With NFTs and digital assets bursting into the scene recently there’s been a lot of misconceptions and myths surrounding the entire industry. This is mostly due to the sheer complexity of the industry and a pretty high barrier to entry that has caused a lot of stigma to be built around the topic as a whole.
Myth 1: There is No Real Intrinsic Value in NFTs
A lot of people say that there is no true value in NFTs and it’s just all a fad. However, it’s good to note that NFT’s are non-fungible. This means that the ownership of the NFT lies solely with one person.
Since all NFT and digital asset trades happen on a blockchain, there is a ledger that cannot be altered, changed or edited meaning that the true ownership of an NFT or a digital asset is set in stone. Thus, any copies or fakes created online are just that - fakes.
There can be multiple copies of the same NFT but only one original piece. This can be compared to high end art pieces around the world. We might all have a copy of Vincent Van Gogh’s The Starry Night saved in our harddrive somewhere but there will only be one original version of the painting.
In addition to that, NFTs gain their value from overall underlying value, the non-fungible aspect, the perception of buyers and the promise of its future value. This is what makes NFTs and digital assets valuable.
Myth 2: NFTs Are Just All Digital Art
NFTs being non-fungible tokens are basically one-of-a-kind digital properties or items that have their proof of ownership being kept in a blockchain like Ethereum. Non-fungible just means that it’s something that cannot be replaced with something else, therefore ensuring that your NFT is purely unique and only available to you.
NFT’s aren’t just ONLY digital art. At the end of the day, NFTs can come in the form of music, podcasts and literally anything that can be digitised.
Some other things that can also be transformed into NFTs are:
Collectible items such as trading cards
Ownership of in-game assets
Music & various forms of media
Big sports moments
This allows for a lot more digital information being able to be stored in blockchains allowing for easier and safer storage of information.
Myth 3: NFTs Are A Get Rich Quick Scheme
The exponential growth in returns for NFTs and digital assets as a whole recently has alluded to some that anything in the world of digital assets would be an investment with ridiculously high returns in a short period of time.
This also meant that when NFTs broke into the scene, that this was the reality of this new form of digital asset. With that also comes the fact that naysayers believe that it’s all a get rich quick scheme or just an overcomplicated cyber scam.
In all honesty, since there is no main entity or company that governs all the NFTs, it’s a little hard to prove that it’s all a scheme to get someone in charge rich quick or that it’s a pyramid scheme of some sort, like so many that are claiming that. Although, we would still advise extreme caution when it comes to doing any transaction online, including trading digital assets and NFTs in general. Always do your research and ensure that you know what you’re getting yourself into at all times.
At the end of the day, NFT’s are like any other investment piece where its worth can change from one day to the next just like company stocks or even property investments. Regardless, in every industry, especially those deeply rooted in investments, we must always stay vigilant as there will always be people out there, truly looking for a quick buck. Always stay well informed of all your choices and the people & platforms you choose to invest in.
Myth 4: NFTs Are Bad For The Environment
This has been a long-standing concern about the industry as a whole. This stems from the fact that NFT mining and trade takes a lot of energy due to the constant mining. Right now, since a lot of NFT trades happen on the Ethereum network that does use a considerable amount of energy, this might not be the case in the near future.
Blockchains like Tezos & Cardano, that use proof-of-stake to process their transactions use a lot less energy as a whole. Since Ethereum will be completing its transition from the Mainnet with the Beacon Chain, and complete The Merge, it will use ~99.95% less energy post merge.
Regardless, the industry is well aware of the impact it's having on the planet and they are taking some considerable steps to improve this overall. A lot of miners have also moved to countries which have cheaper energy and also those that harvest their energy from renewables.
Myth 5: NFTs Are Easily Copied Which Can Allude To Theft
There is a common misconception that NFTs can easily be copied since they’re considered digital assets freely available to view and search for on the internet. However, NFTs have something called metadata which governs the overall ownership of NFTs. And since NFT works on blockchain, there isn’t really a way to “steal” NFT art. Blockchains are distributed ledgers (consolidated information) which you can store any type of information you want. Blockchain information cannot be changed or rewritten. This means that for every NFT purchase, there is an accurate and permanent piece of information that mentions the artwork and who made it. It will also keep a detailed record of its owners, etc. These rules are against commercially reproducing any NFT images and these rights often don't even belong to the owner of the NFT.
This means that, sure, it’s easy to take a picture of an NFT and pass it off as an original, but it’s also as easy to check the database to conclude if it’s original or a fake.
Regardless, at the end of the day, in every industry, there will be people out there trying to scam you out of your money. If you want to start investing in NFTs or digital assets, we strongly suggest that you do as much research as you can to ensure that you are on top of all the information that you need to make an informed decision.
Staying safe online!
Here are some of the best ways you should keep an eye out for to ensure you stay safe financially online.
Stay up to date with all NFT & digital asset news from their respective platforms.
Always follow verified spaces to ensure that you get the correct information.
Avoid phishing emails
Phishing scams are literally everywhere. And this is the same even in the NFT & digital asset world.
Always beware of overall emails you get when it comes to those quick cash schemes.
Pay with reputable sources & get the most out of your money
Always pay attention to who you’re sending your money to. Stay safe online and save money with BigPay since we have proper analytics, better exchange rates, lots of airasia points up for grabs and a support team that’s ready to assist in any way they can!
Stay safe out there friends!
This document has been prepared for informational purposes only and does not constitute an offer or the solicitation of an offer to purchase or to sell any securities, products or services by BIGPAY. Although the information contained in this document has been compiled and obtained in good faith, it has not been independently verified and no representation or warranty, express or implied, is made and no responsibility is or will be accepted as to or in relation to the accuracy, reliability or completeness of any such information. Any information and opinions expressed herein may be subject to change without prior notice. BIGPAY will not be responsible for any consequences resulting from the use of this document as well as the reliance upon any opinion or statement contained herein or for any omission. This document is confidential and may not be reproduced (in whole or in part) nor summarised or distributed without the prior written permission of BIGPAY. BIGPAY. All rights reserved.