NFTs and their ecosystem insanely grow day by day. So, don’t miss out on the train and get in.
I assume that most of you will know exactly what an NFT is at this stage. If you don’t here is the quick TL;DR. An NFT is a non-fungible token a unique digital asset that is issued on a blockchain and holds the following characteristics.
It’s permanent, it cannot be replicated, it cannot be counterfeited, and the owner can prove that they do in fact own it.
There are a number of different NFT types out there. These range from digital art to music, domain names to sports events. I’ve covered NFTs on numerous occasions the first of which was over a year ago. So, I encourage you to read some of my earlier posts, if you want more information on the sector.
Now that being said one of those NFT sectors that I’m dying to dive into is the crypto collectible one. These are the ones that have been grabbing all the headlines recently, and baffling a good many people. These collectibles can be considered as being like baseball cards on a blockchain. Essentially, they are unique collectible images that have been minted mostly on the Ethereum blockchain as an NFT.
Each of these images are unique and they contain certain characteristics. Some of these characteristics are shared with other images, some of them are only shared with a limited few. The prevalence of these characteristics in the population of images in the collection determines the value. So, you can think of it as akin to those sports trading cards we had as kids. The rarer the qualities of the card the more valuable.
Some of the characters on the cards shared characteristics and features with the others. However, those that had the combination of the most rare elements were the most valuable and consequently came with the highest prices.
Anyways, when it comes to cryptocollectible NFTs there is much larger scope for developing these unique images. They use a randomized algorithm to incorporate certain elements in the creation of these NFTs. Statistically, some are more likely to have the most common elements, whereas only a few are likely to incorporate the rarer elements.
You can think of it as akin to a Pokemon character, or your favorite baseball or football star, and breaking them down into various unique components. These components could be strength, dexterity, stamina, defense, offense, etc. These qualities are then placed in a randomized mixer jumbled around and then pulled out of the mixer as a unique collectible. Rinse and repeat for all of those that you want to make up your collection. This can easily be done on the blockchain because randomized number generators are provably fair. So, are you guys still with me? If you are a little confused then don’t worry it’ll be a lot easier to understand when we take a look at some examples. So, let’s do that
NFT Collectibles
The first NFT collectibles issued on the Ethereum blockchain are also probably the most famous, and those are the
CryptoPunks.
These were a collection of 10,000 uniquely generated characters that took their inspiration from the London punk scene of the 1970s.
They were also the first known NFT collectibles issued on the Ethereum blockchain back in June of 2017. Every one of these punks has their own ostensible personality thanks to their unique combination of randomly generated features. This includes everything from facial features to hairstyle eye accessories to head accessories, skin color to facial hair.
It’s engineered rarity traits have been deliberately assigned so as to make certain pieces rare and thus precious and others more common. The prevalence of each of these traits in the punk population will determine the rareness of said punk and hence its relative value.
So, for example we can take a look at some of the largest sales of CryptoPunks on the Lava Labs website. Those punks that are the most valuable are aliens Apes and zombies that’s because there are only 9, 24 and 88 of these types respectively. It’s just that though.
CryptoPunk 7804 is an alien but is likely to be worth a hell of a lot more than another alien punk CryptoPunk 7523. That’s because there are far fewer collectibles out there in general that have the rare combination of a forward cap pipe and small shades. Read More…
Categories: CRYPTO 101 GUIDE, CRYPTO NEWS
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