Ten types of NFT you should know about

The first NFT was developed in 2014 by Anil Dash and Kevin MacCoy. However, this industry’s advancements began in 2017, after the Ethereum blockchain went live, offering smart contract support. 

Understanding NFTs

Non-fungible tokens are digital assets designed as digital certificates of ownership. The unique cryptographic blockchain-based assets contain some precious information.

Since they are non-fungible, you cannot exchange this NFT directly with another – each NFT is unique in size, shape, and value compared to another. However, like other crypto assets, NFTs are transferred from wallet to wallet with records kept on the blockchain. 

The NFT space developed very fast and now contains several categories. This guide looks at the ten types of NFTs everyone must know.

Collectibles

The first NFT category on our list is collectibles. Collectibles is the largest NFT category recording the most sales and most enormous numbers of collectors. It’s also the first-ever NFT category to launch. But what are collectible NFTs?

A Collectible NFT is a limited virtual asset mainly characterized by rarity, value, and uniqueness. Due to rarity, collectible NFTs are every collector’s delight. 

The very first collectible NFT collection ever launched is Curio cards, which officially launched in 2017. Following the success of Curio cards, several other NFT collections like Bored Ape Yacht Club (BAYC), Meebits, Cryptopuks, and Cat Colony launched. 

Today, BAYC is the most extensive collection of collectible NFTs, having attained global acceptance. However, Cryptopunks collections hubs some of the most expensive NFTs ever sold. 

NFT collectibles could also come in the form of memorabilia. Take, for instance, memorabilia from the sports industry. Some collectors love to own memorabilia from athletes. NFTs streamline the process of accessing such memorabilia and collecting them. 

Artwork

Artwork NFTs is a category of these digital assets that majorly focus on the monetization of digital pieces of art. NFT artwork is a merge of technology and creativity. This refers to creating digital pieces of art and monetizing them using NFTs.

Blockchain technology affords benefits like proof of ownership, authenticity, digital scarcity, and creating economic opportunity. 

The biggest and best example of NFT artwork is the JPG file ‘Everydays: The First 5000 Days.’ The art created by artist Beeples sold for a whopping $69 million. This NFT is one of the most expensive digital pieces of art ever sold.

In the past, high-profile digital artists like FEWOCIOUS, Micah Johnson, Pak, and Grimes have debuted some fo their collections. 

Recently, there’s been a rise in generative art — computer-generated art. Projects like Art Blocks, Braindrops, and Autoglyphs have proven generative NFTs.

Event tickets

Another NFT category is event tickets. Event tickets are passes used to enter a particular event hall. There are many flaws in the ticketing industry, including black market ticket sales. Such opens events to insecurities and fraud. 

Moreover, tracking event attendees’ data with analog ticketing is virtually impossible. The lack of traceability makes it nearly impossible for event organizers to know the actual attendants.

The NFT ecosystem brought a more digital way of issuing event tickets as digital assets. These NFT tickets give their holders access to attend virtual or live events. The event holders get more profound records of everyone attending by issuing NFT tickets, hence fostering security. 

Several event holders have already used NFTs as tickets in the past. For instance, Las Vegas’ Afterparty offered 1500 Utopians as their entry pass. Other events like Coachella and Way Out West have also used NFTs as tickets. Simply put, NFT ticketing helps in fraud prevention, offering economic opportunities and speeding up cost reduction. 

Music and media

Another type of these digital assets is music NFTs — these are NFTs mainly developed to foster solutions in the music industry. Controversies have been all over the music industry, with several noticeable problems in copyrights and royalties, etc. Many times artists have complained of copyright infringements and unfair royalty sharing.

The NFT space brought ready solutions for the industry. With the adoption of NFT in music, tracing royalties became easy. The automatic contracts immediately disperse the royalties to artists without further involvement of intermediaries. Furthermore, blockchain tech can help in dealing with copyright issues. 

Since 2021, there has been significant development concerning NFTs and the music industry. The biggest, of course, was the launch of the first NFT album in March 2021 by an EDM DJ, 3LAU. In merely 48 hours, the artist collected a whopping $11.3 million. Later, other artists, including Steve Aoki, Kings of Leon, The Weeknd, Jay Z, and Eminem, began showing interest in NFT.

Indeed, NFTs are a game changer in the music industry. They provide access to this industry, safeguarding ownership rights and giving artists easy access to their profits.

Gaming

Another class of non-fungible tokens available in the crypto landscape today is gaming NFTs. While gaming NFTs have only been gaining speedy popularity recently, they date back to February 2017, when Cryptobots went public.

Gaming NFTs are digital blockchain-based assets designed to help gamers enjoy the best gaming experience. These assets are primarily applicable in blockchain play to earn games. However, NFTs are also popular in gaming platforms with models different from P2E. 

So, these NFTs carry many use cases in the gaming industry. Among the use cases include; 

• In-game characters — In some games, players must at least purchase one in-game character as an NFT. 
• In-game collectibles — Gaming NFTs also come in the form of in-game collectibles. You collect such NFTs while playing the games. 
• In-game assets – In other games, weaponry, skin, equipment, and clothing are NFTs. Gamers must buy such assets to improve the gaming experience.

Today, the most popular NFT games include Axie Infinity, Gods Unchained, and Decentraland. Interestingly, many such projects have different mechanisms for releasing NFTs. In some, gamers must win matches or battles, while in others, gamers need to climb level to garner NFTs.

Virtual items

Another segment of NFT currently gaining popularity is virtual items. In the past few years, there have been many developments around NFTs representing virtual items. 

There is already the entrance of virtual fashion/clothing in the NFT space. Fashion brands like Addidas, Nike, Gucci, Lui Vuitton, and others have entered the NFT space. Most of these brands announced the creation of virtual clothes for the gaming industry. 

There is also virtual land. Still in its infancy, the metaverse paved the way for land investors to capitalize on owning virtual pieces of land. Some brands like Addidas and Nike have already bought land in the metaverse. Popular land platforms today include Decentraland and Sandbox.

Real-world assets

Real-world assets NFTs are another category of digital blockchain-based assets which mainly tokenize real-world assets. Already, there have been speculations around the possible NFT use cases in luxury items and real estate. Tracing luxury items like fine wine can be streamlined by leveraging these digital assets. 

In the real estate industry, people can invest by simply using NFTs. For instance, technology is growing to offer opportunities in tokenizing assets like lands and houses for the real estate industry. Furthermore, company stocks can also be tokenized and sold as NFTs. 

Being still in its infancy, the NFT world has yet to fully realize the potential of digital blockchain-based tokens in real life. However, many experts believe that the advancements already noticed in the NFT space are simply paving the way for merging reality and NFTs.

Identity 

Identity NFTs are a group of digital assets that help provide identification certificates to people holding them. NFTs being unique pieces of assets, are very scarce. It’s the scarcity that enables the use of digital identity systems.

NFTs can help in providing digital identity management systems as unique identifiers. Institutions could decide to mint licenses and different certifications, enabling verify individual records in the long term. In NFT-based identity systems, the records are immutably stored and can be private or public, depending on the preference of the identity owner.

Meme NFTs

Meme NFTs also is one of the major categories of those blockchain-based assets. These are NFTs that represent various memes in the social networking landscape.

Memes are essential to social media — they keep the social media landscape going. But, the circulation of memes on social networking sites makes it virtually impossible for anyone to claim ownership of those assets. 

Blockchain technology allows meme creators and fans to tokenize their memes and earn lucrative rewards. Several memes, including Bad Luck Brian, Overly Attached Girlfriend, Side-Eyeing Chloe Trollface NFT, Keyboard Cat NFT, Grumpy Cat NFT, Bad Luck Brian NFT, Scumbag Steve NFT, and Creepy Chan NFT have been sold as NFTs — those are meme NFTs. 

Domain names

Web3 domain naming systems also adopted NFT. Platforms like Namecoin, Peercoin, and Emercoin allow people to get domain names on the blockchain. 

Blockchain-based Domain names convert simple human-readable names like john.eth or even Twitter addresses into machine-readable codes, i.e., blockchain addresses.

However, since the birth of NFTs, blockchain DNS providers have chosen to use this new system of selling web3 domains. Now, on most platforms, you can buy domain names in the form of ERC-721 NFT assets. You can buy some web domains created by platforms like Ethereum name service, unstoppable domains, and others in NFT marketplaces using a web3 wallet.  

Final Word

This guide has looked into the various types of non-fungible tokens available today. The categories are mainly associated with the role of NFT in the markets. Music NFTs, for instance, mainly help bring solutions to the music industry. NFT is still a young industry. As such, we should expect more developments in the future, which could lead to an increase in the types of NFTs.