Utility NFTs are more than just digital collectibles, providing owners with privileges, rights, and rewards they might not otherwise be able to access.
The total trading volume of non-fungible tokens ( NFTs ) has grown from $200 million in 2020 to over $12 billion in the first quarter of 2022. But to get rid of volatility and come to a real sustainable value of NFT, it takes more than just a fad, a race for something new and FOMO (fear of missing out).
At the same time, Utility NFTs – NFTs ICP price prediction with real use cases – can still be the driving force that will transform NFTs from an investment opportunity into a new way of earning, gaming interaction, or even a way of influence.
What is Utility NFT?
Utility NFTs are NFTs that can have real use cases that go beyond just unique collectibles. These are NFTs that provide their owners with unique privileges, rights, or rewards that they would not be able to access without acquiring these digital assets.
Perhaps the easiest way to understand what a Utility NFT is is to give a simple example. Imagine you are holding an event in a hall with 1000 seats. To access the entrance to it (this is just our utility, privilege or right), you can issue 1000 paper tickets. Each paper ticket will be unique or non-interchangeable, meaning it will have its own number, row, and seat.
Similarly, instead of issuing 1,000 paper tickets, an event organizer can issue 1,000 Utility NFTs. Each of these 1,000 NFTs will certainly be non-fungible and unique, but just like tickets, each will grant its holder the same perk or utility: admission to the event.
How do Utility NFTs work?
From a technical standpoint, Utility NFTs work just like other NFTs. They are cryptographic code recorded on the blockchain that represents a unique digital asset.
The transparency of blockchain technology means that it is easy for NFT holders to prove that the NFT is stored in their wallet and not in someone else.
How can a standard NFT become a utility NFT?
There are many ways to make a regular NFT (or series of NFTs) useful. This is not about changing the technology itself, but about the use of NFT technology.
Of course, in addition to the SLP to PHP, the album was also released in regular formats on platforms such as Spotify and iTunes. A whole series of Utility NFTs was included in the album, consisting of different types of NFTs that provide different privileges:
Just a few days after releasing the When You See Yourself album as a series of NFT tokens, Kings of Leon has already raised $2 million in NFT sales.
Just by looking at the Kings of Leon example, it’s easy to imagine other types of Utility NFTs that could work just as well. If NFTs can provide front-row seats at rock concerts, why can’t they guarantee year-round football tickets, effectively replacing season tickets?
What is so special about Utility NFT?
Utility NFTs have already begun to make their presence felt in the world of business and popular culture. And collections of NFTs that originally started out as regular NFTs are increasingly turning into Utility NFTs.
For example, the well-known Bored Ape Yacht Club was first launched as nothing more than a series of NFT images. Since then, Bored Ape NFTs have become access to exclusive events such as parties , as well as offering rewards in the form of the ability to create new NFTs
What is Sandbox?
It’s a bit like Microsoft’s popular hit Minecraft, which features blocky characters and worlds reminiscent of retro game pixels brought to 3D, but The Sandbox will feature a persistent and shared online map.
However, most of these locations and games on the map are not created by the original developers of the game. Each LAND in the game is an NFT that can be purchased and used to create custom experiences.
Some of them will be run by brands or communities, while others may be created by ordinary people who want to carve out their personal space in this world of the metaverse.
We’ll likely see virtual events in the world of The Sandbox, including those confirmed by artists Snoop Dogg and Warner Music Group, as well as NFT launch parties and other live performances. It could become an exciting hub for the wider Web3 community.
What is the Metaverse?
The Metaverse refers to a future, more immersive version of the Internet that is intended to be used through avatars in shared 3D spaces.
However, the term “metaverse” and how it will actually form is still a bit vague.
For developers of the crypto industry, the metaverse implies a series of worlds based on blockchain technology that uses open, interoperable technology. In these types of environments, NFT assets such as avatars, virtual clothing, and other items can potentially be used across different worlds and games.
Gaming is a growing sector in the broader NFT market, and other games like Axie Infinity and Zed Run use NFT for gaming assets.
While Web3 proponents highlight the potential of an open, interoperable metaverse built on blockchain technology, it’s unclear if these ambitions are shared by tech giants entering the space, such as Meta, although the company did highlight NFTs in its presentation.
Instead, Meta and other large centralized players could focus on immersive virtual and augmented reality (VR/AR) with limited interoperability.
How does LAND work?
LAND is what The Sandbox calls virtual terrain parcels, their map is huge: there are 166,464 individual parcels in the world. Each of them is represented by Ethereum NFT and can be freely traded and resold on marketplaces (such as OpenSea).
There are different sizes of LAND, including estates that can accommodate much larger venues and events.
Once you have landed, you can build whatever you want on it: interactive games, virtual meeting spaces, and more.
The Sandbox has launched building tools that allow creators to design terrain and build in-game mechanics, and you’ll even have the option to monetize the experience you create.
You can also buy up a bunch of land and rent it out to other builders if you like.
Features of The Sandbox
We haven’t seen the full experience yet, but part of what draws some people to The Sandbox is the ability to own their own space in the shared gaming world.
You’ll be able to roam and visit other user-created spaces, hang out, and socialize – plus the fact that lots are user-owned means the game world can constantly change and transform.
For creators, this is an opportunity to create games and share them with other players. For LAND owners, this is also a potential chance to earn some money. And for NFT fans and the Web3 community, it provides a common space to immerse themselves in culture and connect with other people doing the same thing.
Who supported The Sandbox?
The Sandbox has spent the last couple of years slowly building up an ever-growing list of partners and it’s a veritable collection of franchises, brands, and celebrities.
We’ve already mentioned Snoop Dogg, Adidas, The Walking Dead, and game publisher Ubisoft. Here are a few other partners that work in this space: The Smurfs, Atari, Paris Hilton, Warner Music Group, World of Women, Deadmau5, Gucci, South China Morning Post (SCMP), game maker Square Enix, metal band Avenged Sevenfold, Care Bears and Hell’s Kitchen series.
It’s a rather strange mixture, but the vastness of the world and the user experience means there’s bound to be a lot of variety in the world. Collectors like Whale Shark and Pranksy have also taken up a significant portion of the map, with crypto brands like Gemini, Binance, Ledger, and Socios supporting The Sandbox as well.
The Future of Utility NFTs
Utility NFTs are in their early stages of development, but new and innovative use cases are emerging every day.
In the future, they could replace everything from health insurance cards to loyalty cards and memberships, And NFT holders could get access to healthcare, discounts, or entry to events.
With the advent of the metaverse, service NFTs may appear that provides the owner with benefits. Virtual shared world, such as entrance tickets to games or other exclusive virtual environments.
Utility NFTs can be used to prove and incentivize ownership, build community, And even protect the planet. Technology already exists But how we use it is only limited by our imagination.