How blockchain created Digital scarcity ?
2 min read
in real life Gold , titanium , Rhodium are expensive because they are scarce and not for being a rare disease cure , one of #Blockchain capabilities is creating digital scarcity by solving many problems including double spend
to explain this more We all know the Mona Lisa painting , did you know that by 2020 the Mona Lisa was priced $860 million counting inflation from 1962
in the same time we all see pictures taken by people phones of the Mona Lisa , does those phone pictures sell for 860$ million ? they don't because there are hundreds of thousands of them , they have no value
Sure , Mona Lisa is nice painting and all but its price reflect the scarcity and the originality of that painting
in Blockchain, This scarcity is given value even more by :
- How Blockchain Solves double spend problem
- The generally power input of Miners for securing the blockchain network
- How much people trust the asset
- Market Speculation
Case of NFT's :
NFT stands for non-fungible token A non-fungible token (NFT) is a unit of data stored on a digital ledger, called a blockchain, that certifies a digital asset to be unique and therefore not interchangeable. NFTs can be used to represent items such as photos, videos, audio, and other types of digital files.
Access to any copy of the original file, however, is not restricted to the buyer of the NFT. While copies of these digital items are available for anyone to obtain, NFTs are tracked on blockchains to provide the owner with a proof of ownership that is separate from copyright.
The NFT market value tripled in 2020, reaching more than $250 million. During the first quarter of 2021, NFT sales exceeded $2 billion
Given the huge success of blockchain based cryptocurrencies the likes of Bitcoin , Ethereum ..etc a new interesting use has emerged called NFT's , seemed a joke at first but recently gathering serious steam The idea of NFT's so we can stay in our same Mona lisa example , it is to certify original / rare / scarce digital items
These are some of the main drivers for value in blockchain assets them being #cryptocurrency or #NFT or any other #Blockchain asset