Non-fungible tokens or NFTs are one of the most talked-about trends in the cryptocurrency market in recent times. NFTs have their existence completely digital over the blockchain platform. These digital assets can be anything like artwork, music, videos, and more. NFTs are one kind of item and allow their sellers to sell them at some reasonable cost to gain from their selling’s. On the other hand, crypto investing refers to owning a cryptocurrency asset or digital currency with the goal of either holding it for the long term or making a profit by trading it. So, if you are planning to trade Bitcoin, you may consider visiting a reliable trading platform like https://chain-reaction-trading.com/.
Although both NFTs and crypto investing involve using cryptocurrencies, they are different in many ways. To explore this topic, we asked around and reached out to experts in the field to shed some light on what the difference is. Here is where you can find more NFT art.
Ownership
One of the biggest differences between NFTs and crypto investing is in ownership. NFTs have unique ownership rights tied to them that cannot be replicated. According to Harrison Gross, the CEO of the crypto firm, Blockpass, “NFT ownership rights are unique. They are immutable and cannot be duplicated. This means that owning an NFT gives you complete ownership rights to that digital asset.”
On the other hand, with crypto investing, you’re buying and selling digital coins like Bitcoin or Ethereum, where ownership is not unique. Anyone can buy the same cryptocurrency that you own, and there’s no special claim to its ownership.
Purpose
The purpose of NFTs and crypto investing differ greatly. NFTs allow collectors and creators to own something unique, an item that is scarce and valuable. “NFTs are appealing to investors who are interested in unique, one-of-a-kind items,” says Arjun Balaji, Managing Partner at Paradigm, a cryptocurrency investment firm. NFTs allow you to own something that has the potential to appreciate, but it is more like owning a piece of art than investing in a cryptocurrency. On the other hand, Crypto investing is all about investing in a digital asset with the potential for a good return on investment (ROI). Investors enter the market with the expectation of selling those coins at a higher price than what they bought them at, in the hopes of making a profit.
Value
The value of NFTs and cryptocurrencies has a significant difference. The value of a particular NFT is not fixed but varies along with the market condition and present and future considerations. In contrast, the value of cryptocurrency can change dramatically up and down but is typically measured in fractions of a cent.
Use cases
The use cases for NFTs and cryptocurrencies are also vastly different. NFTs are used to represent unique digital assets, like artwork or collectibles, but can also represent more advanced assets like land or real estate. “NFTs are going to revolutionize the way ownership is tracked across just about every sector of the economy shortly,” says Aaron Tsai, CEO of MAS Capital, a fintech-focused venture firm.
Cryptocurrencies, on the other hand, can be used for a wide range of purposes, from online purchases to making international transactions. Cryptocurrencies can be used as a store of value, a speculative investment, or an alternative currency for daily transactions.
Conclusion
While NFTs and crypto investing involve digital assets, they differ significantly in ownership, purpose, value, and use cases. Understanding these differences is crucial for any investor or collector looking to involve themselves in either area. NFTs are fascinating because they are unique and offer collectors something special, while crypto investing is a more traditional form of investment. However, both offer the potential to make a profit if done correctly. Understanding the risks involved are prerequisite before investing in any crypto product.
