In October, Miami-based art collector Pablo Rodriguez-Fraile bought a 10-second video clip by a digital artist for $67,000, even though it was freely available to watch; he recently sold it for $6.6 million.
Blockchain technology publicly authenticated the clip as unique, and its sale highlights the booming appeal of non-fungible tokens (NFTs) during the Covid-19 pandemic, as collectors spend vast sums on purely digital assets.
Non-fungible applies to items that cannot be exchanged on a like-for-like basis, as each one is novel.
NFTs' popularity could be fueled by the hype surrounding cryptocurrencies and blockchain, along with virtual reality's potential to create online worlds.
However, as with any emerging niche market, NFTs could suffer major losses if the hype dissipates, while there could be lucrative opportunities for fraud because many participants use aliases.
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