Speedy CryptoArt: From the history of cryptocurrencies to the birth and future of NFT art (easily explained)
(1) The birth of cryptocurrency
A year into the global financial crisis, in October 2008, the first cryptocurrency was born when a person named Satoshi Nakamoto published a digital paper titled “A Peer-to-Peer Electronic Cash System.”
The background to this publication was a slump in “money” (currencies such as the dollar and yen). Cryptocurrencies were born from the punk spirit of trying to make “money” that is supported by everyone (called “decentralized”) instead of money that is issued by a country and supported by a central authority. National currencies are backed by their respective states. However, with the developments to digital society, physical money is growing weaker.
◆Answering your questions! Who makes the money in the cashless era?
That was the start of cryptocurrency. The digital number “1” will be worth ¥1 if everyone believes in it. That work of producing trust is called “mining.” This is similar to how, if society thinks a banana is worth ¥1, then two bananas are worth ¥2. If everyone in society promises to trust bananas, bananas become money. Cryptocurrencies are the digital interpretation of this idea. They are called “decentralized money” because they are based on everyone’s trust, not on the state.
There are various kinds of state money, including dollars, yen, or euros. Similarly, there are various kinds of cryptocurrencies. Bitcoin is the famous one. It went up in value when Elon Musk said Teslas could be bought with cryptocurrency. NFTs use the second most popular currency, Ethereum (ETH).
One ETH is worth about ¥320,000 (as of September 25, 2021). In May, it reached a record value of ¥440,000 despite being worth less than ¥100,000 at the beginning of the year. It is a volatile market.
If you would like to open a cryptocurrency account, I recommend the following.
– bitFlyer = SBI Investment, Mitsubishi UFJ Capital, Mitsui Sumitomo Insurance Venture Capital, Dentsu Digital Holdings
– Coincheck = Monex Group 100%
– GMO Coin = GMO Group
– DMM Bitcoin = DMM.com Group
– Unima = Mobile Factory subsidiary
– Binance, Hong Kong capital
(2) The birth of NFTs
NFTs were born in 2017, nine years after the arrival of the first cryptocurrency. Whether crazy or rich, cryptocurrency folks, like those working on AI, are a crazy bunch. They’re trying to change society with ideas outside the realm of ordinary common sense. This can be at both the extremes of creation and destruction. I want to share a feel for how they approach things with great energy while also managing to remain playful.
People who pay ¥7.5 billion for something like digital art are ultra-rich people involved in finance. To them, sums are just pocket change. No longer satisfied with “the speed at which money makes more money,” they play with cryptocurrencies instead of stocks or bonds. When the DJ Steve Aoki buys some scribbles made by a Japanese 8-year-old for ¥800,000, he’s doing it for the fun of it. It’s closer to choosing a Twitter icon than investing in an asset. If you think about it, Instagram pictures and LINE stamps are also just events in a virtual world. However, for those in Generation Z (those currently from 6-25 years of age), it is not uncommon for in-game items or cryptocurrency earned playing the NFT game to suddenly be worth hundreds of millions of yen. Even if they eat cheap convenience store lunches in the real world, in the virtual world (Metaverse) they want to dress up in Gucci sneakers in the virtual world. I want to share these perceived values with you.
What is the value of NFT art? How to answer this question in one minute
(3) Growth of the NFT Marketplace
NFTs allow one to certify that a work of digital art is unique. One can keep an unfalsifiable record of how the work is resold and changes hands. In some cases, resale can be set up so that royalties for secondary distribution go to the original copyright holder.
So how do you buy an NFT?
First, you need to create a cryptocurrency account. There are about 3 million accounts open in Japan (as of September 2020 there were 100 million accounts globally). Of these, only a small percent have likely purchased NFTs. Therefore, it is likely that very few people in Japan can purchase NFTs. It is important to lower the threshold for understanding. Setting up a wallet to buy NFTs is a hassle. To help make this easier, some companies have issued their own currencies (BITMAX), which work in a similar way to LINE wallets, make setting up wallets easier, and can be used for NFT transactions. However, such methods do not use Ethereum, they cannot be used internationally. As Twitter will soon support wallet authentication, things should become easier in the future.
NFTs only became known to the general public on March 11, 2021, so, at the time of this writing, not even half a year has passed.
Major marketplaces for buying and selling NFTs
OpenSea is the leader by a huge margin!
Monthly trading volume for September 2021
– NFT market as a whole: 197 billion yen
– OpenSea: ¥193 billion
– SuperRare ¥1.3 billion
– Foundation ¥1.2 billion
– Nifty ¥1 billion
(4) Introducing 13 representative works of NFT art (updated September 27, 2021)
(5) Overview of the Speedy CryptoArt service