 What the f**k are NFTs? Beeple's the first 5,000 days sold for a record $69,346,250 on March 11th, 2021. Holy f**k. Hey, what's up, Jay here, and welcome to Bitcoin Daily bringing you guys the best tips, tutorials, and ideas to help you guys become profitable and successful traders. The goal of this channel is to empower you guys with the knowledge and resources to help you get to that next level. So if you guys are new here, make sure to subscribe, hit that like button, and turn on the notification bell as we continue to spread mass knowledge and cryptocurrencies adoption. Alrighty guys, so in today's video, we are talking NFTs. And to do that, I am bringing someone who is very, very familiar in this space. V has an XR solutions company that specializes in creating digital assets for VR and AR applications. Currently, her company, Vivid Reality Solutions is focused on bridging the gap between XR and crypto. So let's jump right in with V. Alrighty guys, so what's going on? I'm here with V from Vivid Reality. V, how are you doing today? I'm doing great. How are you doing? I am doing amazing. I'm super excited to speak about NFTs as everyone knows it's been blowing up. My DMs have been blowing up with people just asking me about everything NFT, you know what I mean? And I haven't really had an answer for most things since I haven't myself dove into that space yet. So that's why today I decided to bring you on an expert in this space to tell the people to answer all their questions basically. So I'm going to ask you the questions that they've been asking me, but before we jump into that, give us a little bit about yourself and what you do. Okay, cool. So my name is V. I co-founded a company called Vivid Reality. We are an XR solutions company, so that means that we create assets and design solutions for anything that has to do with extended reality. So VR, AR, mixed reality. And what's really cool about that is that VR utilizes a lot of 3D objects and 3D environments and all these things can be turned into NFTs. So really what started out as being a specialist in creating digital assets has evolved into creating what I like to call purposeful NFTs. And we can dive into that or useful, right? More useful NFTs and we can dive into that a little bit later. That all sounds insane just thinking about some of the stuff you just said, but I don't want to, I don't want to jump in so fast. So first thing, so the first thing I'm going to start off with the first question I have, and I know most people watching right now with the first thing they want to know is what the hell are NFTs? Cool. Yeah, so let's just start with the basic acronym. NFT stands for non-fungible token and fungibility makes something interchangeable. So this is non-fungible. What does that mean? If I have $10 and you have $10 and we swap $10, I don't care because I can still go to the store and buy $10 worth of things. If I have a $10 bill and you have two $5 bills or 10 singles, right, they're still interchangeable. I can still take your 10 singles and give you my $10 bill and go to the store and buy $10 worth of items. That is not how NFTs work. The way I like to look at NFTs is in terms of contract and certificate and Ethereum is the currency or the fuel that fuels the transaction. So don't look at NFT as a currency in terms of like, I have five NFTs, I have five Ethereum. That's not how it works. The NFT represents a digital asset that is encrypted into the Ethereum blockchain. What happens in a world full of digital assets, right? It becomes very hard to prove what the original asset was. So for example, if I'm a photographer, right, and I upload my photography on my website, unless I watermark it and absolutely destroy the image for the buyer, nothing is really stopping someone in another state or another country to just save that file and sell it in their market. They can literally go and print 100 copies and sell it in their little store in Arizona and I will never know about it. So what NFTs are almost a solution for this lack of scarcity in the digital world. It's so easy to copy and paste things in the digital world. So what it does is it takes the digital file. So an NFT will always represent a digital file. So it does that. And then the second part is it embeds the digital file with a smart contract. And so you want to look at an NFT as a certificate and a contract. So the certificate says you can look on the on the blockchain and see that the NFT was uploaded by this person originally. And every time it gets sold after that, you can see, you can verify every transaction, everyone that has held it in between the original upload and the current holder. That all can be verified on the blockchain. So now we have a proof of authenticity, a proof of originality. That's the first thing. The next thing is that it embeds the NFTs embedded with a smart contract, meaning if this, then this, or when this, then this. So if I want to sell you a Picasso, there can be some middlemen in between, a couple of third parties, maybe a lawyer, maybe, you know, you have to get something shipped to you that can take a couple of days, a couple of delays, maybe I got to pay the carrier, things like that. So what the NFT does is it automates that entire process. As soon as I send you a certain amount of Ethereum, you automatically transfer ownership to me. I hold the piece in my wallet. There's no third party. There is no delay. There's no wait time. It's just, it's an immediate thing. So you want to, yeah, so you want to look at NFT as a certification of authenticity, therefore making something scarce or legitimizing its scarcity, right, publicly. And you want to look at it as, as a contract, an automated contract or a smart contract. Yeah. So that's, that's why it's built on the Ethereum blockchain. So that to take advantage of the smart contract. So that, like you said, if this, then this, right? Okay. That definitely makes a lot of sense. So that pretty much covers, you know, exactly what the NFTs are and how basically it works. Right. So I actually just got a notification on my phone that says Beeple. You know what Beeple is? Yes, I do. So Beeple NFT auction closes at record setting 69.3 million dollars. Correct. What in the hell just happened? Like, so, so I guess because of this, and this is literally live right now, just as I'm looking at, so I guess, like my next question is how and why do NFTs hold the value? So that's, that's a great question. And I'm actually really glad you got that notification because it's a perfect example of how, of how prominent NFTs are becoming and how they're kind of seeping into the physical world. So I believe it was sold at Christie's, right? Yeah. So Christie's is a very, very well-known art seller, right? They're an auction house, art gallery auction house. And, you know, they've sold things from Andy Warhol's to Picasso's and Monet's and things like that. So Beeple is actually an artist that I have been following for years and he's really awesome because he makes these very provocative political statements with his art. He does, he does a lot of things with, with Trump and Kim Jong-il and Hillary Clinton and just very like this provocative, these provocative statements on, on politics. And Beeple is actually probably the poster child of NFTs right now. He's, he's made an insane amount of money over the last month since. Selling NFTs and so to the point where now Christie's, which is one of the most renowned galleries in the world, has sold one of his pieces and for a staggering 69.3 million. That's insane. 69 million in, and yeah, like you said at Christie's. Yes, absolutely. And so, I mean, with regards to this stuff, if you want to look at right now, the use case of NFTs is art. And so when we're looking at investing, you have to look at it the same way as people were investing in art, right? Like there's some, there's some artists that they're just, they're just well-known like a Picasso, Picasso, Warhol will always be a Warhol and a Monet will always be a Monet. And they just, they just hold that value in the market. When it comes to these new age artists, there's a couple of rock stars like Beeple right now. And there's a couple of notable musicians and artists that have been, have been making NFTs and selling because of their name in the music industry. But really when it comes to investing in art and NFTs as digital art and NFTs as digital art, it's, it's your own assessment. What do I think this is worth? Do I think this will appreciate over time or not? Yeah, that's, that's insane. I pulled up here the tweet from Christie's about this. This is just crazy to me, you know what I mean? But do you think NFTs are a good investment overall? That's a great question. It's like I said, with the current use case, it's, it's about you and how you assess certain art pieces where you want to invest your money, right? So for example, there's a really famous NFT, if you want to look it up. It's called CryptoPunks. I don't know if you've heard of it. It's literally a pixel art of different heads, different heads. And they're just like, you know, some of these literally go for 30K for one. Same. Yeah. Some of them go for 30K. Some of them go for the prices vary, you know. So it's really about, it's very similar to the art market, right? Like it's like, it's inflated, it's a risk taker's game. However, it has a lot of beautiful attributes and a lot of beautiful ways that it can change the market forever. And I'd like to talk about that as far as investment goes because there is something that it does for the artists, for content creators that we don't get in the art world in physical reality at the moment. What that is is the opening up of secondary and tertiary markets and so forth. And so in that case, yes, it is a good investment because it is a market that I feel is one that we ought to support, right, as an evolving society. So because NFTs are on the blockchain, they can be verified every time a transaction is done. And so one of the things that you can do when you mint your first NFT or your second when you mint your NFTs is you can embed the NFT with a percentage for royalties, right? Well, every time so I can, I can post, okay, I want to sell this piece of art for one, for one ETH and I want to put a 10% royalty fee, right? Now, every time it gets sold and resold, even if I forgot about it 10 years later, I get money automatically transferred to my Taiwan. I had that I had no idea about. So as an artist, you sell your NFTs and then you implement into it when you're minting it or royalty. So every time they resell it, you get a percentage of whatever they resold it for. Absolutely. Without a middleman, without any literally making money in 20 years from now off of something that you sold 20 years earlier. And that's something that artists weren't able to do before. You weren't able to have a relationship with your art. Once you kind of sold a piece, that's it, it was done. So they don't know what happens to it. And so here you're able to track, able to see who holds it now. Like maybe Bill Gates will hold one of my pieces in five years from now. And I'm like, oh my God, it ended up in this space. And I get money off of it. You know, so it's this continued relationship between the artist and the art and the people that are purchasing it that I think is a really dope phenomenon that we're seeing. That's amazing. See, I had no idea about that part. So you get royalties on it. That's pretty crazy. Wow. It is. And another thing to think about within that realm is what it can do for the music industry. So at any given moment, there's about $250 billion of uncollected royalties in the music industry. Right. Because either they don't know who to pay out, they don't want to pay them out. You know, like there's no one to really, it's very hard to monitor every single time a song is played. And, you know, there's all kinds of politics and things like that involved. So as an artist, as a musician, if I'm uploading my own music into the market and I'm embedding it with, you know, a 5% or 2% or 1% royalty, whatever I want. It's like every time that song gets played, it's verified. It's automatically embedded in the smart contract that I'm going to get money out of that. Right. So that's insane. So now that you speak about music, I know that Kings of Leon just, for their album, used NFTs. So how exactly, like what is it that they used the NFTs for, for this album? Like I didn't really understand that part. I read a little bit about this last week. And what I understood was, well, first of all, you know, a lot of artists now are very interested in getting into the space. And so they're using NFTs to promote themselves and their, their music. And also just be ahead of the game. Right. You know. So what I understood though is that they're incentivizing people to, to purchase these artworks by saying, okay, the highest bidder will get what's called a golden ticket. And that's, I believe it was like four front row seats to every Kings of Leon concert in life for eternity. Wow. Okay. That's crazy. Right. And they get like a bunch of free merch for every show and a private driver and things like that. So this incentivizes people to like bid very high. It's really exciting. Like first you get it, you get an NFT, you get some artwork. And second of all, you get all this, all this free merch, all these exciting, all these exciting incentives to, to engage with the artists more, right? That's insane. Just seeing where this space is currently at and where it's been, like where it can potentially go. Like it's crazy as we see it grow. We're literally watching this space grow in the matter of like, because it's been around for, for a while already, right? But it's just now that it's starting to pick up steam in the mainstream. Yes. And I'm glad you brought up the point of where it can go. And I know that we're just getting people familiarized with where it's at right now, but there are some really important points to, to look at as far as where it can go. That's utility. And so one of those things is, as I said before, and an NFT represents a digital file. Right. So you want to think about it as metadata in the back, cyberpunk world in the front, you know, crypto kitty in the front, metadata in the back. So right now we're using it for art. That's where the craze is. That's where, that's where pop culture kind of launched, launched this whole concept. But the way I view NFTs as being utilized in the future is in the form of data packets. Now, the difference between dollars and data is that data has a very potent utility outside of it's just transactional thing, right? So money is powerful because it's transactional. The more money I have, the more transactions I can make. When it comes to data, you can also use it to make transactions, but data in itself is useful. Like code is useful. You can create things with it, right? I can use data on you to sell you more things. I can use data on you to strategically plan my next move around you or your demographic or whatever it is, you know, like data has power outside of its transactional utility. Right. And so like one of the concepts that I really like is this idea of creating a data package that I can then sell to a company as opposed to, you know, maybe Facebook taking my data and selling it to a company, right? So let's, let's just example. I have a group of 10 friends and we're all gamers, okay? Or we're just like a group of gamers. And we account for about 80 to 120k a year in gaming expenses, like we buy, right? Between the hardware, the software, the in-game add-ons, the 10 of us, we spend about 80 to 120k a year. Now, when we buy the most, how we buy the most, what incentivizes us to buy the most, when do we buy the least, all this information is useful for a game-developing company. All this information is useful for a manufacturer, for a marketing company. This is useful data. So if we as a society learn how to harness our data and create packages, we can then say, okay, you want this information, it's one eighth. And that becomes your NFT. That becomes your data packet as opposed to a crypto kitty. Right. And sell it. Same goes for medical information. Instead of having to go to the doctor and fill out 20 pages of how dizzy and how many headaches I've had in the last week, you know, you just have this data packet with all your medical information, with your birth certificate on it. And then you can share that with your medical provider, right? Or you can share that information with medical research. If you have a certain condition, you don't want to share with everyone, it's a private key, but you can share it with a certain medical research facility for the purpose of a certain study, right? And you can sell that. Right. Makes sense. It makes so much sense. So I guess for someone that's just getting started in this space that's brand new, doesn't really know too much about it, how would they go about buying and trading NFTs? So I actually have two awesome videos on YouTube. I can share the link. So I actually created two videos with a gentleman by the name of Gus Gigi. He's what the industry calls an OG crypto artist. That means he's been creating crypto for at least five years, crypto art. For at least five years. Basically, the first thing you want to do is get an Ethereum wallet. Okay. Different cryptocurrencies have different wallets. Some do a variety, but the one that I like to use is MetaMask. That's a really common one. That is a specifically Ethereum wallet, because as we mentioned, NFTs are backed by Ethereum. They're on the Ethereum blockchain. So you have to have a crypto wallet that is an Ethereum wallet. So MetaMask is the first thing. The second thing is you can go on a number of platforms. OpenSea.io, Nifty, Gateway, Rarible. And then there's a few other ones that are harder to get into. A very well known one is Super Rare. Codex is like a high-end luxury NFT, NFT minting site. So you can go on any of those websites. And the process is very self-explanatory. It's literally like uploading a file, uploading the information on it, and then how much royalties, the description, and then you mint it. The only thing that you have to make sure to have is a little bit of ethane your wallet, because you have to pay the gas fees. And the gas is what we're talking about earlier. It's the transactional fee, because NFT is the data. It's the data. It's the contract. The Ethereum is what fuels the transaction. Every time you buy or trade an NFT, there's gas fees included in that. Absolutely. And so what you can do is you can either have a friend send you Ethereum, you know, a really generous friend, send you some Ethereum, or you just go and buy some. I need friends like that. That'll just send me a share. Yeah, and then send you a number, and then you can offer friends. Those are the type of friends I need. Yeah, for sure. And another thing that is important to know, and we talked about this a little bit in the video, is, you know, gas fees fluctuate based on the market. So I do recommend, you know, looking at some websites that will tell you what gas fees are, when the best time to buy is, when the best time to sell is. That makes sense. Yeah, that makes sense. Yeah, there's a look for that. Awesome. And there is also an upgrade coming to Ethereum around July or August that should lower all gas fees going forward. So that should also help, I would imagine, with NFTs the whole space. Absolutely. So I'm glad you brought that up. It's been one of the more controversial points about this whole craze. So ETH2 is what you're talking about. And basically, you know, these transactions requires a lot of computational power. And computational power generates heat, and that burns energy. And so because there's such a craze and there's so many transactions happening at once, it's creating a lot of heat and burning a lot of energy. And, you know, there's different debates about how severe it is, how much it's actually impacting the world. It's definitely something to research and stay up to date with. So yeah, so ETH2, ETH.2 is actually, is what you were talking about. They are looking at more sustainable ways of generating these transactions, of sustaining these transactions in this market, because as we mentioned, these transactions require a lot of computational power, and this computational power generates a lot of heat, which burns energy. So one of the things to look into is the difference between proof of work and proof of stake. And basically what that means is that instead of working computers to fuel the transactions, proof of work, right? The more you work, the more this fueling industry, proof of stake is what's going to redefine the sustainability, and that's how much Ethereum you hold. And, you know, you can just infuse the database with Ethereum as opposed to mining, right? Your stake, what you already have, then that's going to be used to fuel the market, to fuel the industry. Right, and it'll be more efficient overall, which is one of the main things that a lot of people bring up is always about mining and energy, the use of energy. So that would fix that issue. That's what we hope. That's what we're looking towards. It's definitely a solution that's on the table. We got to see how it all plays out. So I think we've pretty much covered everything that I wanted to ask, and I know a lot of people have been asking me, and you gave us a lot of information on NFTs. So I appreciate that. You know, let us know anything you have going on. What projects do you have coming in the future and all that. So on March 26th, we are actually representing an artist by the name of Jack Storms. We are having a hybrid auction. So it's a really special event. Jack Storms is actually a sculptor. He's a glass sculptor. He's had a couple of his pieces in the Guardians of the Galaxy movies. And he's actually created a sculpture that we are going to be auctioning for one Bitcoin. So there's going to be a physical sculpture. And then from that sculpture, we're going to be creating five NFTs. And those NFTs are also going to go up for auction. So if you want more information on that, how you can bid, how you can be a part of the event, if you're local in Miami, you can go to bitbazzle.miamy and just sign up. Awesome, awesome. And where can people follow you? So you can find us on www.vividreality.solutions. If you want to see more about hybrid assets or how we digitize real world assets. And currently we're working with Bitbazzle. We're doing a lot of work with them. So if you want to check out some events, coming up, we have one this month, we have one next month, and a few coming up in the summer with regards to crypto art and crypto in general, you can visit bitbazzle.miamy. Amazing. Thank you so much, V. I really, really appreciate you giving us some time and explaining to myself and the rest of us watching this video exactly what NFTs are and how they work. Because a lot of us really don't know. So I appreciate it so, so much. We'll definitely have to do something else sometime soon. Absolutely. Thank you so much for having me. It's been awesome. I hope the information helps give a little bit of insight. And yeah, let's see what we create from here. Awesome. Thank you so much. Bye. Alrighty guys. I hope you enjoyed this video and I hope you found value in this content. Let me know if you guys want me to continue doing more interviews with different people in different spaces and just to get a different perspective in someone that's specializing in certain things in the crypto space. If you guys found value in this content, make sure to hit that subscribe button, guys. Hit the like button as well and turn on that notification bell. If you guys are interested in following V, make sure that you go down to our description and you have her social media links where you can follow her. That's pretty much it for this video, guys. I hope you guys have an amazing, amazing day. I will see you guys on the next one. As always, peace and love.