Did you know that by simply owning an NFT you could be making passive income?

And did you know NFT technology is bound to "leak" into real life assets?

So, yes, those "avatars and cat jpegs" might actually earn you a considerable amount of money when used right.

So, first things first: what is an NFT?

To put it in simple terms, NFT stands for Non-Fungible Token, which is cheeky way of saying that it is a completely unique token that is unable to be duplicated.

Now, the version of NFTs which people are familiar with are jpegs, however, it is important to make the distinction that the NFT itself isn’t actually the picture you are looking at, rather a token ID on the blockchain which is paired with the image URL and therefore represents the image you are looking at.

This means that since there are no image data on the blockchain, what the token is doing is simply pointing to the image file, meaning that it could also point to several other different things such as domain names, the deed to a house, and so forth, which is why they are extremely versatile and likely to revolutionize the very concept of ownership.

And where exactly does the passive income fit in?

While some take an active stance and speculate wildly on NFTs, passive income is in fact possible too.

Much like content can be monetized online, content makers can also make NFTs of their works and sell them with the promise that whoever will buy them will get a part of their advertising revenue.

The core idea of a passive income in NFTs is the notion that having a digital representation of physical asset actually adds value.

Let’s take a band, for example.

They create a new hit song and monetize it on a popular streaming platform, meaning that they will earn a percentage every time someone buys it or streams it (via ads).

If the artists turn that song into an NFT and sell part of those monetary rights for a period of time (or in perpetuity), the owner of the NFT would also receive his or her cut.

This allows for the artists’ audience and fans to engage with the band, to have their skin in the game by investing in their project, and, more importantly, to earn rewards along the way.

Accordingly, this logic makes it so that the concept of NFT monetization can be extrapolated into other areas such as videos, social influencing, games, and so forth, connecting creators with their audiences in a unique and unprecedented way.

This means that investors can back the creators’ projects and earn their fair share passively.

NFTs in real life?

NFTs can go way beyond the digital rights industry as they present themselves as a clever solution for the real estate industry.

The reasoning behind having NFTs in real estate is simple: whole buildings and apartment complexes can in theory be divided into several NFTs entitling their respective owners with a percentage of ownership of said building.

This could allow for massive investing opportunities to those who aren’t able to afford a house and/or might not have access to credit, to make their way into the real estate business by buying fractional pieces of property.

Wrapping up

NFTs “leakage” into the real world is inevitable and even for those who are short on capital, there is ample opportunity for investment and a consistent, long-term stream of revenue.

So, while many dismiss it or think of it as some kind of scheme, we highly encourage you to take your time and get to know this incredible piece of tech.

Sometimes you just got to know how to play your "cards" right.