Bitcoin bull and popular crypto influencer Lark Davis has pointed to a new trend that could ignite massive demand for certain digital assets.
Speaking in a recent YouTube video, Davis called non-fungible tokens (NFTs) the next major trend for cryptocurrency to emerge from the decentralized finance (DeFi) sector.
He explained the new product,
A fungible item is one that can be exchanged for any similar item. For example, a dollar bill is fungible because it can be exchanged for any other dollar and maintain the same value…If we move this idea into the blockchain setting, an NFT is thus a one-of-a-kind token, a certificate of digital authenticity verifiable on chain.
The crypto influencer noted that NFTs were gaining popularity while having the potential for massive growth. He called it a matter of time before the investment community took notice of the emerging industry.
He continued, saying that NFTs would expand beyond their current usage for digital art and gaming. Lark argued that tokens could be used for royalties, insurance and other sectors that require the creation of a loan, including DeFi.
He said,
Perhaps the most financially lucrative use case for NFTs is going to be plugging into DeFi. Maker DAO is already working on bringing music royalties and shipping invoices into their platform.
Lark pointed to the DeFi protocol Persistence as an example of a NFT project for investors to keep an eye on.
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