CRYPTOCURRENCY

Why NFTs Matter in the Volatile World of Cryptocurrency

And how it will shape the industries we hold dear

The title of this article could just as easily be, “Don’t throw the baby out with the bathwater.” NFTs are real and here for the duration. Here’s why.

If you’ve been following the mad world of crypto, and especially if you’ve invested, you might feel queasy from the roller coaster ride. While there are many points of contention, most everyone agrees that there will continue to be a cryptocurrency shakeout. It’s just hard to say who will be the winners. The losers we read about daily.

So, with that in mind, I will make the case that NFTs will be important no matter who the winners are.

At the meta-level, NFTs are a tool that offers authenticity, proof of ownership, tracking capabilities, and more.

While NFT stories of cartoony figures on tiles worth millions strain our credulity, many use cases exist where NFTs bring substantial value. That is why NFTs will continue to matter.

First, a recap on what exactly is an NFT

NFT stands for “non-fungible token” and is basically a way of attesting that your digital asset is authentic. “Fungible” assets are like dollar bills — all worth the same. “Non-fungible” applies to digital assets like artwork or music that are unique. In this case, NFTs authenticate ownership via a “token.”

An easier way to think of NFTs is as a one-of-a-kind digital asset whose proof of ownership cannot be duplicated. When a piece of art is copied, an NFT will certify that the owner has the original.

There are many use cases for NFTs being applied in various industries. Below are three examples where NFTs are reshaping our business world.

Example #1: Real estate

The real estate industry is one of the most NFT-ready sectors. NFTs can be used to transfer land deeds, provide proof of ownership, and even keep track of changes in property value using time-stamping.

NFTs are particularly useful in helping to simplify and speed up real estate transactions. Through the use of a “smart contract,” automatic payment can be made for properties.

Another example of where NFTs can be useful in the real estate market is if you want to rent your property, but you need a convenient and secure way to do so. This example is referred to as the “decentralized home rental services market” — decentralized because it is individuals engaging in a rental transaction. Because NFTs reside on a blockchain with relatively strong security that protects sensitive data like credit cards, they can aid you in the process and make the transaction easier.

A company called Propy has pioneered the development of NFTs for real estate. They represent real estate ownership by assigning NFT to property and placing it on the blockchain. They also provide all relevant legal documents. This makes doing business much easier.

Example #2: Medical records

HIPPA (Health Insurance Portability and Accountability Act) has heightened our awareness of the need to safeguard personal information. Ironically, there is immense value in stripping the patient identifier information and then selling the data to researchers for various purposes — from measuring the efficacy of a therapeutic to product development.

Bioethicists have long asked whether it is fair that an individual’s data is being sold and profited from without the individual receiving any compensation. Even more to the point, the patient has no control over where his information travels.

NFTs offer a solution.

By minting an individual’s medical record into an NFT, the patient can track his information and be in full control of where it goes. If there is an interested buyer, the individual is in the driver’s seat and should receive some compensation too.

While the application of NFTs in healthcare is not as far along as in real estate, companies are already coming to market with medical applications. A company called Cardano has developed a blockchain where information can be shared without revealing one’s whole identity.

They claim all the obvious NFT perks: authenticity, security, and timestamps.

Another company, Aimedis, has developed a blockchain-enabled healthcare platform. Their claim? They are said to have created the first NFTs for a cardiology patient’s ECG information.

My takeaway: The use of NFTs in medicine will accelerate as new applications are identified, and their adoption becomes more typical. Its adoption means that information will be more secure and controlled by the patient. They might even present an opportunity for personal monetization.

Example #3: Education

NFTs will be used as a record of academic achievement, where education tokens will be proof that the person holding the tokens earned the credential, thus reducing fraud.

This also means that as students transfer from one school to another, the student record will be fully accessible on the blockchain, meaning no wait time or missing data.

There are benefits in applying NFTs in education.

If you are a content creator — for example, an artist, writer, or musician— you will have the opportunity to sell your digital art globally.

This will be very empowering and help students monetize their work and develop business skills.

When you think about NFTs in the field of education, a useful image to have is one in which all diplomas, certifications, degrees, and exam results will be stored on the blockchain. Again, the benefits of NFTs will apply — authenticity, security, and accessibility.

Digital badge company Credly has already begun to leverage blockchain technology in education for this exact reason.

The Bottom Line

There will be more applications of NFTs in mainstream industries beyond gaming, and it will change business as we know it. While it is hard to predict the speed of change, and it may be gradual in certain industries, NFTs will be a growing part of our future.

From intellectual property to fashion and wearables to purchasing event tickets to managing the supply chain, to obviously gaming, NFTs will be a force that helps us to track, authenticate and control our valuables.

Because I believe this, I’ve taken it upon myself at the mature age of 64 to understand what NFTs are about and consider how they might shape our behaviors going forward. Remember 12 years ago when Venmo was the new kid on the block? That could be NFTs today. I believe we need to understand and prepare so that we are not left feeling like Luddites.

I hope your takeaway is that even as the cryptocurrency roller coaster continues, NFTs will continue to be a growing part of our lives. You won’t need to be a gamer to feel their impact. Being knowledgeable about the new-new things in our lives is part of the plan to stay relevant and engaged.