NFT Utility: 10 Outstanding Utility NFT Projects
Non-fungible tokens, or simply NFTs, have been in the limelight for some time now. They are taking the world by storm and revolutionizing how virtual ownership is being perceived worldwide. While many people associate non-fungible tokens with the booming digital art and collectibles market, their utility goes far beyond simply representing a digital asset.
In fact, non-fungible tokens are increasingly being used as a way to create new markets for digital goods, verify identity in a decentralized way, and even secure the ownership of real-world assets. In this article, we’ll explore the world of NFT utility and closely examine some of the most exciting use cases for this groundbreaking technology.
What’s NFT utility?
NFT utility refers to the practical use or purpose of a non-fungible token (NFT). Usually, when talking about utility NFTs, most think about digital art or collectibles. However, it is not limited to this alone; it can also serve various practical purposes. In fact, utility refers to advantages or rewards granted to the non-fungible token owner.
One example of NFT utility is in the gaming industry, where non-fungible tokens are used to represent in-game assets, such as weapons or characters, that players can own and trade. These NFTs with utility have the potential to create a new market for gaming items, as players can buy and sell NFTs to acquire rare or desirable assets.
Another example of NFT utility is the music sector, where non-fungible tokens can be used to represent ownership or access to a particular piece of music, such as an album or concert ticket. This can help musicians monetize their work in new ways, as fans can purchase non-fungible tokens that represent a stake in their music.
NFTs can also be useful in other areas, such as real estate, virtual worlds, and identity verification. As the use of NFTs continues to grow, new use cases and applications for NFT utility will likely emerge.
How does it work?
The utility of an NFT is nothing but its ability to represent ownership or access to a unique digital asset. Non-fungible tokens are created on a blockchain network, which provides a decentralized and secure way to verify the ownership and authenticity of the digital asset.
To create an NFT, an artist or creator will typically mint the digital asset as an NFT using a platform or marketplace that supports NFT creation. Usually, the minting process will have 3 steps:
- New block creation
- Data validation
- Addition of validated data on the blockchain
The NFT is then assigned a unique identifier recorded on the blockchain network. This identifier is used to verify ownership and track the ownership history of the NFT as it is bought, sold, and traded.
Once the non-fungible token is created, it can be bought and sold on NFT marketplaces or through private transactions. The NFT represents ownership of the underlying digital asset, which can be anything from an image or video to a piece of music or a virtual world asset. The owner of the NFT has exclusive rights to that asset and can transfer ownership or sell the NFT to another party.
The utility of an NFT can vary depending on the specific use case. For example, an NFT may represent ownership of a rare or valuable in-game item in gaming. Or, it may represent ownership of a particular song or album or access to a virtual concert in the music industry. In each case, the NFT provides a way to verify ownership and transfer that ownership in a decentralized and secure manner.
Use Cases of Utility NFTs
There is a wide range of use cases for utility NFTs, where the practical use of the token goes beyond simply representing a digital asset. Here are some examples:
As discussed above, non-fungible tokens can be used to represent in-game assets, such as weapons, avatars, or apparel. Players can purchase and sell these non-fungible tokens to acquire rare or desirable in-game items. NFT with utility assist the users to own the previously mentioned assets and retaining them even after quitting the game.
Usually, these purchased assets can be stored on the blockchain, and they can also be traded on the marketplace or exchanged for other assets or money. For instance, utility non-fungible tokens boost the economy of the metaverse sector.
Non-fungible tokens can be used to represent ownership or access to a particular piece of music, such as an album or concert ticket. Musicians can use these assets to monetize their work in innovative ways, which can help them boost their revenue. One can see numerous artists who release exclusive NFT music and also offer numerous perks to those users who purchase them.
NFTs can be used to represent a unique identity or personal information. This can help to verify identity in a decentralized and secure way without depending on a centralized authority.
The use of NFTs extends to virtual worlds, where they serve as digital representations of virtual assets such as virtual collectibles or real estate. In this context, players can participate in buying and selling non-fungible tokens with the aim of acquiring unique and uncommon virtual assets. One can say that the emergence of NFTs in the virtual world has consequently created a new market for digital goods.
The smart contract technology employed here helps the transaction remain transparent and fraud-proof. Furthermore, the non-fungible tokens purchased can help the buyer get passive rewards through renting.
For example, initiatives like Decentraland and Sandbox offer these kinds of utility non-fungible tokens. Moreover, it has been popularized to the extent that people are ready to invest millions of dollars in it.
NFTs have the capability to function as proof of ownership or access to sports memorabilia, including game-worn jerseys or championship rings. By purchasing NFTs, enthusiasts can gain a stake in their preferred sports teams or players, opening up novel means of connecting with and expressing their support for their favorite sports teams.
NFTs have the potential to signify ownership or grant access to specific events, like concerts or sports games. NFTs serve as a secure and decentralized method for verifying ownership and transferring access, reducing instances of fraud and scalping.
Overall, the use cases for utility NFTs are diverse and expanding rapidly. As more industries and applications embrace NFTs, new use cases will likely emerge, and the market for utility NFTs will continue to grow.
Best Popular NFT Utility Projects for 2023
Here are some popular NFT utility projects across various industries:
Decentraland is a popular platform that uses non-fungible tokens to represent virtual real estate and other assets within the virtual world. Players can buy and sell virtual plots on this site and build or carry out various tasks here.
CryptoKitties is a blockchain-based game that uses NFTs to represent unique digital cats. Players can buy, sell, and breed their CryptoKitties, with rare and desirable traits increasing the value of the NFTs.
SuperRare is a curated marketplace for buying and selling digital art as NFTs, where NFT creators can sell their virtual art as unique non-fungible tokens to collectors. Whoever buys these non-fungible tokens will be able to have exclusive ownership rights to the art.
This is a P2E ecosystem that depicts real-world horserace with the help of non-fungible tokens. The horses present in this ecosystem represent real-world thoroughbred racing horse yearlings. Players in this game earn Silks metaverse when their own Silks horses win a horserace in the physical world.
This is the latest entrant to the NFT utility project list that is launched to help neutralize global warming. By converting carbon credits – licenses that permit firms to discharge CO2 into the atmosphere – into non-fungible tokens that are completely tradable, it aims to achieve this goal.
Carbon credit NFTs can be bought and sold by investors, held for extended periods, or even “retired” by permanently removing them from the blockchain in exchange for a different NFT.
NBA Top Shot
NBA Top Shot is a digital collectible platform that uses NFTs to represent moments from NBA games. Fans can purchase non-fungible tokens that represent ownership of a particular moment, such as a dunk or a three-pointer.
Cocky: This is a project that focuses on providing access to real-world music events. Cocky aims to redefine the meaning of utility by establishing an elite lifestyle events club accessible to all NFT holders. They plan to organize exclusive electronic music events in premium locations, offering their NFT holders an unforgettable, immersive experience. The company plans to conduct a minimum of two in-person events each year while hosting virtual events regularly in the interim.
Overall, NFTs or non-fungible tokens are a new way of representing ownership and access to digital assets. Furthermore, the utility of NFTs is growing across various industries, such as gaming, sports, real estate, and art, and so on. Each of these avenues offer new opportunities for creators, collectors, and investors.
As the market for utility NFTs continues to grow and evolve, it is clear that NFTs are here to stay and will play a significant role in the future of digital ownership and commerce. With their unique benefits of decentralization and security, non-fungible tokens are poised to revolutionize the way we think about digital assets and ownership.
Whether you wish to learn about NFT, Blockchain, Web3.0, Metaverse, or other emerging technologies, we have the vital resources that will enlighten and help you make an informed decision.
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