Non-fungible tokens (NFTs) have captured the world's attention, revolutionising the digital asset economy in unprecedented ways. The impact goes beyond the digital asset realm, reaching global economies and the lives of individuals, particularly artists who now have a marketplace that recognises and directly rewards their value without intermediaries.
The NFT sector is rapidly evolving and gaining widespread acceptance and adoption. Why is this happening? The market for digital collectibles holds immense promise, and NFTs have unlocked its potential. Digital art, music, and other unique digital assets marketed as one-of-a-kind NFTs dominate the NFT market. This, in turn, has given rise to new marketplaces.NFTs have empowered creators, collectors, and artists to directly sell, track, and own their creations. Furthermore, they have facilitated the creation of networks for trading and sharing digital content. To grasp the significance of this sector, its growth, and its future, it is essential to delve into the history of NFTs, their evolution over time, and the specific catalysts that led to their explosive emergence.
By exploring historical NFTs that have transformed and continue to reshape the entire industry, we gain a deeper understanding of the sector's importance and its trajectory.
Top NFTs that laid the foundation
→ Quantum - 2014
The first NFT was Quantum, created on Namecoin in 2014 by digital artist Kevin McCoy. Quantum was the first NFT ever built and the first NFT purchased for $1.47 million at Sotheby's Native Digital auction in 2021, making it one of the most coveted and costly digital artworks. The sale of this digital artwork established a standard and formed the groundwork for subsequent NFTs.The NFT trading and ownership transfer processes saw challenges and setbacks during the token's creation, despite the tremendous success in selling the token for a significant amount of money. A lawsuit for ownership disputes brought on by Namecoin, which sued McCoy because he ignored the obligation for regular renewal of registrations on Namecoin in 2015, was one of the biggest challenges. Even though they were regrettable at the time, these issues led to the development of more NFTs that would address the problem and promote the expansion and development of the NFT industry.
→ Spells of Genesis - 2015
Spells of Genesis was first introduced and developed in March 2015 by Shaban Shaame, CEO of EverdreamSoft — a company that produced the first blockchain-based mobile game called Spells of Genesis, or SoG, developed on the Bitcoin blockchain. As the first blockchain trading card game, it significantly increased in popularity, ushering in a new gaming era and laying the fundamental groundwork for gaming NFTs, where players have true and total control over their digital assets. An established benchmark for using NFTs in gaming experiences was also made possible by creating this game.SoG mixes the point-and-shoot features of arcade games with the trading card game (TCG) functionality. For the purpose of combat, players must gather and mix cards to build the most powerful deck. As they explore the fantasy world of Askian, players can collect, trade, and combine orbs to assemble the strongest squad and face various opponents. They can also use any blockchain-related collectables in their wallet or purchase in-game cards to later "blockchainize."
→ Rare Pepe - 2016
Rare Pepes are collectable digital trading cards that mimetically explore the cartoon frog Pepe to varying degrees. These digital trading cards were first minted in September 2016 by blockchain pioneers, and they turned out to be the next big thing that would not only pave the way for the NFT industry but the crypto art industry as well.Those above were achievable because these tokens were the first to experiment with art on blockchain technology, which inherently led to a significant influence, advancement and progression that would help to build and root the crypto art movement.
Shortly after the digital trading cards were released in 2016, Joe Looney created the Rare Pepe Wallet. This web-based, encrypted wallet enables users to purchase, sell, and keep rare Pepes using a currency called PepeCash. Based on the Bitcoin network, the Counterparty platform is the basis of the Rare Pepe Wallet. Due to the wallet's creation of a new market that allowed investors or buyers easy access to collect, display, and exchange Rare Pepes-specific trading cards, the popularity of Rare Pepes as digital collectables began to increase.
It's vital to note that, before the wallet's development, few technologists and even fewer Blockchain gaming companies were considering the idea of tokenising assets, which is essential to comprehend how the Rare Pepe wallet opened the path for the evolution of NFTs. Anyone could submit designs to make Rare Pepe cards with Rare Pepes as long as they put in the barest of efforts and adhered to the "safe for work" regulation. By doing this, Rare Pepes enabled hundreds of new users and collectors to create cryptographic works of art. As a result of the large number of cards produced, the meme's attention has shifted to describing its Blockchain characters and history.
Giving Joe Looney all the credit and recognition without mentioning Matt Furie, an American artist who first developed the character Pepe in 2005 for his self-published zine Playtime, which would later become a boy's club and featured slacker roommates in their post-college period, would be highly unethical. When Matt scanned the comics and uploaded them to his Myspace page, the online bodybuilding and anime communities were the first to notice them, and they quickly spread everywhere. On the other hand, the Rare Pepe project developed from Pepe's rapid climb to fame as the internet's mascot, which peaked in 2014 when celebrities started to share the popular frog memes on their social media accounts.
Rare Pepe NFTs could only initially be traded on Counterparty. But a few people who were at the time owners of Rare Pepe employed Emblem Vault, a software protocol, to reconfigure their NFTs on Ethereum in response to the NFT explosion that occurred in 2021, which resulted in a sharp rise in sales and popularity of NFTs. Due to this, several Rare Pepes were advertised on OpenSea, the most popular peer-to-peer NFT marketplace in the world, and sold there.
The 36 series is an assortment of almost 1,800 Rare Pepe NFT cards. Due to its rarity and value, Series 1 Card 1 is this collection's most sought-after and precious card. Satoshi Nakamoto, the mysterious person who created Bitcoin, is honoured by the cards. There are 300 unusual NFTs, and one of them, known as the Nakamoto Card, can provide entrance into the restricted 300 Club. Thus, Rare Pepes had an enormous impact that would lead to the emergence and advancement of the crypto art world and the NFT and blockchain sectors.
→ CryptoPunks - 2017
As part of a playful experiment in digital collectables, Matt Hall and John Watkinson, the owners of the Canadian software development business Studio Larva Labs, created the 10,000-strong collection of 8-bit pixel art characters with their unique features known as CryptoPunks NFTs in 2017. CryptoPunks is one of the most imperative and influential trailblazers of the NFT industry. The NFT is further significant because of the year it was launched and the fact that it is built on Ethereum's blockchain protocol.Given the history of the development of the NFT industry, this is of extreme importance. NFTs were created in 2014, but in 2017 through Ethereum, they started to gain greater traction and appeal. During this time, the first NFT collections on the Ethereum blockchain began to take shape, offering a long-lasting solution to the prior-existing problems with NFTs. Before this, trade and transferring ownership were tough with working blockchains; as a result, the industry became less popular. But later on, the Ethereum network added the capacity for smart contracts, enabling the integration of token creation, coding, storage, and trading into the blockchain itself. NFTs may now be accessed more freely, with fewer limitations, and with simpler onboarding because of these extra features.
Following 2017, NFTs saw their most remarkable rise due to a spike in interest that raised their worth and price due to their inherent popularity. The two major elements that significantly modernised and fueled the digital asset market and its technologies were the COVID epidemic and increasing demand for high-value artwork sales.
In light of this, CryptoPunks became some of the most precious and sought-after NFTs on the market in 2021, which caused their popularity to soar. In addition, Bored Ape Yacht Club, also known as BAYC, is a collection of 10,000 non-fungible tokens (NFTs) on the Ethereum blockchain and was founded by CryptoPunks, one of the largest NFT collections. These NFTs are graphical depictions of apes that resemble cartoon characters and are distinguished by their metadata, including the characters' backdrops, jewellery, clothing, fur, and eyes. The BAYC collection became one of our generation's most well-known and significant NFTs.
CryptoPunks are precious because they are one-of-a-kind, with some being more valuable than others because of their unique qualities. On February 12, 2022, the most costly CryptoPunk was sold for $23.7 million, more than twice the price of the next-highest-grossing punk. The NFT business has greatly benefited from CryptoPunks' success, and new initiatives that aim to duplicate it are now possible.
→ Crypto Kitties - 2017
As mentioned above, 2017 was a prominent one in the history of NFTs, especially with the introduction of NFTs like CryptoPunks, which laid the foundation and popularised the concept of digital collectables, leading to other popular NFTs and NFT markets. In November of the same year, CryptoKitties - a blockchain-based game where players can buy, breed, and trade digital cats using cryptocurrencies was developed by Canadian Studios Dapper Labs. Players can buy and breed virtual cats in this NFT collector game to trade them. Twelve distinct qualities, each with a variable rarity level, are present in every virtual cat.Additionally, the game's breeding mechanisms aid in transmitting cat traits to kittens. As a result, each virtual cat in the collection is a unique and rare NFT.
An interview was conducted with an NFT archaeologist from Bitcode Method who highlighted four factors that describe why this NFT is incredibly significant:
- The idea of digital scarcity is one of the critical elements behind Cryptokitties' success. Due to the individuality of each cat, players are prepared to spend more money to obtain rarer and more expensive cats, turning the game into a market for digital goods. The most expensive Cryptokitty ever sold was a pale purple cat named Dragon, which fetched a staggering 600 ETH, currently worth over $1,163,283.06.
- As they helped popularise the concept of digital collectables and showed the potential of NFTs in the gaming industry, Cryptokitties were important in the growth of the NFT business. Numerous other NFT ventures, including digital art and virtual real estate, were inspired by the popularity of Cryptokitties.
- The advancement of the Ethereum network was one of Cryptokitties' most noteworthy and prominent effects on the NFT market. With the growth in popularity of the game came many additional transactions on the Ethereum protocol, which led to increased congestion and delays. As a result, layer two solutions like Polygon and Optimism were developed to address the Ethereum network's scalability issues.
- The popularity of Cryptokitties demonstrated the potential use of NFTs, sparking a surge in traditional sectors' interest in blockchain technology. Since then, NFTs have been applied across various industries, including fashion, music, and sports, to produce distinctive and priceless digital assets. Cryptokitties affected the NFT sector and the blockchain gaming sector, which also helped expand. Due to the game's popularity, it was clear that there was a market for blockchain-based games and that new gaming genres might be developed using blockchain technology. Since the release of Cryptokitties, several blockchain-based games have been created, some of which use similar ideas of digital scarcity and ownership.
- Establishing NFT standards was another significant effect of Cryptokitties on the NFT market. It was challenging for developers to construct and work with NFTs before Cryptokitties because there needed to be established standards for NFTs. The ERC-721 token standard, developed by the game's creators, established guidelines for producing and administering NFTs on the Ethereum network. A standardised framework for developing and exchanging NFTs is widely used throughout the NFT industry thanks to the ERC-721 standard.
→ Axie Infinity - 2018
The first Ethereum-based NFT game to surpass $1 billion in revenue as of August 8, 2021, was Axie Infinity - it is the most popular non-fungible token (NFT) game and one of the highest-earning NFT games presently being played by over 2.78 million active players. The game was created by the Vietnamese studio Sky Mavis. In this Pokemon-inspired game, you can assemble a group of animals called Axies to employ against other players in the Arena mode or foes in the Adventure mode.Axie Infinity Token (AXS) and Smooth Love Potion (SLP) are the native currencies used and acquired in the game. AXS may be obtained by ascending the PVP leaderboard, while SLP can be obtained by completing the adventure mode's levels and triumphing in arena battles. It takes both tokens to breed an Axie, and you can only do that if you already have two Axies. Each Axie is a non-fungible token (NFT) with a distinct set of body pieces that define its abilities and rarity. Infrequently, they have sold for hundreds of thousands of dollars, as the Dragon Axie auctioned off for a stunning 750 ETH, equal to $206,000! They may usually be purchased for $100 to $1,000.
The play-to-earn approach, community-driven development, and creative use of blockchain technology in the game have all contributed to its popularity since its 2018 release. With the ability to earn crypto tokens through gameplay, the play-to-earn model naturally attracts a varied user base of people from developing nations. The play-to-earn approach in blockchain-based games was made famous by Axie Infinity, and many other blockchain-based games have been influenced by it. The development of the blockchain gaming market was aided by the success of Axie Infinity, which also demonstrated the potential of blockchain technology to open up new avenues for personal financial freedom. Overall, Axie Infinity is an innovative game that has shown the functionality and potential of NFTs in the gaming sector.
→ NBA Top Shot - 2020
NBA Top Shot is another historical NFT popular within the NFT marketplace. This NFT is a blockchain-based platform allowing NBA fans to purchase, sell and trade officially-licensed NBA digital collectables representing captured highlights and moments from NBA games, including dunks, three-pointers, and game-winning shots.NBA Top Shot has revolutionised the world of sports collectables since it bridged the gap between digital assets and traditional sports. Not long ago, it seemed unlikely for a major sport to engage with digital tokens, but their partnership gave legitimacy to the crypto-verse and its technology. The growth of NFTs and cryptocurrencies gained trust as having such an NFT gave assurance that would spark interest in the industry. Moreover, NBA fans have unprecedented access to unforgettable historic moments in the game, potentially earning money from these cherished moments.
For those with doubts, the evidence is clear: there are countless reasons why and how NBA Top Shot has been vital to the growth of the NFT industry. To start, this virtual platform has had over 1.1 million registered users trading more than $800 million worth of NFTs in 2021 alone. In addition, it is credited for bringing mainstream awareness to NFTs and their potential for sports leagues such as the NBA, MLB, and NFL. This has exponentially increased the reach of the NFT industry, showcasing its various uses beyond art and gaming.
The success of NBA Top Shot also created an alternate revenue source for the NBA and its players - each sale produces a percentage that goes towards them. This newfound money-making opportunity could be a viable source of income for some players whose digital moments are highly sought after by collectors.
Furthermore, it has spurred on innovation with other platforms focusing on sports-related collectables opening up more investment options globally - including those with limited financial means who can purchase them through standard fiat currencies at relatively low costs (most often less than $100). With more people worldwide buying and trading moments on this platform, it's become a much more inclusive and diverse community not limited by geography or finances.
→ Art Blocks - 2020
Art Blocks is the top platform for generative art, one of the most well-known brands in the NFT industry. Some of the most expensive NFT artworks have been published on Art Blocks, and new creative initiatives are added each week. Erick Calderon, a pioneer in the NFT field, developed Art Blocks in 2020. He is renowned for elevating artists through Art Blocks and establishing generative art as an important sector of the NFT space through his influential Chromie Squiggles project.The idea behind the founding of Art Blocks was to create a platform focused on NFTs, offering fully encrypted properties. The initial collection, Chromie Squiggle, was renowned for its simplicity, composed of 10,000 separate pieces, each with different colours, opacities and textures. This platform has been incredibly successful - with a total sales volume of $1.4 billion, including individual pieces which have sold for over $1 million each! As of April 2023, there have been around 240 thousand transactions on this platform - resulting in 1.39 billion U.S. dollars of sales.
This unique Ethereum-based generative art NFT platform offers a programmable and one-of-a-kind experience - in that when someone purchases an NFT, they will know exactly how it will look after they've minted it. Generative art NFTs use a range of algorithms to autonomously create one-of-a-kind pieces - as each piece is based on random code and strings that reference the algorithms developed by the artist.
To make their design into Art Blocks NFTs, an artist simply needs to upload their algorithm onto the platform and set the number of NFTs to be minted. Then using blockchain technology, an investor can mint an NFT from the project and receive their uniquely generated results directly! This isn't only for artists; everyone can follow this process and purchase their own generative art NFTs.
→ Bored Ape Yacht Club - 2021
BAYC is an incredibly popular PFP NFT - unique digital assets that serve as profile pictures for their owners. These NFTs are typically sold in limited quantities, and each is unique in some way, either through its design, colour scheme, or other distinguishing features. One of the critical benefits of PFP NFTs is their rarity.The Bored Ape Yacht Club (BAYC) has enormously impacted the NFT industry since its launch in April 2021. Each BAYC NFT is entirely unique, featuring different combinations of fur colours, accessories, and facial expressions that influence their rarity and value in the secondary market. The team also created an exclusive website for owners with a members-only clubhouse and a merchandise store.
Due to its unique design and strong community element, the BAYC has become a status symbol for collectors and investors, some even selling for millions of dollars. This community has allowed members to interact with each other and access exclusive events, inspiring other artists to create their own NFT collections and generate significant revenue through sales.
Moreover, the BAYC has achieved notoriety within and beyond the NFT space - into the cryptocurrency and investment communities. This has made NFTs more accessible to a broader audience while creating a more diverse collector base through donations to charitable causes.
The Bored Ape Yacht Club has revolutionised the world of NFTs by introducing a unique design, a strong sense of community, new revenue streams for creators, and an inclusive collector base - all of which have been integral in growing the industry.
In summary, understanding the history of NFTs is essential as they have shaped blockchain technology and created new marketplaces for valuing digital content. Since 2014, the NFT industry has grown exponentially, revolutionising art and gaming. Platforms like CryptoKitties, Axie Infinity, NBA Top Shot, and Bored Ape Yacht Club demonstrate the lasting impact of NFTs, enabling creators and gamers to monetise digital assets and build passionate followings.
NFTs eliminate intermediaries in traditional sectors, providing equal financial opportunities worldwide regardless of background. They simplify copyright issues, allowing artists to prove ownership and monetise their work without relying on auction houses or dealers. Gamers now possess unique in-game items with real-world value, creating new gaming economies.
NFTs will continue shaping our future, offering transparency and financial autonomy globally. Learning about NFTs helps comprehend their disruption in creative industries and gaming markets.
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