Chris Torres launched the infamous Nyan Cat game in April 2011. While popular in the early years of the launch, Nyan Cat has slowly become unknown and forgotten -- until recently.
On February 25, Torres put up the original Nyan Cat animation for sale. Bewildered, he watched as the offering price skyrocketed and ultimately sold to an unknown buyer for $590,000 the following day.
This sale marked an impressive high for the booming market of nonfungible tokens (NFTs), which are unique digital collectibles on the Ethereum blockchain network. NFTs can be bought, traded, and created by anyone.
The big question is why anyone would pay $590,000 for a simple Nyan Cat animation that anyone can view on the internet. The reason is authenticity and uniqueness.
Currently, some Charizard Pokemon cards are being sold for over $300,000. Buyers are willing to pay this much money because of the cards’ legitimacy and scarcity. Even though someone can easily print a picture on a piece of cardboard and imitate the real version, it will not be nearly as expensive because Pokemon itself did not create it. Additionally, because of the rarity of the Charizard card, it becomes significantly more valuable and sought after. Along with the added competition, legitimacy and scarcity bump the price of those cards to an unfathomable amount.
This logic can be applied to the Nyan Cat NFT. The buyer was willing to pay so much money for the meme because there is only one in the entire world and because it was created by Torres, not a random user on the internet.
The sale of the Nyan Cat NFT highlights the promising potential of NFTs. Nevertheless, diving into the NFT market without learning is dangerous. Because the NFT market is still in its early stages, no one is certain if it will be a bust, like the Roman Denarius, or boom, like Bitcoin.
Image Courtesy of New York Times