Leo Elduayén Co-Founder and CEO of Koibanx gave a series of statements in which he showed his opinion and position regarding NFTs and the Metaverse, the usefulness and benefit that users can get from them, their great boom today, among other aspects.
The statements were given during a round of five questions that were made to the CEO of Koibanx which are mentioned below:
Cointelegraph English (CE): Are NFTs and Metaverses a Fad or Really Useful?
Leo Elduayén (LE): Before fully issuing the answer to this question, Leo Elduayén mentioned that there are two types of NFTs, the first “NFTs that represent value by virtue of being collectible (eg works of art)” and the second “NFTs that have a specific utility or even associated income.”
The first types of NFTs, collectibles tend to have a greater reach of recognition thanks to the hard work that is done at the marketing level. “Most of them are based on creating a community of which you are a participant only if you own one of these NFTs.” said Elduayén.
But a characteristic point of them is that each piece is created with a tangible added value that exceeds its scarcity and aesthetics. In other words, its value is based on the appreciation given to the piece by the person who wants to buy it.
On the other hand, the NFTs that have an associated utility, “they do generate added value”. To better understand his explanation, Leo used the example of a property deed saying that “Imagine that you want it to be digitized, that it begins to be part of the blockchain (secure, unalterable, transparent, etc.) and that it is also easy to transact, all of this is provided by the unique and unrepeatable NFT tokens (digital assets) that are registered in the blockchain and that can be transferred without the need for an intermediary.”
Despite their differences, there is a key meeting point for both types of NFT, this is the well-known Metaverse, specifically in a museum within it. This is due to the fact that when exposing the digital pieces as works of art, it is passed to “charge admission to the avatars who enter to see it and distribute the income among its authors. In this scenario, NFTs are being part of a virtual attraction that generates value for digital users (entertainment) and has an associated profitability or utility.”
CE: Virtual environments have been around for many years, especially in gaming. Why do many companies now talk about metaverses as something recent?
YOU: This is due to the presence of NFTs in the different existing virtual worlds, an element that was not present before, therefore, now they make the stay longer, for example in the gaming environment. more than anything in games “play to earn” in which gamers obtain benefits and rewards (tokens) that are created by the same game companies.
Then “Thanks to NFTs, those who participate in this type of virtual games/environments are really owners of their characters, clothing, materials, etc. Why are they really owners? Because NFTs, being on the blockchain, are transactionable and unique”, Elduayén explained.
Not to mention that the different values that a user can generate while living the virtual reality experience also become real-world earnings through the same NFTs and cryptocurrencies.
CE: Is there an NFT bubble?
YOU: “Thinking of NFTs as works of art and the concept of building community to create supposed value, I personally think so, yes, it is at least inflated.” However, he clarified that “the concept of a bubble must be taken with care” because the value of any digital asset is determined by supply and demand, therefore, it should be clarified if we speak of the “high value of NFTs or the high number of projects that do not really generate value”.
CE: What are NFTs for?
YOU: “Non Fungible Tokens (NFTs) are digitized assets that are within a blockchain protocol and have the characteristic of being unique. The term fungible refers to all those assets that having a pair, it is indistinct to have one or the other; therefore, NFTs are those that are irreplaceable.” To exemplify his explanation, Leo mentioned that they can be: a work of art, a security, among others.
To finish his answer, Elduayén said that “As we explained previously, this standard of tokens (digital assets in the Blockchain) can be applied in processes or products that add a lot of value (eg: a real estate deed; an electronic credit invoice pending collection; shares of a company with special rights; a work of art).
CE: The traditional media tends to talk about NFTs only from a speculative point of view. Why do you think that is? What is your view on it?
YOU: To close the round of questions, Leo Elduayén mentioned that heTraditional media rely on speculation to talk about NFTs since, they are based on the figures that this type of projects may be generating and he also mentioned that possibly the NFT “they are complex to understand for the “traditional world””.
To further understand, Leo compared the NFT as a digital representative format of the collection rights of an invoice and an NFT as a digital work of art.
About the first he said that “the real world will want to talk about “a digital invoice” and the collection value of that invoice is something already learned and understandable for the “traditional world”.
Nevertheless, “When we talk about an NFT representing a digital work of art that is worth more than a physical work, a new concept appears that “breaks” conventional standards and that not only draws attention but in many cases even “bothers” the “traditional world”, that is why they talk mostly about this type of NFTs”.
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