NFTs are the new rave, everyone seems to be making money from them and there seems to be a new drop every other day on crypto Twitter. Celebrities have wholeheartedly jumped on the NFTs bandwagon and every project I know today has already incorporated NFTs into their plans or planning to do so in the nearest future. Such is the hype around NFTs that once you get into the community, you need to have a strong will power to control yourself over-buying. The honest truth however from all I've seen is that 90% of NFTs have no utility apart from being profile pictures. The little nameless NFT projects are nothing more than profile pictures for their buyers, and the big name projects can maybe be seen as a store of value as price is expected to increase overtime.
- Store of value:
This is the most popular use case for NFTs in my opinion. A large majority of those buying them see them as a store of value that is expected to increase overtime. Sadly it's mostly the big name NFT projects that fulfill this use case. A lot of the smaller name NFT projects that pump like crazy can be expected to dump over time. Some examples of projects I think fulfill this use case include; Crypto Punks, Fidenzas, Bored Ape Yacht Club, Mutant Ape Yacht Club and a bunch of really big name NFTs. These in my opinion are those that can classify as stores of value because there will always be more rich people who want to buy them as a flex most importantly. I could be wrong and as I have said repeatedly it's just my opinion.
- Royalties:
This is gradually growing to be a popular use case with NFTs. Artists can now use NFTs to give Royalties to their fans and loyal following who buy them. Holders of the NFTs are entitled to some of the Royalties from the music or artwork which they hold as NFTs. This is a pretty dope use case that I believe will encourage many to come into the NFTs space as who doesn't like a good side source of income and getting Royalties from music and artworks is most definitely as good as it gets. Projects like Band Royalty allows users to buy NFTs that gives them Royalties to artists' music and other forms of art.
- Revenue generating:
This is one very innovative NFT use case that I came across recently and it is one I believe that we will grow to see many projects adopt as a way to reward their community and believers. Imagine a project like Uniswap or OpenSea released their NFTs and holders of the NFTs get a percentage of all the revenue that these platforms get. These are both platforms that process billions of dollars in transactions daily, and a percentage of those transactions goes back to the project as their revenue. So what if a percentage of those revenue are given back to the community, kind of how stocks give dividends.
It is pretty innovative in my opinion and there already is a project with that model and their name is POLKAPARTY. Holders of their PartyApes NFTs are going to be rewarded with 20% of all the platform's revenue. Only 1,000 PartyApe NFTs were released and currently according to OpenSea there are just 134 owners. This is going to be a great source of passive income and it's one model I believe that many projects will emulate in the coming months.