Technologies
Why Tiger Woods, Tom Brady and others are joining in on the NFT craze
Tiger Woods is the latest to sell digital collectibles as NFTs. But how much are they going for nowadays? We’ll explain.
You’ve probably heard about NFTs, short for nonfungible tokens. But what exactly are they? It’s a new type of digital asset similar to cryptocurrency that can cost you a lot of money. The craze began in 2017, and since then, Twitter’s Jack Dorsey, rock legends Kings of Leon and even Tiger Woods have sold NFTs for a pretty penny (more below).
But what exactly are you buying when you purchase an NFT? It’s not a collectible that you can keep in your dresser drawer, like Pokemon cards, a comic book or paintings. They’re entirely digital and are tied to almost anything — a video highlight, a meme or even a tweet.
If this doesn’t make much sense to you, well you’re not alone.
In short, NFTs offer a blockchain-created certificate of authenticity for a digital asset or piece of art. The interest has created a digital market that boasted $250 million in sales in 2020, with NFTs reaching new levels of hype from Visa, Warner Music Group and Nike. Even toilet paper companies are in on the latest cryptocurrency wave. Still confused? We’ll break down what NFTs really are, how much they cost and how you can get in on the latest bidding wars.
What’s an NFT?
This is the part that takes a bit of open-mindedness. An NFT is a unique digital token, with most using the Ethereum blockchain to digitally record transactions. It’s not a cryptocurrency like Bitcoin or Ethereum, because those are fungible — exchangeable for another Bitcoin or cash. NFTs are recorded in a digital ledger in the same way as cryptocurrency, so there’s a listing of who owns each one.
What makes an NFT unique is the digital asset tied to the token. This can be an image, video, tweet or piece of music that’s uploaded to a marketplace, which creates the NFT to be sold.
Do I own the asset if I own an NFT?
Nope.
That’s the real kicker to understanding the whole concept. The person who buys the NFT doesn’t own the actual asset.
“NFTs challenge the idea of ownership: digital files can be reproduced infinitely and you do not (usually) buy the copyright or a license when purchasing an NFT,” said Jeffrey Thompson, associate professor at the Stevens Institute of Technology in Hoboken, New Jersey.
For example, the creator of the Nyan Cat meme sold an NFT of it for $590,000. The person who bought the token owns the token, but doesn’t actually own the meme. That still belongs to the creator, who held onto intellectual and creative rights.
What the owner of the token has is a record and a hash code showing ownership of the unique token associated with the particular digital asset. People might download Nyan Cat and use it on social media if they want, but they won’t own the token. This also means they can’t sell the token as the owner can.
Why are NFTs so expensive?
As with physical collectibles such as Beanie Babies, baseball cards and toys, there’s a market for NFTs. The buyers tend to be tech-savvy individuals who understand the idea of wanting to purchase digital goods and likely made a killing this past year with cryptocurrencies. Ethereum, for example, went from just over $100 last March to a current price of about $3,400. In some cases, buyers are just flexing their digital wallets to show off how much crypto they have, but for others, there’s a deeper interest.
“Specifically for art-related NFTs, there is a huge surge in demand due to their novelty and creativity of early artists,” Jason Lau, chief operating officer of crypto exchange OKCoin, said in an email. “Whether it’s a physical work with an attached NFT (think of it as a digital autograph and proof of veracity), or an entirely digital work (where the NFT is the art), this new medium is opening new ways for collectors and artists to explore their relationship with the artwork itself.”
It’s also great for the artists, says Lau. By selling digital art directly to those interested, an artist can begin monetizing work without having to try to sell it in a gallery.
What kind of NFTs can I buy?
NFTs can be tied to any digital asset. Anything you see online can be an NFT — music, social media posts, clip art and more. Today, Sorare released its “Super Rare” Lionel Messi digital trading card that’s currently bidding at €29,992.75, equivalating to over $35,000. Sorare also announced that it raised $680 million for its next-level sports fantasy game. The funding is currently led by SoftBank.
And today, Tiger Woods will sell thousands of digital collectibles on Autograph on the DraftKings marketplace. The second collection will launch on Sept. 28. Autograph is co-founded by Tom Brady, another athlete in the NFT market.
But NFTs are going far beyond sports. Recently, Fortune gave its readers a chance to get in on the NFT craze. The company sold 256 copies of the limited edition cover from the graphic artist Pplpleasr for Fortune’s August/September magazine on OpenSea. The copies sold out within five minutes starting at $1 Etherum (estimated $3,000). But the NFTs were available for resale at three times the cost.
And in August, a clip art of a rock, better known as Ether Rock, was sold for $400,000 Etherum (estimated $1.3 million). Two weeks ago, it was valued at $97,716. And in August, Visa announced its NFT CryptoPunks purchase for $150,000 in Ethereum. The financial corporation believes that NFTs play a big role in the “future of retail, social media, entertainment, and commerce.” And Vine’s co-creator, Dom Hoffman, is reportedly inventing a new way to gamify NFTs with his fantasy gaming console, Supdive.
As the hype for NFTs grows, expect more digital assets to come up for sale and bring in some big money.
Where can I buy or sell an NFT?
While you may not want to jump right in bidding six figures, there are multiple NFT marketplaces out there to check out, with Opensea being the biggest. Buyers can search for art, domain names and random collectibles to bid on without having to break the bank. And Woods’ digital collection is one of the many NFT collections available on DraftKings marketplace, including Tony Hawk’s collection.
On the other hand, if you want to sell an NFT of your art, you can use NFTify, the Shopify NFT store, to sell NFTs without creating your own store. You’ll also need a MetaMask account to get going. And Burberry recently announced a partnership with Mythical Games to gamify buying, selling and collecting toys as NFTs through the Blankos Block Party game. CNET’s own Chris Parker also made a step-by-step guide on how to make and sell your own NFT, in the video below.
What are the downsides of NFTs?
A drawback is the hundreds of dollars in fees required to create an NFT. If you’re making your own token on the Ethereum blockchain, you need to use some Ethereum, which as mentioned earlier is kind of pricey. Then after you make an NFT, there’s a “gas” fee that pays for the work that goes into handling the transaction and that’s also based on the price of Ethereum. Marketplaces simplify the process by handling everything for a fee when an NFT is sold.
There’s also an environmental cost. Like Bitcoin, Ethereum requires computers to handle the computations, known as “mining,” and those computer tasks require a lot of energy. An analysis from Cambridge University found that mining for Bitcoin consumed more energy than the entire country of Argentina. Ethereum is second to Bitcoin in popularity, and its power consumption is on the rise and comparable to the amount of energy used by Libya.
Technologies
Trump strikes deal with Putin to supply Russian diesel to U.S. and global markets
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Technologies
Major League Baseball proposes shortening its regular season as it pushes for a salary cap
Major League Baseball proposed a return to a shorter 154-game regular season schedule as it attempts to convince players to approve a salary cap.
Major League Baseball proposed shortening its regular season to 154 games from 162 as it attempts to convince players to approve a salary cap in the league’s next collective bargaining agreement. The new shortened schedule would begin in 2029.
MLB’s CBA expires Dec. 1, after the conclusion of this season’s World Series. The most contentious issue is the introduction of a salary cap on players. MLB is the only major American sports league without a cap. The league has failed to convince the players’ union to adopt one in several previous CBA negotiations.
A 154-game season was used between 1904 and 1960, except for 1918 and 1919 when the schedule was abbreviated because of World War I. For the past 66 years, 162 regular season games has been the standard, though some seasons have been shortened.
Lopping off eight games “is good for player health, while also creating a new national broadcast window to showcase our most exciting teams and players,” MLB spokesman Glen Caplin said in a statement. “A shorter regular season unlocks making October even better for our fans — with fewer weekday afternoon games, a longer Division Series, and more opportunities to see the game’s best pitchers on the biggest stage.”
As part of the proposal, MLB wants to cement Monday as an exclusive broadcast window for one or two games to “increase national exposure for the sport.” The league could conceivably sell a package of Monday-only games to a streaming service looking to increase subscriber and advertising revenue. Every team not playing in the national game or games would have an off day.
Teams that play Monday would be off on Thursday, MLB said.
In addition to lowering the number of regular season games, MLB would extend the divisional round of the playoffs to seven games from five and would allow the higher-seeded teams in both the wild card round and in the divisional round to choose their lower-seeded opponent.
The Major League Baseball Players Association responded to the MLB’s proposed changes by claiming the league “once again made clear that all of its proposals are contingent on players’ agreement to a salary cap, a system that guts player rights and compensation, as well as its other anti-player proposals.”
An MLB spokesperson confirmed that Thursday’s proposed changes are contingent on adopting a cap – and a salary floor, which would force teams to spend a certain amount on players. Still, the MLBPA said it would review the proposed changes. “Players will weigh in on these proposals and we will respond at the bargaining table,” MLBPA said in a statement.
Technologies
Hurricane Isaias disrupts U.S. oil production in Gulf of Mexico, threatens refineries
The hurricane could tighten a fuel market that is already facing big disruptions from the wars in Eastern Europe and the Middle East.
Hurricane Isaias is disrupting U.S. crude oil production in the Gulf of Mexico and could limit about 2% of the country’s refining capacity, at a time when fuel markets are already tight around the world.
Isaias is churning toward Mississippi, Alabama and the Florida panhandle as a Category 3 storm with maximum sustained winds of 120 mph, according to the National Hurricane Center, and is expected to make landfall Friday night or early Saturday.
As of Thursday, oil companies had shut in about 1.3 million barrels per day, or roughly 63% of total U.S. production in the Gulf, according to the Bureau of Safety and Environmental Enforcement.
The hurricane appeared to be veering away from the dense refining region in southern Louisiana near New Orleans and Baton Rouge.
But the storm could affect Chevron
“Of course, losing any refinery capacity when diesel supplies are at their lowest level for this time of year since the EIA began reporting in 1982 is not a good thing,” Lipow wrote in a Friday note, referring to the Energy Information Administration.
Chevron’s refinery at Pascagoula remains operational, spokesperson Ross Allen said Thursday. Vertex officials weren’t immediately available for comment about its Saraland refinery.
″The biggest risk to these two refineries are a loss of electricity or flooding damage,” Lipow wrote in a note Friday. If the refineries do shut down, it would take one to two weeks to restart them if they did not sustain damage, he said.
Refineries on the Gulf Coast are running at 95% of their capacity, so there is no slack in the system to make up for lost production, Lipow said.
Diesel prices have soared as the wars in Eastern Europe and the Middle East knock out refining capacity. Ukraine’s strikes on Russian refineries forced Moscow to ban diesel exports. Iran and its Houthi allies have also attacked refineries in the Middle East.
U.S. refiners have stepped in to take advantage of wide profit margins to export diesel around the world, particularly to Europe.
In the past, fuel prices rose while crude prices fell during outages at Gulf refineries, said Kevin Book, managing director at ClearView Energy Partners. That’s a result of those refineries not demanding crude and not producing fuel for consumers, Book told CNBC’s “Squawk Box” on Thursday.
Lipow warned that tanker traffic will also be disrupted.
“Tankers will be delayed delivering crude oil to the refineries while other tankers are delayed loading gasoline, jet fuel and diesel out of the refineries,” the analyst said. “Florida will experience delays in receiving gasoline, jet fuel and diesel.”
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