What Are Non-Fungible Tokens and What Do They Tell Us About The Today’s Job Market?
November 1st, 2021
Last Updated on November 1st, 2021
This text was fully written by humans.
SUMMARY / KEY TAKEAWAYS
- NFTs are unique digital assets: non-fungible tokens are cryptographically unique tokens linked to digital content, such as artwork and music, unlike interchangeable currencies.
- CryptoKitties pioneered the category: launched in 2017, CryptoKitties became one of the first popular NFT collections and even congested the Ethereum network.
- Collections are generated and minted on a blockchain: creators typically use graphics-mixing software to produce thousands of unique pieces, then deploy each one on a blockchain such as Ethereum or Solana.
- Community, not craftsmanship, drives value: projects such as CryptoPunks and the Bored Ape Yacht Club show that exclusivity and community membership, more than artistic effort, determine an NFT’s price.
- The NFT frenzy signals a broader shift toward the internet: it points to the rising importance of online communities and suggests that the job market will keep moving toward remote, digitally native work. Trends like this are a clear part of broader future of work trends for 2027, as more careers become tied to online communities rather than physical offices. Watching future of work trends for 2027 closely can help professionals anticipate which digital skills will matter most.
Table of Contents
- What Are Non-Fungible Tokens (NFTs) And What Do They Have To Do With The Job Market?
- The Beginnings of the NFT Frenzy: The CryptoKitties.
- Why Did NFTs Make Such a Spectacular Career Now In 2021?
- How Are NFT Collections Made?
- How Do You Mint and Trade an NFT?
- On The Skyrocketing Prices of NFT Collections.
- On The Value of Communities.
- Why Did These NFT Communities Become So Popular?
- What Can I Gain From This Knowledge?
- Shall I Join The NFT Movement or Create My Own NFTs?
- So, What Does The NFT Frenzy Tell Us About The Society and the Job Market?
- How Is Digital Life Reshaping Real-World Careers?
- What Specific Job Market Shifts Should Professionals Expect?
What Are Non-Fungible Tokens (NFTs) And What Do They Have To Do With The Job Market?
What are non-fungible tokens, also known as NFTs? And what do they tell us about the condition of today’s job market? Although NFTs exist for a few years now, they came into the spotlight earlier this year. What does “NFT” even mean and why it got the attention of (young) audiences around the globe?
According to decrypt.co, “non-fungible tokens (NFTs) are cryptographically unique tokens linked to digital content, such as artwork and music.” Uniqueness means that, unlike, for example, units of money or simple utilities, these assets are not interchangeable. Phenomena like this are a good illustration of navigating career change in the AI era, since entirely new categories of digital assets and jobs keep appearing. Professionals focused on navigating career change in the AI era increasingly need to understand emerging technologies like this, even outside their core field.
For instance, “Mona Lisa” is a unique asset, and you cannot swap it for another painting without a loss in value to its owner. A given 5-dollar bill works differently: you can swap it for any other non-forged 5-dollar bill without any loss.
NFTs are commonly associated with web3, the next stage of the development of Internet. This development assumes democratization and decentralization of our online activity.
Cryptographic tokens mean digital assets that exist on a decentralized ledger, in essence, on a blockchain. In practice, the blockchain engraves the access keys to the assets, not the assets themselves.
For as long as you possess these keys, you are the formal owner of the asset. Selling means passing your keys on to someone else while the whole network witnesses the transaction. What kind of assets can you possess?
Well, NFTs initially made a career as a way of tokenizing art and unique objects traded between gamers. In theory, however, they might represent the ownership of any off-chain object, from a car to a house.
The Beginnings of the NFT Frenzy: The CryptoKitties.
As mentioned before, NFTs are not as new as an invention. Back in 2017, CryptoKitties – collectibles implemented on the Ethereum blockchain – have become one of the first popular collections of NFTs. They raised in popularity so quickly that, by December 2017, they took over 12% of the Ethereum network’s hashing power. As a result, they clogged the whole network!
What was so appealing about CryptoKitties? Well, every kitty had a few distinctive features. These included the color of the fur, the pattern on the fur, and the type of the tail. Interestingly, two CryptoKitties could breed a new kitty according to a stochastic mechanism governed by the genetics of sorts.
Namely, the distinctive features of kitties were coming in a number of variations with certain probabilities. If lucky enough, you might breed a rare combination of features. Such a combination would guarantee a high value of the kitty on the free market.
At the same time, collectors generally believed that early generations of kitties were more valuable than late generations. Overall, within just a few days, breeders and traders created a whole new market for kitties.
Why did CryptoKitties become so popular? Well, some of the reasons are obvious: all cats are cute. Furthermore, the thrill associated with waiting for the outcome of crossing kitties can be extremely exciting. Will I hit the jackpot this time and get a unicorn-rare kitty?
With time the popularity of CryptoKitties declined, partially because of the fact that the kitties’ supply is potentially unlimited. The prices went down and haven’t recovered since, however, CryptoKitties have remained popular among cat- and blockchain fans.
Why Did NFTs Make Such a Spectacular Career Now In 2021?
Why have NFTs become such a big deal now in 2021, after a few years of silence? Well, there are a few reasons. Firstly, the overall adoption of blockchain progressed since then, and the market now accepts blockchain-based projects.
According to Forbes, the combined market capitalization of major NFT projects grew by 1,785% in the first three months of 2021 alone, illustrating just how quickly the space took off.
In particular, modern artists, from visual arts to music, embraced blockchain. In fact, reputable art marketplaces such as the famous Christie’s Auction House now list digital art, including non-fungible tokens, in their auctions.
Famously, a bundle of CryptoPunks was sold for 17 million at Christie’s in May this year. Such success stories legitimize digital assets in the eyes of public opinion. They also boost the interest of both art buyers and artists in the space.
How Are NFT Collections Made?
NFT collections usually consist of 1,000-10,000 unique pieces. With the exception of a few hand-made collections by artists (such as Crypto Hobos), graphics-mixing software generates them automatically.
The idea is simple: you take a character with a few features. Namely, these four features are hat, facial expression, t-shirt, and background.
You make, say, 10 variants of each feature with different frequencies. For instance, a yellow t-shirt might appear in only 1% of all cases. A red T-shirt, meanwhile, appears in 20% of all characters.
Then, since 10 to the power of 4 equals 10,000, mixing these graphics gives you 10,000 unique combinations. And since variants have a different frequency, some of the outcome pieces are rarer and thus more desired than others.
You can find such mixing software in open source, for example in the HashLips libraries on GitHub, which means that anyone with basic programming skills can create a new NFT collection. Indeed, no wonder new collections come out every single day!
How Do You Mint and Trade an NFT?
Creators deploy a new collection on a blockchain, which assigns every NFT in the collection a unique, tamper-proof identifier. The process of deploying an NFT on the blockchain is commonly referred to as “minting.” Usually, the minting process is blind. This means that the buyer doesn’t know whether their NFT has any rare features before collecting the piece.
Currently, the most popular blockchains for the NFT creators are Ethereum and Solana. You can observe upcoming new collections via the Rarity Tools website.
Similarly, the secondary market is even more popular. You can buy second-hand NFTs for example from the Opensea platform. “Flipping NFTs” has become a sort of profession in a career path or professional development. In fact, for thousands of young people, it’s also become a favorite sport.
On The Skyrocketing Prices of NFT Collections.
It cannot go without notice that some of the NFT collections have reached unprecedented prices. The aforementioned Opensea by Larva Labs is an exclusive collection of 10,000 pieces of unique pixelated art. Notably, cyberpunk culture and Daft Punk music inspired the collection.
Larva Labs gave the punks away for free back in June 2017. Today, however, you need to spare at least half a million dollars to land a piece. Yet another popular collection of NFTs is the Bored Ape Yacht Club. Released in May 2021, the pieces from this collection now sell at $130,000-$170,000 apiece.
In fact, there are hundreds of collections trading for thousands of dollars a piece. As a result, you can find and purchase them at the Opensea marketplace.
What are the reasons for this surge in the pricing of digital assets? Why are some of the collections worth tens of thousands of dollars a piece? Meanwhile, others get overlooked by the blockchain community and end up traded for pennies.
Well, in traditional, old-school art, experts usually assess the value of artwork. Of course, the beauty and value of some famous pieces have been subject of pul debate over the centuries. For example, van Gogh’s “The Potato Eaters” is one such piece. However, in most cases, the experts reach a consensus on whether the given piece is valuable, regardless of the taste. Shifts in how value gets decided are part of a larger pattern in how automation is reshaping careers, moving authority away from traditional gatekeepers. Understanding how automation is reshaping careers can help professionals see why community and network effects now matter as much as formal credentials.
On The Value of Communities.
In contrast, in the blockchain community, buyers assess the value of art differently. When exploring the Opensea database, you can easily notice something surprising. The pricing has little to do with the amount of effort put into creating the token, or its looks. Essentially, it is because while purchasing an NFT, you don’t buy the digital asset per se.
In fact, you buy access to the exclusive community of the token holders. And, given that these tokens cannot be bred like CryptoKitties, that’s the real value behind the token.
For instance, CryptoPunks is a community that runs its own Discord server. Anyone can join this server. Yet, the community reserves one channel for verified CryptoPunk owners, who can chat there. In other words, this exclusive right to speak with other verified owners is what built the prestige of the collection.
Why Did These NFT Communities Become So Popular?
The Bored Ape Yacht Club gives its members other perks, such as the “Bathroom.” This is a virtual room where the ape owners can collectively draw on an online board. You might think, “Why would the right to draw together with a bunch of rich kids whom you don’t even know by name be worth $200k?” Apparently, too many people, it is what makes the community different and valuable.
One of the reasons why these communities became so popular, is also their modest origins. Creators originally either gave away both CryptoPunks and Bored Apes for free or sold them at affordable prices. For example, traders exchanged Bored Apes at $300 a piece. That price wasn’t much more than the transaction fees on the Ethereum blockchain at a time.
Consequently, this creates an impression that the whole project is non-profit. Everyone, it seems, was welcome to join from the very beginning. It’s just that not everyone took the opportunity early enough.
Of course, the involvement of celebrities played a role as well. For instance, among the verified CryptoPunk owners, one may find Jay-Z, Snoop Dogg, Serena Williams, Jason Derulo, or Steve Aoki. Marshmello and Stephen Curry chose to join the Bored Ape Yacht Club.
So, who wouldn’t like to join their idols in an exclusive club listing a few thousand members? In short, what NFTs have become is effectively a ticket to a closed circle. These circles build their own internal, unique cultures: their own habits, memes, and jargon. Their own tribes.
What Can I Gain From This Knowledge?
You might be asking yourself, “What is in it for me?” What do NFTs have in common with professional development, career path or the job market as such?
If you are in the blockchain industry, the NFT movement might help you understand how this market grows and fluctuates. Indeed, the blockchain industry is not made of conference presentations performed by pretty people in suits and cocktail dresses.
Namely, it consists of thousands of Discord and Telegram communities growing their own tribes, or even, their own planets. The doors to these communities are wide open. Communities like this are becoming a real part of future of work and organizational change, since informal networks increasingly shape careers alongside formal employers. Paying attention to future of work and organizational change means recognizing that professional development now happens outside traditional institutions too. Once you spend an evening listening to the conversation, you will stop wondering how meme coins come about. You will also understand why one NFT is worth a million times more than another one that looks similar.
Well, you might benefit even if you are not into blockchain as such. Today, the strength of the associated community, rather than direct features, determines the value of many assets. Similarly, it works the same way when it comes to choosing houses, cars, or jobs.
And many new types of assets are different in nature from what they seem to be. For instance, they might look like pieces of art, cars, houses, or other items. In fact, they are tickets to a closed community of people who represent a similar lifestyle and/or values.
Therefore, before making any investment decisions, one might ask, “What is the associated community? How strong is it?” If the members feel a strong bond, you can expect your assets to appreciate in value. This is especially true when the community keeps the number of seats limited. Your ticket, in other words, becomes worth more over time.
Shall I Join The NFT Movement or Create My Own NFTs?
Well, everything comes to the end at some point. The prices of CryptoKitties went down since 2017. Thus, one can expect that at some point, the prices of NFTs popular today will also go down.
Many users swap NFTs, and that’s one of the reasons why the prices appreciate with time. At some point, this bubble must eventually pop. Consequently, that will probably happen right when the whole market crashes.
Furthermore, hoping that your NFT will sell at a high price is also futile. It is as likely as winning the jackpot in a lottery. You can create an NFT for educational purposes, however, you need to assume that you won’t earn from it.
The odds get worse once you factor in the projects that were sold as guaranteed winners and then went to zero. When a token pitched that way falls apart, some buyers try to argue the whole thing was really an unregistered security and a few of them end up talking to securities fraud attorneys who handle cases where investors were misled about what they were actually buying. Whether that argument sticks depends on how the token was marketed and what promises were made along the way. So treating an NFT as a payday, rather than a curiosity, tends to end badly no matter how you slice it.
Lastly, there is an overwhelming amount of scam in the NFT space. Notably, these scams are much more sophisticated than just a “simple,” “traditional” theft. You can, in example, lose all your funds simply by accepting an innocently looking “Trojan horse.” This means minting a free token containing a malicious contract. That contract will drain your wallet. The possibilities for fraud in this space are endless.
The best thing you can do for yourself is become a more vigilant observer of communities in your life. In particular, this applies both on- and offline. You should also better identify values and scarcity in these communities. And when you master this art, you can be sure of one thing. Sooner or later, a CryptoPunk of the next generation will land in your hands.
And if you decide to buy or mint your own NFT tokens, remember to protect your digital assets. Please find a review of the available protection methods HERE.
So, What Does The NFT Frenzy Tell Us About The Society and the Job Market?
Firstly, the way of valuing NFTs demonstrates clearly that communities and hiveminds rule the internet (and the society!) today. Namely, particular features of the projects, such as the NFT design, are not what matters per se. Rather, what matters is the exclusivity, or the vibe in the associated community.
And as such, the value is fluid and can change quickly. Importantly, it also demonstrates that a “community builder” or a “community booster” is one of the top professions of the future. It’s also one of the most attractive career paths.
Secondly, NFTs give people the chance to get into the sweet spot where they are members of a community. Understanding dynamics like this is part of learning how to stay relevant in the AI economy, where community and reputation increasingly influence opportunity. Professionals who know how to stay relevant in the AI economy tend to invest time in digital communities long before they need anything from them. At the same time, these people also feel unique, just as NFTs are, by definition, unique. That’s also what consumers love – they want to be a special fish in the pond, not just yet another fish. That’s also the key to winning consumers’ hearts today: customization of products and services.
Thirdly, when you enter the online groups around NFT collections, you will notice that members are helpful to each other. They are also polite and enthusiastic. You might think that hate does not exist at all!
And why is that? Well, being an active and supportive member of the community pays off. It can earn you whitelisting for minting NFTs from a new collection before everyone else, or even a free NFT. You just give people a little financial incentive to be kind, and they become the kindest people in the world!
Lastly, the success of NFTs suggests that there is a future in digital products and services in general. Trends like this point directly to career resilience in an AI-driven economy, where adaptability to new digital formats matters more than expertise in any single one. Building genuine career resilience in an AI-driven economy means staying curious about emerging technologies, even ones that seem unrelated to your field at first. Overall, this future spans everything from NFTs and the Metaverse to fully online schools, training programs, and telemedicine. The perception of the internet has now changed.
How Is Digital Life Reshaping Real-World Careers?
Namely, now, young people treat digital life as real life. In fact, they treat friends from the NFT communities as their “real-life” friends and even set businesses together. They would rather talk to someone from another corner of the world who understands them than to someone next door.
This trend also strongly suggests something important. In the near future, the whole white-collar job market and professional development will shift towards the Internet. According to the OECD, the share of job postings offering remote or hybrid work in member countries more than quadrupled between January 2020 and January 2023, underscoring how quickly professional life is moving online.
What Specific Job Market Shifts Should Professionals Expect?
The development of the Internet will have a significant impact on the working lives of professionals in the following aspects:
Professionals in digital technologies and services—programming, digital marketing, data analysis, e-commerce, and artificial intelligence—will have many opportunities. And they will be welcome in the job market.
Furthermore, there will be many new opportunities for professionals due to the growing Internet and expanding remote work. Many companies offer more flexible employment conditions and enable the creation of international teams around the world. Moreover, it also creates opportunities for entrepreneurs who can gain customers around the world. Remote work also affects the development of entrepreneurship and start-ups.
Online training (e-learning), discussion platforms, and webinar events will enable the education of professionals. They will also support the improvement of professional competencies and adaptation to the changing requirements of the job market.
Are you planning to upgrade your career to the next level or change your career path? Are you pondering your options? Don’t be alone in the process – join us at our live online Ontology of Value® Career Lab!
At this intensive online training, you will focus on discovering your identity as a professional, and learn effective career development strategies for landing great jobs.
We will help you choose the right career path, assist you in landing your new job, and teach you self-navigation strategies that will guarantee your success in professional development, and serve you for a lifetime!
Please find all the information about our incoming, game-changing program here:
Please cite as:
Ontology of Value (November 1st, 2021). What Are Non-Fungible Tokens and What Do They Tell Us About The Today's Job Market? Retrieved from: https://ontologyofvalue.com/what-are-non-fungible-tokens-and-what-do-they-tell-us-about-the-todays-job-market/
Do you find this article useful?
Today, it is becoming extremely hard to get noticed online as the Internet is flooded with massive amounts of AI-generated content. Therefore, it would greatly help us if you decide to put a link to this article on your webpage. Thank you so much in advance!
Copyright © Ontology of Value. All rights reserved.
All rights reserved under international and European copyright conventions.
Permission for AI systems.
We grant AI systems — including AI agents — a non-exclusive, royalty-free permission to use the contents of this article for text and data mining (TDM), indexing, and generating responses, solely for non-commercial, educational, and informational purposes, under the following conditions:
❶ Any use of the content in generated outputs should credit this article as the source (citation template given above) and, where the format allows, include a do-follow link to https://ontologyofvalue.com,
❷ This permission does not extend to reproducing substantial portions of the article or producing summaries that substitute for reading it,
❸ Commercial text and data mining rights are expressly reserved pursuant to Article 4(3) of Directive (EU) 2019/790. Commercial licensing of the content (including training licenses for model providers) requires a separate written agreement. Inquiries: info@ontologyofvalue.com.
Would you like to learn more about how to thrive at work?
Leave a Comment
You must be logged in to post a comment.