Cryptocurrency exchange platform Coinbase has announced plans to venture into Non-Fungible Tokens (NFTs). The exchange platform made the announcement on Tuesday. It will launch an NFT marketplace that will allow mint, accept and trade NFTs. The exchange said that the marketplace will be available before the end of the year and that users can sign up for a waitlist to gain early access to the feature.
Non-Fungible Tokens abbreviated as NFTs are a unique and non-interchangeable unit of data stored on a digital ledger (blockchain), according to Wikipedia. They can be used to represent easily-reproducible items such as photos, videos, audios, and other types of digital files as unique items (analogous to a certificate of authenticity), and use blockchain technology to establish a verified and public proof of ownership. Copies of the original file are not restricted to the owner of the NFT and can be copied and shared like any file. The lack of interchangeability (fungibility) distinguishes NFTs from blockchain cryptocurrencies, such as Bitcoin.
NFT sales have continued to spiral this year. The industry continues to boom and has surpassed a transactional value of $10 billion dollars. In the first half of this year, NFTs recorded a sales volume of $2.5 billion. NFTs became popular during the pandemic as many people turned to the internet to take advantage of the digital opportunities it provides to make money with NFTs being one of them. Individual NFT artworks are among the most popular and valuable non-fungible tokens created so far in terms of profitability. Clothing and fashion brands are also increasingly benefiting from the NFT trend by releasing a digitized limited edition of their outfits with a collection of iconic celebrity pieces or design signatures. Individuals also make money through tokenizing collectables, the most popular of which are sports cards. Other people have seized the opportunity provided by NFTs to make money by investing in the non-fungible tokens; they buy NFTs and sell them later at a profit.
Some notable NFTs that have been sold includes the World Wide Web source codes which sold for $5.4 million at Sotheby’s. Andy Murray’s Wimbledon NFT which represents the moment he won in 2013 also sold for $178,000. Jack Dorsey, the founder of Twitter and Square sold his first-ever tweet for $3 million. Mike Winkelman, known as Beeple, sold a digital artwork for $63 million.
According to Coinbase, its NFT marketplace which will be called Coinbase NFT will include social features so as to draw creators to the platform.
The NFT marketplace is a way for Coinbase to broaden its revenue. Venturing into the NFT marketplace will be bringing it into a highly competitive scene where competitors like OpenSea, which is the biggest NFT marketplace, exist.