It is hard to read anything these days without some mention of NFTs, non-fungible tokens. Earlier this month, Christie’s auction house sold a Beeple NFT collage “The First 5000 Days” for $69 million. Mike Winkelmann, Beeple, who operates on the interesting domain name beeple-crap.com, has used NFTs more successfully than any other creative. While NFTs are often associated with digital art, the concept can apply to any unique product. Domain investors have been rushing to register NFT-related domain names, and a few have invested directly in non-fungible token creative works. What is a NFT? Let’s start with the definition of a fungible asset. If I borrow $20 from you, and then later repay, I don’t need to give you back the same $20 bill, as it is commonly agreed that another $20 bill has equivalent value. These are fungible assets, and would include cash, stocks, cryptocurrencies, commodities and numerous other items. The item has a value that is not associated with being unique. A non-fungible token, or NFT, is data stored on a blockchain ledger that represents a unique, usually digital, item. The NFT establishes ownership and authenticity, although see caveats below. While NFTs are often associated with digital art, they can represent any unique item, and have been sold for music, written works, video clips, trading cards and other products. What you receive as owner of the NFT varies. In essence you are claiming ownership of the digital token associated with the work. You do not own the original artwork, nor the associated copyright. Various add-ons are sometimes included, such as tickets to private performances or unique unpublished associated work. History and Applications of NFTs While the roots of NFTs date to at least 2014, several NFTs released in 2017 are usually considered the first real implementations. Matt Hall and John Watkinson released 10,000 unique CryptoPunks that year. This month, Kings of Leon became the first band to release an album as an NFT. The album, When You See Yourself, includes several types of add-on personalized assets, including front-row concert seats and exclusive audiovisual art. You can see more about the digital content, and how the redemption works, at the site of the company that developed the NFT for the band, YellowHeart.io. While NFTs represent unique products, NFTs are extensible. You can use two NFTs to ‘breed’ a new NFT. This is perhaps best exemplified by Cryptokitties. Blockchain technology has been mature for a while. Why did NFTs suddenly take off in the last few months? There are probably several reasons. NFTs permit artists to circumvent intermediaries and interact directly with fans and clients. That has become more important during the pandemic. The rapid rise in cryptocurrencies has created new wealth for some. Those who benefited from the rise in Bitcoin are exactly the same people open to the idea of other types of blockchain-enabled assets, such as NFTs. NFTs make it easier to exchange, including fractional ownership, valuable creative works associated with tokens. The current financial market has people looking to diversity to different types of assets beyond traditional stocks and bonds. An Unregulated Market There are a couple of caveats to keep in mind when considering NFTs. While the authenticity of the ownership chain is established on the blockchain, there is no automatic guarantee that the original NFT was indeed by the assumed creative. It is important to do your due diligence before purchasing a NFT. Secondly, the NFT field is essentially unregulated. Auction houses selling some of the products are, of course, regulated, but NFTs in general are not. Registrations of NFT Domain Names If the current rise in NFT interest continues, we will see a variety of websites handling NFT transactions, and a corresponding need for domain names. According to dotDB, the acronym NFT is registered in 513 domain extensions. The plural, NFTs, is registered in 351 TLDs. NonfungibleTokens is taken in 90 extensions, and the corresponding singular form in 110. Strictly speaking, non-fungible is usually considered a hyphenated word. The hyphenated term non-fungibleToken is registered in 58 TLDs, while the plural non-fungibleTokens in 24. There are a number of NFT-related discussions on NamePros, but the first places to discuss and showcase domains related to NFTs was started by @newshunter. More recently, @du6262 started Are NFTs a Trend?, which has become very active. This post by @NameYourself shows the number of NFT-related domain names registered each day in 2021. There have been typically 400 to 1200 NFT .com domain names registered per day during the past month, and a total of more than 30,000 NFT-related domain names registered so far this year. Dofo advanced search indicated just over 9200 .com domain names including NFT were actively for sale, but this does not include the fully written out words or other forms. NFT Domain Name Sales Below are some NFT sales listed on NameBio. See the NamePros threads listed in the previous section for additional sales. NFT.com, $50,500 (2016) NFT.app, $50,000 (2021) NFTinvestments.net, $5105 (2021) BitcoinNFT.org, $5000 (2021) NFTs.net, $3488 (2021) nfter.com, $3200 (2021) NFT.info, $3023 (2021) NFTnation.com, $2500 (2021) NFTgram.com, $1951 (2021) NFTnet.com, $1088 (2021) Most of the sales are vert recent, the majority within the last month. The acronym NFT is selling better than the full words. Domain Names as Non-Fungible Assets As I was researching and writing this article, the thought occurred to me that domain names are in essence already the ultimate non-fungible product. Each domain name is unique with authenticated ownership, the key aspects of a non-fungible resource. What about viewing those who create domain names as domain artists? Might a domain name created by a highly respected domain artist, authenticated within the blockchain, add prestige to a brand? What else, beyond the domain name and domain artist information, could be included in the digital asset? Perhaps the story of the creation of the name - the date, inspiration and background could be included, or a personal message from the creator. A logo, or logo set, is another obvious included digital asset, again with information on the logo artist and an authentication guarantee. But the associated assets could extend beyond that. What about digital art, music clips, or video creations that would be guaranteed authentic and for use exclusively by that brand? While such domain name NFTs would need to be sold for higher prices, to account for the various creatives who had a role in creation of the package, major businesses might well be willing to pay that for the prestige of a professionally created domain name NFT. It would be akin to a famous architect designing your headquarters building. Final Thoughts If looking to read more, this article on Non-Fungible Token (NFT) at Investopedia gives a concise explanation that focuses on the opportunities of the technology. They summarize the advantages this way So what do you think? Are NFTs a short-term bubble? Will some make a lot of money on NFT holdings and many lose money? Will we still be talking about NFTs in five years time? What about DFT domain names - what sort of valuations to you see? Do you think that domain names could come to be viewed as the ultimate non-fungible tokens? The idea for a NamePros Blog article on NFTs was suggested by @oldtimer. Thanks to NameBio and Dofo for data used for this article.