The collectible asset class is a fascinating one. It’s been around for decades, but it was in 2016 that the concept really took off.
At its core, an avatar is simply a digital representation of yourself that can be used within virtual worlds like Second Life or World of Warcraft. But when you combine this with blockchain technology and the ability to create unique collectibles, things get very interesting.
For example, if your avatar were to be sold for real-world money on a cryptocurrency exchange, it would be extremely difficult for them to be tracked back to you. If it were a collectible asset, however, you could potentially prove ownership of it using something called a non-fungible token (NFT).
In fact, it has become so popular that there are now thousands of avatars for sale on various platforms like the Ethereum-based marketplace OpenSea. In this article you can get to know more details here , how a couple of Reddit users blew up the NFT market place by creating their own collectible assets.
What Are Non-Fungible Tokens?
According to The Merriam Webster Dictionary, an NFT is a “digital object that cannot be copied exactly, such as a piece of software code, artwork, or physical item like a bottle of wine, because each instance of the item is different.”
As the name implies, they are not fungible. That means that unlike traditional cryptocurrency tokens, which are interchangeable, NFTs are unique. They can only ever exist once and have no value beyond what people are willing to pay for them.
This makes them ideal for the collectible asset space. For example, let’s say you’re designing a new game, and it needs some avatars. You might decide to use NFTs, so players can buy a specific type of character, or a set of characters, with a limited number available.
There will never be two copies of these characters, so even if someone bought one, they couldn’t sell it to another person without breaking the rules of the system. This also ensures ownership of the product is clear, and prevents fraud.
By using NFTs, you can make sure that the items being created are unique because they will always be one-of-a-kind. And since the avatars are owned by you, and not by anyone else, you can track every purchase made and see where they end up being spent.
However, NFTs aren’t just useful for games. They can be used for other purposes, too. A few years ago, there was talk about using them to raise funding for charity. You could give 10% of your wallet balance to a particular cause, and then a portion of your funds will be donated to them whenever you spend it.
It might sound complicated, but it works really well. So much so that a few companies now offer NFT crowdfunding services.
NFTs come with a whole host of benefits, including improved security over traditional cryptocurrency transactions, and the potential to revolutionize the way products are sold. However, the downside is that they haven’t quite caught on yet, and there are still a lot of questions about who should and shouldn’t be allowed to create NFTs.
CryptoKitties: The First CryptoAvatar
The first major success story for NFTs came from CryptoKitties, a crypto-collectable platform built on the Ethereum blockchain. The premise behind CryptoKitties was simple — create an avatar, breed it with other creatures, and try to win them all in a battle to the death.
The goal was to recreate the experience of owning rare animals in the real world. People wanted to buy and sell these collectables, and this was the perfect opportunity for an NFT to step in. The result was an explosion in demand for avatars that were worth more than $1 million, and the platform became one of the most popular sites in the world in 2017.
But the popularity of CryptoKitties didn’t last forever. Its creator eventually decided to shut down his website due to mounting legal pressure, and the platform has struggled ever since. As a result, many of the collectibles he created remain out of reach for average consumers.
Although CryptoKitties wasn’t an official project, the company behind it did release several NFTs into the wild. These included a cat named ‘Sushi Kitty’ and a teddy bear named ‘Bunny Buggie’. Both of these items were only available for a short time before being removed from the site.
If you want to find out more about CryptoKitties, there’s a documentary film called CryptoKitties: Secret of the Missing Kitties coming out soon. The movie looks at the creation of the platform and the controversy surrounding it, and while it isn’t likely to change your mind about the project, it does provide further insight into why it failed.
While CryptoKitties was the first crypto-avatar, it wasn’t the last. Another notable success story was Redditor u/matt_the_coder, who launched LuxeMall, a platform designed to help developers build NFTs in a secure environment.
LuxeMall allows members to upload their own creations and sell them to others, with buyers able to pay with Ether or Bitcoin. There are currently more than 600 avatars on LuxeMall, mostly based on video game characters, but you can also find some more unusual options, such as a stuffed koala.
As well as selling directly through the platform, you can also earn NFTs by completing tasks or participating in surveys. Some items are available to everyone, while others are reserved for VIP customers, and some of the highest-value ones are only accessible to accredited investors.
So far, it seems like LuxeMall is doing pretty well, with its collection growing rapidly. One of the reasons for this is the quality of the avatars on the platform. Many of them feature incredibly detailed renders, and the creators clearly put a lot of work into making them as realistic as possible.
One of the most famous avatars on LuxeMall is the ‘Rasputin’ doll, created by u/dakimbo_bob on Reddit. This is a fully articulated life-size replica of a Russian icon, and it’s now valued at almost $3,000. Another Reddit user, u/DankMemePants, has made several avatars available on the platform, including a Pikachu that costs $2,400.
These kinds of prices suggest that there is definitely going to be a market for collectible avatars in the future. The question, though, is whether it will be open to everyone or restricted to a small group of rich individuals.