The rise of NFT must be accompanied by further decentralization

The rise of non-fungible tokens (NFT) is remarkable, and the market seems to be gaining more and more mainstream traction every day.In order to correctly view how large this space actually is, conservative estimates indicate that the amount of funds currently entering this fast-growing industry total More than 500 million U.S. dollars.

Another way to measure the impact of NFTs on the global economy is to look at all kinds of artists, celebrities, musicians—almost anyone at the moment—using this technology. For example, Megadeth, the pioneer of thrash metal recently Be one of the newest adopters NFT, allowing supporters to purchase unique collections officially recognized by the band. This just shows how wide the scope of this technology has become almost overnight.

In addition, what makes NFTs so unique is that they cannot be exchanged for other tokens in a mutually interchangeable way. This is contrary to the way most legal assets work (that is, the U.S. dollar can be exchanged for various commodities) and the way most cryptocurrencies (such as Bitcoin) work (Bitcoin) And ether (Ethereum), Features.

Because of their unique capabilities, NFTs can serve as an excellent ownership medium, enabling individuals to seamlessly purchase everything from digital art to music and even real estate.

related: How NFT, DeFi and Web 3.0 are intertwined

NFT needs a more decentralized environment to thrive

As the market for non-fungible tokens continues to flourish, more and more people will continue to switch to highly decentralized blockchains to provide users with a high degree of data transparency and flexibility in terms of trading NFTs, which makes sense , Especially when compared to centralized solutions such as Rarible, OpenSea, Binance NFT.

Today there are blockchains based on Byzantine Fault Tolerance (BFT) clusters, which are tailored to handle NFT database management responsibilities. A decentralized database can provide users with simplified access to the data delivery network, ensuring a high level of protection against data leakage, network failures and performance issues-all of these issues currently plague the global NFT ecosystem to a large extent.

related: The role of decentralized networks in a data-rich, hyper-connected world

In terms of technology, it should be noted that although most NFTs today are built on the Ethereum network, the ecosystem is currently facing some serious congestion issues and issues related to high gas costs. Recently, it was reported that the average price for facilitating transactions on the Ethereum network (between the end of February and March) hovered between US$16 and US$20.

Finally, it should be noted that although most developers today continue to rely on centralized databases (such as those provided by Amazon Web Services and Microsoft), the fact remains that these databases have centralized points of failure and are therefore vulnerable to various third parties. Invasion and threats.

The future of NFT is bright

As more and more money-whether it’s retail or institutional- Enter the NFT market With each passing day, many experts believe that this field will soon transform into a multi-billion-dollar industry, and its use cases will go far beyond the scope of art and music ownership.

related: The art of reimagining: NFT is changing the collectibles market

In addition, there are reasons to believe that in the future, we may see NFTs being used for a wide range of daily payment/transaction purposes-such as buying clothes, shopping in supermarkets, etc.-because these tokens have inherent linking capabilities. The identities of people and the items they buy make refunds and product exchanges easier and easier.

In addition, as the COVID-19 pandemic continues to raging around the world, many governments have promoted the use of contactless technologies within their borders. This may be another reason why the adoption rate of NFTs will rise sharply in the coming months and years.

Finally, in order to portray the rapid rise of these digital products, we can see that many well-known NFT markets have recently witnessed record high transaction volumes.For example, OpenSea currency inflow/outflow Spikes It has increased by 1,400% since the beginning of the year, and Rarible’s total transaction volume has increased by 634% in the past few months.

This article does not contain investment advice or recommendations. Every investment and trading action involves risks, and readers should research on their own when making a decision.

The views, thoughts, and opinions expressed here are only those of the author, and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Pavel Baines Is the CEO of Bluzelle-the decentralized database of the New Internet. Pavel is a digital media expert and has worked with Disney, Microsoft, Warner Bros. and DreamWorks. Pavel also frequently writes for Forbes, Huffington Post and Fast Company, and writes articles in the financial and digital media fields. He was named a technology pioneer by the World Economic Forum.