Cardano’s creator shares his thoughts about the short history of non-fungible tokens (NFTs). Charles Hoskinson takes listeners through a list of possible use cases that NFTs could fulfil as the sector develops in a new Twitter space that he hosted on the 26th of December.
“NFTs are useful for anything that you have a collection of or is connected to something beyond a standardization. So, for example, a deed of land. Mineral rights. Water rights. Any notion of property rights. In the GameFi [gaming and decentralized finance] space, any notion of your character progressing throughout the game. Your activities within that game. The special powers that you accumulate, all the rewards that you accumulate – all these things can and should be tokenized at some level.
They also can represent experiences. They can represent achievements, like diplomas. Credentials. Obviously, if you went to medical school and graduated, that’s specific to you. It’s not fungible – it’s specific. NFTs, as a format, I think in each of those areas, is useful. So it’s actually a larger space than the fungible world. And you can securitize them. You can take anything that’s an NFT and turn it into something that’s associated with a revenue stream.”
As part of his discussion, Hoskinson discusses his own interest in the Twitter space and how Cardano will contribute to it.
“What I want to do is just get involved with the high-level, you know, metaverse, GameFi, and something related to collectibles and then watch how those things evolve. And then I’ll worry about things like governance, interoperability, and these types of things and sort of let the commercial people figure out different ways to make money.
A lot of what is at the end of the rainbow is going to be complex intellectual property negotiations. License deals. Like, we’ve had some discussions about how you represent a patent portfolio as an NFT. How you can sell the rights to the portfolio and then how that can turn into interest-earning future profits on that.
We can securitize patents as a non-diluted way of guaranteeing capital for a business. If you’re a pharmaceutical company, for example, you have to sell stock. You can pre-sale part of your patent portfolio on the anticipation of it generating money. There’s a lot of little stuff like that that can be done.”
The Cardano creator also sees NFTs playing a significant role in how brands and influencers connect with their audiences, possibly beginning with video sharing platform TikTok.
“Tokenization of brands is also becoming increasingly more transparent, especially in a world where influencers and TikTok people, I think, are going to be the first wave to tokenize their brands…
But, to be honest with you, I am surprised by the growth and scale of the NFT space. It’s gone from nothing to very substantial in a very short period of time.”