The blockchain ecosystem is becoming more complex and diverse thanks to NFTs. This new type of utility attracts a wider audience.
The blockchain-cryptocurrency sector is a little more than a decade old and still fighting an uphill battle for widespread acceptance. Those who have closely followed the industry’s rise know its potential to solve the biggest problems plaguing legacy financial systems, but before crypto can go truly mainstream, it must first reckon with some of its own inherent shortcomings.
Crypto-based payments are significantly slower than traditional payment methods, except in certain cross-border cases. Although faster transactions may be possible, they are not affordable for everyone. Network congestion is often caused by slow transactions and long settlement times. We saw this in 2017 with CryptoKitties. Scalability is an issue for all existing protocols and blockchains.
Beyond these technical limitations, myths and misunderstandings abound in the blockchain-cryptocurrency domain, which presents significant obstacles to onboarding. Those skeptical about cryptocurrencies often perceive it as “magic internet money” with little or no value in the real world, or worse, a means for criminals to transact shady business outside of the watchful eye of financial regulators. This is despite only 0.34% crypto-based transactions being used for criminal activity worldwide.
The gluttony of cryptocurrency’s energy consumption is often a problem. A Bitcoin transaction consumes twice the energy that a U.S. household uses over a month. Globally, large-scale Bitcoin mining operations use huge amounts of fossil fuels for their servers farms. This contributes to our greenhouse gas emissions. Some businesses have started to work with energy companies to make use of excess energy which might otherwise go to waste.
These issues are being addressed by Bitcoin and Ethereum through innovative innovations such as the Lightning Network or Ethereum 2.0. While emerging blockchain platforms have many promising features, mainstream adoption of them is far from a reality.
In spite of these and other obstacles, the burgeoning community of crypto enthusiasts have put tremendous effort into spreading awareness and education—which is steadily coming to fruition. We are also seeing a gradual shift towards wider adoption as innovative solutions are created to make the experience easier for amateurs. Let’s take a look at some of the major catalysts of this change.
NFT Collectibles
Non-fungible tokens, or NFTs, are one of the latest and most innovative developments in the blockchain industry. While NFTs can be used for many purposes, their primary purpose as collectibles is the most important. NFTs caught the fancy of crypto enthusiasts beginning in 2017 with CryptoPunks, and have since become cultural artifacts, unfolding one of the most important chapters in blockchain’s history.
NFT-based collectibles are not mere JPEG images sitting idle in their owner’s crypto wallet. As a virtual status symbol, people are purchasing these assets in order to display them publicly on social media. Twitter is working with users to allow them to verify their ownership of NFTs. show them offYour profile. NFTs also have the potential to be much more than mere collectibles—fractionalization is possible, for instance, and so are DeFi derivatives.
Torum, a company that focuses on the growth of NFT and Crypto Community, recently invested in KuCoin Labs. Torum’s NFT marketplace is powered by their token XTM, which helps meet the NFT-centric needs of crypto communities. The team will link users through a SocialFi (Social Finance), ecosystem that allows cryptocurrency projects and users to collaborate. They already claim to have nearly 200,000 followers according to their Twitter.
Another market player lowering the barrier to entry to NFTs among new and existing crypto users is Chronicle, a marketplace creating authenticated digital collectibles for the world’s biggest brands, including for stars of stage, screen, and television. Chronicle is a platform for legally licensed NFT collection sellers and buyers. The user-friendly platform accepts credit cards and debit cards.
Play-to Earn (P2E), Games
With the market cap for top gaming tokens at $52billion, blockchain-powered gaming is quickly becoming an international phenomenon. Many traditional gamers already know the concept of in-game assets. These include weapons, vehicles and loot boxes. Around these in-game economies, entire new worlds have been created.
Decentralized protocols, such as NFTs or other blockchain-based innovations that leverage NFTs, are elevating in-game assets and gaming to an entirely new level. Unlike traditional gaming, where assets are confined to individual games’ worlds, tokenized in-game assets have real monetary value transcending the games’ virtual boundaries, and persist even if the game ceases to exist. A new paradigm in gaming has emerged: P2E or Play-to Earn.
People had to find creative ways to survive in a post-pandemic economy. P2E was a popular choice. Although the prospect of making real money playing video games can be thrilling, the emphasis on economics often comes at the cost of poor gameplay or visuals. The sector is evolving, though, and quite rapidly, with participatory and people-centric titles like what we are seeing from Iron Sail, Whydah’s GameFi hub that has received $25 million funding from major blockchain ventures.
Running on KardiaChain, Iron Sail’s Mytheria is an NFT trading card game set to release in the coming months that adds a whole new layer to the Play-to-Earn model: Create-to-Earn. Artists can submit their artwork and create games that generate revenue. Thetan Arena, another Iron Sail game, has accumulated more than 5,000,000 users in just 2 weeks. The number of users who log in daily has reached its highest point of 2,000,000, according to the company.
User-Oriented Services & Privacy Prioritization
Another notable outcome of leveraging Blockchain technology is the disruption of user-oriented services such as Data Management Platforms and Creator Economies. These services can be improved by blockchain-based solutions, which provide better security, privacy and transparency. This is especially true for sensitive and personal data. Not only does this benefit content creators and enterprises, but it also benefits end-users. ARPA and other companies have enabled us to go beyond the ordinary encryption of cryptographic keys in this area.
Felix Xu from ARPA, the CEO, has attended Art Basel 2021 Miami to meet with NFT artists. Xu said that ARPA’s Randcast technology uses cryptographic methods to provide a secure, fast, and affordable way for projects to generate onchain verifiable random numbers. The transparency in minting NFTs and blockchain gaming can be improved by verifiable randomness.
How Do You Tip The Iceberg
Although it is still relatively young, crypto has reached a market capital of $2.57 trillion. However, there has been a decline in its value since the beginning of the year. Crypto companies will find new ways to attract new users as blockchain innovation continues to improve. As more investment is made in crypto, the industry will soon adopt user-friendly technology to mass adoption. By any measure this is an exciting time, and we’re still at the very beginning of the blockchain and cryptocurrency story. This story may lead to an enormous and worldwide-moving tech boom with echos from the early days internet.
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