Non-fungible tokens (NFTs) have seen rapid adoption and evolution throughout 2021, birthing various unique projects across industries. Widely considered the future of the digital art market, top auction houses, fashion retailers, rock bands, and restaurants were quick to jump on the bandwagon of the top NFT assets.
NFTs are truly smart contracts on a blockchain that help authenticate and trace digital assets. Those assets have usually been visual digital artworks but can be other digital assets, such as songs or videos. The key difference between the top NFT assets and crypto is that they cannot be traded or exchanged one-to-one.
While art has always been a comparable niche asset class, the rise of digital assets has made NFTs more valuable than ever. As a result, museums today are adding top NFT assets to their portfolios. At the same time, art dealers and auction houses like Christie’s are spotlighting the trendiest NFT artists. Christie’s auction of digital artist Beeple’s work for a huge $69 million highlights. It shows how much money has flowed into these crypto assets.
Table of contents
- What Are Non-fungible Tokens (NFTs)?
- Definition and Examples of Non-fungible Tokens (NFT)
- How Do Non-Fungible Tokens Work?
- Top NFT Assets in Crypto Market
What Are Non-fungible Tokens (NFTs)?
Non-fungible tokens (NFTs) are unique digital assets that are based on blockchain technology. Anything can enhance an NFT as a piece of art, sports memorabilia, or even a tweet. However, unlike cryptos that also use the blockchain network for ownership verification, one NFT cannot exchange directly with another NFT.
NFTs have existed for several years but reached a level of traction in 2020. In 2019, the NFTS traded in the US was $62.86 million. But in 2020, the entire volume was over $250 million, with an increase of 300%. Still, it is not just the overall volume. Top NFT assets are raking in big bucks. For example, Christie’s auctioned off an NFT-based artwork by Mike Winkelman in March 2021. Notably, this is now famously recognized as “Beeple” for $69.3 million.
Moreover, top NFT assets also contain ownership specifications for easy identification and transfer between token owners. In addition, owners can also add metadata or characteristics to the asset in NFTs. For example, tokens symbolizing coffee beans can be notified as fair trade. Or, artists can sign their digital artwork with their trademark in the metadata.
NFTs grew from the ERC-721 standard. Generated by some of the same people accountable for the ERC-20 smart contract, ERC-721 defines the minimum interface – ownership details, security, and metadata – required to exchange and distribute gaming tokens. The ERC-1155 standard brings the idea further by decreasing the transaction and storage costs necessary for NFTs and batching multiple types of non-fungible tokens into a single contract.
Definition and Examples of Non-fungible Tokens (NFT)
NFTs are tokens offering ownership of digital assets. This claim is verified through algorithms on the blockchain. Most of the top NFT assets use the Ethereum network
for verification. Some track the origins of NFTs back to tokens named Colored Coins in 2012. Colored coins were essentially bitcoins that were “colored” to give them unique properties to distinguish them from the rest of bitcoins and had value independent of the face value of the underlying bitcoin.
They emerged as CryptoPunks, digitally generated characters, and the first NFT on the Ethereum network in 2017. But NFTs became popular a little later in 2017 with the advent of Cryptokitties, a digital gaming platform on the Ethereum network that allowed buying, selling, and digital breeding of cats. The craze hooked on soon enough, and in 2018, a Cryptokitty sold for 600 Ethereum—the equivalent of $170,500.
In March 2021, CryptoPunk auctioned for 4,200 Ethereum or the equivalent of $7.57 million. You may have noticed top NFT assets in the news, such as artwork, valuable sports trading cards, or computer-generated avatars. In addition, many artists and other creatives are producing original works for distribution as NFTs. In early March 2021, Twitter CEO Jack Dorsey auctioned his first-ever tweet from 2006 as an NFT. It sold for $2.9 million approximately 2.5 weeks later.
How Do Non-Fungible Tokens Work?
You can think of a non-fungible token as the proof of ownership of an asset verified by the blockchain. Thus, blockchain is like an electronic ledger of transactions that serves as a record of NFT ownership. Computers across the world verify every transaction on the blockchain by solving complicated math problems.
The transaction history and data associated with an NFT are made public on the blockchain and cannot be changed once verification is complete. Therefore, not only can an NFT owner prove their claim without a doubt, but it can also not be stolen.
This makes top NFT assets useful in some industries, and some have already begun to see their adoption.
NFTs may work appropriately in industries such as art or other creative spaces that might otherwise be subject to unofficial copies and fraud. Thus, top NFT assets have the potential to restrict this type of fraud.
Sports memorabilia often has high collectible value, and NFTs may not only offer fans a way to improve the experience but also provide a way to prove authenticity and ownership of the high-value memorabilia. For example, NBA Top Shot sells NFTs of player moments during games. There may also be a use case for top NFT assets in the ticketing of sporting events.
Licensing or Smart Contracts
NFTs have applications in smart contracts in association with intellectual property. This may propose solid opportunities for owners of several types of intellectual property to license the use of these assets. In addition, the use of blockchain to save the contracts may help assure that all users are aware of ownership and limitations on using these assets, such as the royalties paid on the use of music. For example, the primary owners or creators of the EulerBeats Originals still earn an 8% royalty every time they sell NFT.
An NFT can be the digital symbol of ownership on a blockchain network in the real estate world. For example, rather than a paper deed declaring that you own a single-family house, you could have an NFT showing your ownership of that house. This can give some advantages in terms of safety and ease of access.
Top NFT Assets in Crypto Market
The following will list the top NTF assets on the crypto market. They are often cited as top NFT assets on the Ethereum blockchain.
CryptoPunks3100 is the rarest and most valuable CryptoPunk globally, with a current value of $11.1 million (4,200 Ether). On March 11, 2021, they sold it for 4,200 Ether, which had a value back of $7.58 million. This CryptoPunk is one of nine Alien punks, the unique series of the 10,000 CryptoPunks that exist.
In addition, CryptoPunks3100 features a headband, which only 405 other punks have. Before the record-breaking sale in March, Punks3100 had only sold one other time in 2017 for 8 Ether, $2,127 at the time. CryptoPunks3100 is the most expensive singular NFT ever sold so far – there have been many extensive collections, like Beeple’s Everydays: The First 5000 Days sold as NFT for tens of millions of dollars.
CryptoPunks7804 is one of the few CryptoPunks that comes with a bit of documented history. On the same day that CryptoPunks3100 was sold, Dylan Field, CEO of software startup Figma, also sold CryptoPunks7804 for 4,200 Ether valued at $7.57 million at the time of the sale.
Moreover, the field had purchased the highly valuable CryptoPunk in 2018 from its original owner for only 12 Ether, $14,988 at the time. CryptoPunks7804 now belongs to an anonymous investor known on Twitter as “Peruggia.” CryptoPunks7804 features a pretty rare combination of accessories: a Cap Forward worn by 253 other punks, an exclusive Pipe used by 316 other punks, and Small Shades worn by 377 other punks.
Meebits’ ownership is a standard ERC-721 with the NFT contract that works with any compatible service or exchange. Also added to the contract is a custom marketplace that helps like-kind trading of up to 100 Meebits per transaction. Along with all the usual buy, bid, and ask transactions.
Meebits10761 is the most valuable Meebits. On May 13, 2021, they sold it for 700 WETH, which had a value back of $2.7 million. This Meebits is one of 20,000 3D voxel personas built by a custom generative algorithm then registered on the Ethereum blockchain.
SuperRare is a US base running since 2018. It works on the ETH blockchain, the NFTs are ERC-721 NFTs. But, if you are looking for affordable top NFT assets from unknown artists, you might find them here as well. But most of the NFTs created and sold here are provided by more well-known NFT-creators. As a result, the list of creators with NFTs sold on this marketplace is very long.
SuperRare14, issued on March 24, 2021, sold for $1.79 million. However, this NFT places it number four for the top NFT assets with a current value of 1,000 ETH, $1.73 million. Notably, the key focus of SuperRare is exclusive digital art.
CryptoPunks6965 is currently the rarest Ape punk, which is the second rarest CryptoPunk series, with only 24 Apes ever made. Moreover, the fedora-wearing Ape punk sold on February 19, 2021, for 800 Ether $1.54 million at the time, which was a record high for CryptoPunks before it broke it a month later. Besides, CryptoPunks6965 sold three times before it’s a record-high sale, for a few thousand dollars each time.
Currently, CryptoPunks6965 is on sale by its owner for 2,100 Ether, about $5.5 million at this time. So far, one offer creates for 2,100 Ether back on March 14 when it was worth $3.9 million. However, the owner of CryptoPunks6965 did not accept.
On May 4, NFT marketplace OpenSea reported that the highest ever selling single item on the platform had just sold for 420 ETH or around $1.4 million at the time. The top NFT asset was Meebits8598, a pixelated 3D character from the same company that created CryptoPunks in mid-2017, Larva Labs. Once again, the sale has generated NFT bubble headlines as the sky seems to limit what people will pay for these novelty non-fungibles.
CryptoPunks1190 is one of 88 Zombie punks. The punk is currently held by address 0x43fb99. However, this punk has not been listed for sale by its owner. So, unfortunately, there are no bids on this punk as of this time. Moreover, CryptoPunk1190 holds 7th place for top NFT assets. With a total value of 400 ETH, equivalent to $1.41 million on May 18, 2021.
Beyond doubt interest in NFTs and their market size, as a result, both are on a surge. In the days to come, new deals will take place, and the list will change. Experts believe that the craze for NFTs will continue for a long, ranging from art and videos to songs and tweets. Also, it will stabilize in the second quarter of 2021, as compared to the first.
However, the surge during the first quarter connects to people spending more time online during the lockdown. In addition, the momentum was boosted by a newly evolved group of crypto-rich speculators keen to leverage digital asset price gains.
Disclaimer: The views and opinions expressed in this article are solely the author’s and do not necessarily reflect the views of CoinQuora. No information in this article should be interpreted as investment advice. CoinQuora encourages all users to do their own research before investing in cryptocurrencies