made in a logic of diversification of its savings, in an ancillary way. An exception to these principles: the purchase of a work by your favorite artist, if your driving force is not the expectation of a capital gain.