Over the past few months, NFT (or irreplaceable tokens) have been on everyone's lips. Brands from Givenchy to the NBA are getting in on the game. Their mainstream adoption has been so fast and so profound that last year Collins Dictionary even made the word the word of the year for 2021.

However, just because we've been talking about NFT doesn't mean that everyone is a convert to the cause. The fact that 9 of the top 10 NFT sales in the last 30 days (at the time of this writing) were Bored Apes or Cryptopunks – the two kings of NFT – proves that the broader NFT market has yet to capture the the public's imagination. If you've heard of NFT in the media, the article was probably illustrated with Bored Ape or Cryptopunk. Last year, a bundle of 101 Bored Ape NFTs sold for $24 million, and a Cryptopunk resold at Sotheby's for nearly $12 million. While countless new NFT projects are launched every day, traditional tokens with a defined resale value are still king.

Many media outlets portray NFT as a speculative asset for the rich, and the digital trend-tracking talismans of celebrities (think Jimmy Fallon, Post Malone and Eminem) explain some of their bad reputation. But another reason is that they make little sense to many observers. A comment that I think is completely wrong but worthy of rebuttal.

It is easy to see why non-cryptocurrency natives have difficulty understanding the concept of "irreplaceability" of digital assets. This new paradigm of digital ownership seems strange to many people who have right-clicked "Save As…" on an image or video (the primary media "cast" as NFT).

As a result, non-cryptocurrency media coverage is often disparaged. It doesn't have to be that way. The technology behind NFT is innovative and has great potential for a wide range of use cases. Whether this allows gamers to own and resell assets in the games they play. The nascent concept has a long way to go in order to prove ownership (or partial ownership) of physical assets such as property, or to help share music royalties more fairly.

The idea that code can prove the uniqueness, authenticity and provenance of a house, character skin or song in a decentralized, open and secure way is a profound idea. Smarter, more intuitive innovators than me will take advantage of this potential in the long run. But once again, many companies are going further, attaching tokens to convertible real-world benefits. Moving tokens from a digital asset to a type of club membership that provides ongoing value to token holders.

Tokens don't always have to have high-tech applications to provide value. At ThetaDrop, we are working with global brands such as Samsung, Katy Perry, Dionne Warwick, The Price Is Right and World Poker Tour to develop NFTs. In almost all of our partnerships, a key through-line is real-world rewards, or as they are known in the cryptocurrency community token "utilities" in the cryptocurrency community.

This doesn't mean that tokens without such use cases are as useless as their critics claim. We can't undervalue art for art's sake, or the community these tokens create around them. Nor will we write off the NFTs that are part of the PFP program; they are a combination of both. Like the currencies we use every day, NFTs are valuable because enough people agree with them to do so. If a community of collectors and enthusiasts wants to support an NFT project, either because of the shared values of a group or the attractive aesthetics of the token itself, then it's a worthwhile endeavor.

There are challenges to the widespread adoption and acceptance of NFT. One is climate change, although an exciting development is the broad scope and number of projects that promise to be not only carbon neutral, but also carbon negative. Proof-of-interest protocols like Theta use less than 1% of the energy needed for the same transaction on a proof-of-work protocol, which largely mitigates any environmental concerns about NFT. Creators and collectors are getting the message, and that can only be a good thing.

People often turn their noses up at news; sometimes this is due to a lack of understanding. If that's the case, I think the cryptocurrency community should take a small part of the blame. We are often too insular; too reluctant to explain what we are doing to people outside of our community. Sometimes this is for selfish reasons, sometimes it's because the task seems too difficult. Many mainstream journalists might also do a better job at this, by communicating the potential of the technology more clearly.

NFT is likely to become so common that the term itself may no longer be used. Instead, we will simply talk about ownership, and the technology behind it will be implied.

Guest post by Mitch Liu from Theta Labs

Mitch Liu is the co-founder and CEO of Theta Labs. Theta Labs pioneered Theta Network, the fastest and greenest blockchain for media and entertainment; ThetaDrop, the world's first real-time NFT marketplace; and THETA.tv, the leading decentralized live streaming platform.

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