NFT Companies
What Is a NFT company?
An NFT token is a unique digital asset based on blockchain technology. It represents a special class of cryptocurrency that has common features with it (protection against forgery, transparency of transactions, and others). But at the same time there are obvious differences – for example, indivisibility. If 1 bitcoin consists of 100 million satoshi, and you can receive or send assets of any denomination (11 or 0.009 BTC), then NFT exists only in a single version. It cannot be divided into its component parts.
To put it very simply, a non-fungible token is a proof of purchase that confirms the right to own a certain coin that is associated with a tokenized asset. As the latter, there can be an object of the real and virtual world that has a value:
financial contracts.
Objects, avatars or characters of computer games.
Digitized installations.
cultural objects.
Collectible items.
Musical records and videos.
Analysts believe that the boom around the NFT sector will continue in 2022. There are many objective reasons for this:
The emergence of virtual blockchain realities has greatly changed the game mechanics. Users have become interested in projects that work on the Play-to-Earn (P2E) principle. Many promising NFTs in 2022 are related to the world of online games and metaverses.
Big financial companies and famous brands (Gucci, Nike, Adidas) have appeared on the market. Digital art has been around for a long time, but the emergence of non-fungible tokens has greatly changed the way art is bought and sold. In addition, a mechanism has appeared that provides protection against forgery. This was the impetus for the development of the entire market.
Who Is the Biggest NFT Company?
What are the most promising NFT companies in 2022? 2021 has become a stellar year for projects related to non-fungible assets. The turnover of money in trade transactions involving NFTs increased 220 times. If before only fans and enthusiasts of cryptocurrencies were interested in unique tokens, then in 2021 large investors, auction houses, gaming platforms and well-known sports brands began to invest in this segment.
The excitement around the new trend not only attracts buyers, but also stimulates the creation of virtual objects. Mostly they are artists and creative people. The rating of NFT tokens (top 3), if you pay attention to the most expensive of the sold assets, looks like this:
A collage of paintings by Mike Winkelman, an American artist, worth $69.35 million. He sold the work through an auction at Christie's. This immediately made Beeple (Mike's pseudonym) one of the most expensive artists of our time.
$28.9 million digitized sculpture of Human One. This is another work by Mike Winkelman.
Pixel art from the CryptoPunks collection, number 7523, was sold for $11.75 million.
Experts believe that the growth of the market for NFT companies in 2022 will be inevitable. There are all conditions for this. Beyond crypto art, this format of digital assets is in demand in the industry of computer games, DeFi and metaverses. Many domestic coins from these directions have become liquid financial assets that are listed on major exchanges.
Below is a list of top NFT projects and NFT companies that will be interesting as investment objects in 2022.
CryptoPunks
A review of the most promising NFT companies should start with one of the first collections of digital avatars released by Larva Labs. The project started in 2017 and initially was not of a commercial nature. The developers wrote a special program that, when run, generated images of 24 x 24 pixels. The difficulty was that the digital characters were unique.
The developers set a goal to combine artistic elements with proof of ownership and an offline registration mechanism. The experiment was successful, 10 thousand cryptopunks were created. At first they were offered to everyone for free, but as the popularity grew, the project became commercial. In January 2022, sales (including on the secondary market) amounted to $1.98 billion. The most expensive token was number 7523. In June 2021, it was sold for $11.8 million.
Bored Ape Yacht Club
“Bored Monkey Yacht Club” is the name of a collection of NFT art that appeared in April 2021. Artists and project creators remain anonymous. On forums and online platforms, they use pseudonyms and avatars. The company that issued the tokens is Yuga Labs, located in the US state of Virginia.
All 10,000 monkeys were sold before the end of the year. Moreover, the boom in NFTs occurred suddenly, the first month they were bought very weakly. The starting price was 0.08 ETH (about $370) per unit. In September, a series of 107 images sold for $24.4 million at Sotheby's.
Deciding to use this popularity, artists from Yuga Labs released two more collections – "Mutant Monkeys" and "Pet Club". At the beginning of 2022, the total capitalization of all platform tokens is $2.2 billion.
The Sandbox
The gaming platform in terms of goals and appearance strongly resembles Minecraft, which has been popular in recent years (second place in the history of selling electronic games). The difference is that the Sandbox is based on the Ethereum blockchain, and all the internals that the player can make are NFTs. This means that they belong to the user account and not to the developers.
Such assets can be exchanged or sold on the marketplace for real money. Moreover, the game currency SAND already has its own value and is traded on exchanges. The total capitalization of the token at the beginning of 2022 is $3.6 billion. The asset is in 35th place in the rating of the CoinMarketCap website.
Cool Cats
Another collection of non-fungible tokens consists of 9999 randomly generated avatars. The project appeared in the summer of 2021 at the peak of popularity and general interest in digital art objects. To create images, as with cryptopunks, software was used with which you can get more than 300 thousand unique features of Cool Cats (color, style, face and clothing elements).
The support of Mike Tyson played a big role in popularizing the collection. He changed his Twitter avatar to one of the cats. This immediately increased the demand for NFT tokens. In the fall of 2021, Cool Cats developers published information about the release of an additional series of Cool Pets and $MILK tokens. In the 6 months since the launch of the project, trade deals worth more than $239 million have been concluded.
Art Blocks
The platform on the Ethereum blockchain was one of the first to start releasing generative collections based on art objects. This mechanism can be represented as follows:
The artist digitizes their work and uploads it to the platform.
The rules (algorithm) are determined according to which the base model will change (composition, size of elements and their placement, colors). There are no restrictions, it all depends on the imagination of the artist.
After saving the parameters, the generation of NFT tokens begins.
The result is obtained not only in the form of a flat drawing. You can play a 3D composition or model that will move. Thanks to this mechanism, entire collections are created, all elements of which have a common theme.
In June 2021, Art Blocks launched the Fidenza series, authored by Tyler Hobbs. The collection contains 999 unique artworks. At the beginning of 2022, this is the most popular series of digital paintings on the Art Blocks project. For example, Fidenza #313 was purchased for 1,000 ETH, and on the secondary market (Opensea marketplace), a work from the same collection, numbered #531, was sold for $12.4 million.
SuperRare
This NFT company has the functions of a marketplace, a gallery and a social network for creative people. SuperRare launched in 2017. The project is managed by Pixura. Now SuperRare is a well-known virtual digital art gallery. Not every artist can exhibit their work on the site. First, you need to fill out a form and confirm the copyright for the art object, which will be converted into an NFT token. If the work corresponds to the format of the platform, the gallery curators offer the artist cooperation.
FLUF World
A series of 3D rabbit avatars are used in this metaverse. They were generated by software. For this, 240 different personality traits are used in 14 categories.
The collection consists of 10 thousand elements. Owning at least one of them provides access to exclusive content, additional services offered by the company. For example, one can purchase a virtual property called Burrows, which serves as a meeting place for FLUF and other avatars.
Decentraland
Decentraland NFT company is a game metaverse developed according to the principles of the Ethereum decentralized ledger. Unlike other games of this class, Decentraland pays great attention to the social and economic component. All game items and real estate are unique ERC-721 tokens.
Users can create them themselves (with the exception of the land plots themselves) or buy them in the marketplace.The internal cryptocurrency also uses the Ethereum blockchain (ERC-20 standard) and is called MANA. In 2021, when the hype around the NFT rose, the price of the game coin increased by more than 15 times. At the beginning of 2022, MANA ranked 30th in terms of capitalization.
Foundation
This NFT company provides interaction between providers of digital creativity and potential buyers. In order for the artist to be able to put his work up for sale, he must have an Invite – an invitation card. They get it from a community member (when joining, everyone is given 5 invites) or in the Discord channel of the Foundation marketplace. Although there is a lot of competition on the platform, you can wait months for an Invite.
Developers do not store NFT tokens and digital works of art themselves. The Foundation acts as an intermediary that connects stakeholders. All payments go through smart contracts.
Axie Infinity
An online game with fantastic characters named Aksi was created on the Ethereum blockchain. All Axies are NFT objects. The rights to them belong to the players, not the producer of the metaverse. Participants need to breed, raise pets and improve their fighting qualities. After that, they can be sold or put up for competition. Some users from third world countries earn large sums in games.
Do NFT Companies Make Money?
For many, the field of non-fungible tokens seems too complicated to understand. Therefore, people are afraid to invest in virtual pictures or game characters. Investments in such projects can bring high returns. There are several options:
Speculation or direct investment. Money is invested in the purchase of any NFT for the purpose of subsequent sale (when the price of it rises). It is important to remember that unique tokens are an asset with low liquidity. Its value is subjective and there are no guarantees that in the future there will be a chance to resell it ten times more expensive.
Purchase of native assets of the ERC-20 format. Well-known NFT companies have an internal virtual currency that can be used as play money, service or control tokens (RARI from the Rarible platform or SAND from The Sandbox metaverse). Such an investment implies more active actions on the part of the investor. It is necessary to monitor the development of projects, changes in exchange rates that are traded on the exchanges. For example, with the growing popularity of the Sandbox game, the user currency SAND has risen to 35th place in the ranking by capitalization.
Loan of cryptoassets secured by NFT. There are services that organize the receipt or issuance of loans with collateral in the form of ERC-721 or ERC-1155 tokens. An example is NFTfi, a synthesis of decentralized finance technologies and non-fungible tokens. The principle of operation is similar to that of a simple pawnshop. To receive cryptocurrency (ETH), you need to leave a digitized value as a pledge. If the loan with interest is not repaid, the unique object will go to the lender.
There are several special platforms for trading with unique digital assets:
OpenSea is the largest marketplace. This site was the first to fully switch to NFT trading. The number of lots put up for sale is never less than 1.5 thousand. On the example of this top platform, one can observe how the development of the entire direction of non-fungible tokens is going on. The turnover of OpenSea in 2020 amounted to $21 million, and in 2021 it exceeded $10 billion. New NFT projects are exhibited on this platform immediately after launch.
Binance – in the summer of 2021, the crypto exchange opened access to the NFT marketplace for its users. Due to the developed infrastructure, the new platform immediately took one of the top positions in the ranking of similar enterprises.
NBA Top Shot – the project sells collectible basketball cards. Unlike the paper prototype, the digitized ones contain the best episodes of past games (NBA). Each such clip is a non-fungible ERC-1155 token.
Rarible is a platform for digital creativity. The main directions of the presented works are paintings and photographs. There is an official RARI coin that pays for the NFT issue.
Pros and Сons of Investing in NFTs
NFTs have become popular quite recently, in 2020-2021. This makes them convenient for speculation and even fraud. At the same time, unique blockchain items can be a good financial instrument both in the short term and when hedging risks.
Digital art, like traditional art, can show price growth for a long time if there is interest. Many non-interchangeable items are evaluated subjectively (popularity, hype). But this situation can suddenly change, and assets will fall heavily in value.
The use of smart contracts ensures that artists receive payment and buyers receive an NFT token. Creating and implementing unique elements requires resources. Commission fees sometimes exceed the amount the owner will receive after the sale. Blockchain technologies make it difficult to fake NFTs. The concept of unique digital art is difficult to explain to people who are far from the world of crypto art.