In December, Fidelity Investments filed trademark applications for product offerings related to NFT and the metaverse. Offering financial advice within the Metaverse could be the first step towards offering NFT investment products. NFT coins are primarily seen as collectible art. But they are also crypto tokens to trade and sell on various platforms in a few unique ways. Crypto expert Dominic Basulto delves into NFT coins from a different angle.
NFT coins and metaverse-based investment products for retirement
Keep an eye on Fidelity. Because it is possible that new investment products based on NFT coins and metaverse will arrive in 2023. When it comes to saving money for retirement, Fidelity Investments is likely poised to drastically turn the market upside down. On December 21, Fidelity submitted an application for a new NFT market. It has also filed a number of trademark applications related to NFTs and the metaverse, including an application to submit financial advice within the metaverse.
In other words, Fidelity is preparing to make NFTs part of the path you save for retirement. The NFT market collapsed this year. Also, popular metaverse cryptos like Decentraland and The Sandbox have dropped more than 90% in 2022. Given this situation, this will probably sound crazy to many investors. We don’t yet know exactly what Fidelity will do with these trademark applications. However, we can speculate about possible future use cases.
NFT coins as collectible art
cryptocoin.com As you know from , the most obvious use case is to buy NFTs as collectible art. One reason NFTs were in the first place was the assumption that you could buy an expensive asset and turn it into a much higher price in the future. The expectation, of course, is that the digital art of the top artist or creator will be appreciated over time. 10, 20 or 30 years from now, you may be holding the digital equivalent of Picasso or Van Gogh.
While it’s hard to imagine keeping a Bored Ape or CryptoPunk in your digital wallet for ten years or more, there is a clear scenario where digital art could be part of your long-term retirement portfolio. Of course, the only caveat here is that the IRS has made it clear that the inclusion of collectibles items in individual IRAs and 401(K) plans is prohibited.
NFT coins as staking assets
Crypto staking has become an increasingly popular form of passive income for its investors. It is possible to earn between 1% and 10% of your crypto assets on any crypto exchange. Staking NFTs works similarly. Only you use an NFT as the underlying asset, not a cryptocurrency. This option may become more popular over time, especially since many assets in the metaverse are actually NFTs. When you are not actively using these NFTs, you may want to convert them into earning assets.
Conceptually, this option is much more difficult to understand. But think about it this way: You agree to lend your precious NFT for an agreed period of time and earn rewards during that time. At the end of this period, they will return your NFT to you. In the real world, wealthy art collectors lend valuable artworks to museums and galleries for exhibitions. So why not in the crypto world? For example, in early December, ApeCoin (APE) introduced new staking pools for Bored Ape NFT holders.
NFTs as an entirely new asset class for a portfolio
Things get really interesting when you start seeing NFTs as an entirely new form of asset class. Typically referred to as ‘digital assets’ or ‘tokenized assets’, this class includes virtually all crypto-related investments except the cryptocurrency itself. The long-term trend is towards the tokenization of the world. It also implies a digital representation of real-world physical assets.
Once you tokenize an asset, it is possible to buy, sell, share and transfer almost anywhere. And best of all, it’s possible to split it into pieces, just like buying a single Bitcoin satoshi. For example, you want to invest in really expensive watches, but you don’t have the money to buy a Rolex. Well, now you have the possibility to buy a small portion of a single share through a crypto token traded on a decentralized exchange.
Where does loyalty fit into the picture?
In a basic scenario, Fidelity will simply provide investment advice on these different options. Maybe you can spend some time in the metaverse with a digital avatar and discuss your retirement future in a digital office built on digital land. We have the opportunity to stop by for a quick 30-minute retirement check on your favorite metaverse. In April, Fidelity set up shop in the metaverse through a multi-story digital building complete with a dance floor and rooftop garden. So that’s definitely within the range of possibilities.
In a more advanced scenario, Fidelity will begin to provide more and more ways to invest in digital assets such as NFTs. For example, in December, Fidelity launched its new crypto platform for retail investors. Thus, it allowed ordinary people to buy and sell cryptocurrencies in a secure, zero-fee environment created by Fidelity. Imagine this platform turned into a new platform where you can buy and sell NFTs in addition to cryptos. Frankly, we don’t know what Fidelity will do. So this is all speculative. But certainly, it’s fascinating that Fidelity has taken such an innovative approach. What if NFT coins could actually help you save for retirement?