collectibles

5 ways to monetize your digital art with NFTs

Monetizing digital art with NFTs provides proof of ownership, increased value and potential for royalties.

Nonfungible tokens (NFTs) offer a new way to sell and distribute digital art, and they have the potential to unlock new revenue streams for artists in the digital age. Here are five ways to monetize your digital art with NFTs.

Fractionalized ownership

This involves splitting the ownership of an artwork into smaller parts and selling them as tokens, allowing multiple investors to own a stake in the artwork. For example, an artist can create 100 tokens for a piece of art and sell them to 100 different buyers, each of whom owns a share of the artwork.

Dynamic NFTs

Dynamic NFTs are a type of NFT that changes over time, creating a unique and evolving experience for the owner. Dynamic NFTs can use external data sources to update the artwork, such as social media feeds or actual occurrences.

For example, “The Eternal Pump” is a dynamic NFT that changes in response to the rise and fall of the cryptocurrency market. The artwork gets more complex and elaborate as the value of cryptocurrencies rises, while it gets more straightforward and abstract as their value falls. Because they allow viewers to follow changes to the artwork and see it develop over time, dynamic NFTs can bring a new degree of involvement and engagement to collectors.

Feeling incredibly fortunate to have been one of the lucky few to pick up one of @dmitricherniak's works, The Eternal Pump, on the @artblocks_io Artist Playground today. Another stunning body of work by a fantastic artist. pic.twitter.com/NRywp1kQaC

— pixelpete (@pixelpete) February 22, 2021

Dynamic NFTs can be monetized via auction, where collectors can bid on them, and the highest bidder takes ownership. Dynamic NFTs that are highly sought after, due to their unique features and evolving nature, can command high prices at auction. Additionally, using subscription-based systems, artists can offer collectors exclusive dynamic NFTs for a fee. These NFTs might vary frequently, offering subscribers a steady stream of fresh content.

Royalties

NFTs can be programmed to automatically pay the artist a percentage of the sale each time the NFT is resold on a secondary market. This allows artists to continue to profit from their work even after the initial sale. For example, the digital artist Pak sold an NFT called “The Fungible” for $502,000, and the NFT was automated to pay the artist a 10% royalty on every subsequent sale. Since then, the NFT has been resold multiple times, and the artist has earned over $2 million in royalties.

X/X: Cube

Fungible* Open Editions

The number of owned cubes will deliver a personalized set of NFTs totaling the same fungible cube count. pic.twitter.com/p5qO4NgHJp

— Pak (@muratpak) April 6, 2021

Gamification

This involves creating interactive nonfungible tokens that users can play with or use in games. For example, Axie Infinity is a game that uses NFTs as game assets, with players able to buy, sell and trade them to build their game characters.

In addition, NFTs can be given as rewards for achieving particular goals or activities in a game or app. For instance, a fitness app may offer nonfungible tokens to users who reach their daily workout targets.

Physical asset tie-ins

Physical asset tie-ins with NFTs involve linking a physical object to a unique digital asset, typically using a unique identifier or code. This can provide a way to verify the authenticity and ownership of the physical object, while also allowing for the transfer of ownership and value of the associated digital asset.

That said, an NFT can be used to represent ownership of a physical asset, such as a piece of real estate or a car. For instance, a company called CarForce is developing NFTs that reflect ownership of high-end automobiles, with the NFT serving as a digital car key that permits the owner to enter and operate the actual automobile.

Fanatic sells 60% stake in Candy Digital amid ‘imploding NFT market’

The sports merchandise giant has got cold feet in the shrinking NFT market.

Sports merchandise firm Fanatics is divesting its stake in nonfungible token (NFT) company Candy Digital as confidence in the asset class wanes.

On Jan. 4, it was reported that Michael Rubin’s sports company Fanatics was offloading its majority 60% stake in the NFT startup.

Fanatics was started in 2011 and has become a known name in sports merchandising and e-commerce, valued at $31 billion.

*MLB ICON Leadoff NFT Collectibles, launched by Candy Digital in Apr. 2022 Source: MLB*

However, the crypto bear market has hit the NFT sector hard in 2022, and Rubin’s firm is seemingly now looking to turn away from “standalone” NFT businesses.

The investor group led by Novogratz’s Galaxy Digital will be purchasing the stake in Candy Digital, according to CNBC. In an email shared with the outlet, Rubin wrote:

“Over the past year, it has become clear that NFTs are unlikely to be sustainable or profitable as a standalone business.”

He stated that divesting ownership in Candy Digital “allowed us to ensure investors were able to recoup most of their investment via cash or additional shares in Fanatics.”

This was a favorable outcome for investors “especially in an imploding NFT market that has seen precipitous drops in both transaction volumes and prices for standalone NFTs,” he added. NFTs alone would not create much value, according to Rubin, who said:

“We believe digital products will have more value and utility when connected to physical collectibles to create the best experience for collectors.”

Fanatics acquired Topps trading cards for roughly $500 million in Jan. 2022. Furthermore, it acquired the rights to produce Major League Baseball trading cards and then NFTs following the launch of Candy Digital last year.

Fanatics raised $700 million in fresh capital in Dec. 2022. The funding will be used on potential merger and acquisition opportunities across its collectibles, sports betting, and gaming businesses, according to CNBC.

Candy Digital secured $100 million in funding in Oct. 2021 with a valuation of $1.5 billion at the time.

However, the NFT markets have shrunk considerably during the 2022 crypto winter. According to the Nonfungible.com market tracker, daily sales volumes have slumped from over 100,000 sales in January 2022 to around 15,000 today.

Cointelegraph reached out for comment from Fanatics and Candy Digital but had not received a reply at the time of publication.

Fanatic sells 60% stake in Candy Digital amid ‘imploding NFT market’

The sports merchandise giant has got cold feet in the shrinking NFT market.

Sports merchandise firm Fanatics is divesting its stake in nonfungible token (NFT) company Candy Digital as confidence in the asset class wanes.

On Jan. 4, it was reported that Michael Rubin’s sports company Fanatics was offloading its majority 60% stake in the NFT startup.

Fanatics was founded in 2011 and has become a well-known name in sports merchandising and e-commerce, valued at $31 billion.

*MLB ICON Leadoff NFT Collectibles, launched by Candy Digital in April. Source: MLB*

However, the crypto bear market has hit the NFT sector hard in 2022, and Rubin’s firm is seemingly now looking to turn away from “standalone” NFT businesses.

The investor group led by Mike Novogratz’s Galaxy Digital will be purchasing the stake in Candy Digital, according to CNBC. In an email shared with the outlet, Rubin wrote:

“Over the past year, it has become clear that NFTs are unlikely to be sustainable or profitable as a standalone business.”

He stated that divesting ownership in Candy Digital “allowed us to ensure investors were able to recoup most of their investment via cash or additional shares in Fanatics.”

“We believe digital products will have more value and utility when connected to physical collectibles to create the best experience for collectors.”

Fanatics acquired Topps trading cards for roughly $500 million in January 2022. It also acquired the rights to produce Major League Baseball trading cards and then NFTs following Candy Digital’s launch last year.

Fanatics raised $700 million in fresh capital in December. The funding will be used on potential merger and acquisition opportunities across its collectibles, sports betting and gaming businesses, according to CNBC.

Candy Digital secured $100 million in funding in October 2021 at a valuation of $1.5 billion.

Cointelegraph reached out for comment from Fanatics and Candy Digital but had not received a reply at the time of publication.