NFT assets vs Internet files
NFTs and Ethereum solve some of the problems that exist in the internet today. As everything becomes more digital, there's a need to replicate the properties of physical items like scarcity, uniqueness, and proof of ownership. Not to mention that digital items often only work in the context of their product. For example you can't re-sell an iTunes mp3 you've purchased, or you can't exchange one company's loyalty points for another platform's credit even if there's a market for it.
Here's how an internet of NFTs compared to the internet most of us use today looks...
A comparison
An NFT internet | The internet today |
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NFTs are digitally unique, no two NFTs are the same. | A copy of a file, like an .mp3 or .jpg, is the same as the original. |
Every NFT must have an owner and this is of public record and easy for anyone to verify. | Ownership records of digital items are stored on servers controlled by institutions – you must take their word for it. |
NFTs are compatible with anything built using Ethereum. An NFT ticket for an event can be traded on every Ethereum marketplace, for an entirely different NFT. You could trade a piece of art for a ticket! | Companies with digital items must build their own infrastructure. For example an app that issues digital tickets for events would have to build their own ticket exchange. |
Content creators can sell their work anywhere and can access a global market. | Creators rely on the infrastructure and distribution of the platforms they use. These are often subject to terms of use and geographical restrictions. |
Creators can retain ownership rights over their own work, and claim resale royalties directly. | Platforms, such as music streaming services, retain the majority of profits from sales. |
Items can be used in surprising ways. For example, you can use digital artwork as collateral in a decentralised loan. |