Markets can’t operate without clear property rights: Before someone can buy a good it has to be clear who has the right to sell it, and once someone does buy you need to be able to transfer ownership from the seller to the buyer. NFTs make it clear who the owner of a good is and in doing so they make it possible to build markets around new types of transactions.

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Benefits of NFTs include:
- market design uses
- resolves ownership issues
- clear ownership history
- easily transferrable
- expandable in purpose over time

Benefits of NFTs

How nfts create value. Harvard Business Review. (2021, November 19). Retrieved April 7, 2022, from https://hbr.org/2021/11/how-nfts-create-value 

How NFTs Create Value

Market Design Uses of NFTs

Before NFTs, there was no way to separate the owner of digital media from users who downloaded the content. Now, with NFTs, this problem is solved by giving parties something they can agree on, representing ownership.

NFTs Resolving Ownership Issues

NFTs are stored on public-facing digital ledgers called blockchains, which means it’s possible to prove who owns a given NFT at any moment in time and trace the history of prior ownership.

Clear Ownership History

It’s easy to transfer NFTs from one person to another, and it’s very hard to counterfeit them. Because NFT ownership is easy to certify and transfer, they can be used to create markets in a variety of different goods.

NFT Transferrability

NFTs are stored on blockchains, and since blockchains are programmable, it’s possible to endow NFTs with features that enable them to expand their purpose over time or even to provide direct utility to their holders. In other words, NFTs can do things, or let their owners do things, in both digital spaces and the physical world.

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