It's easy to get lost in the JPEG-mania of the NFT space and gloss over the real powers of the technology and why it is a big deal.

A significant force that drives the wave of web3 is the concept of ownership. Going from working for a salary to contributing for an ownership stake is a powerful mental model.

NFTs are about ownership, too. It's technology to solve digital ownership in a provable way.

The technology will have a massive impact on many things, but there are four primary use cases that I think we'll see play out over time.

Understanding them is important to know why NFTs are a big deal:

• Powering the creator economy
• Owning digital assets
• Create leverage from connecting ownership across the physical and digital world
• Handling ownership in the physical world more efficiently

Let’s get to it.

Powering the creator economy

NFTs are already creating more efficient ways for creators to transact and interact with consumers (or fans).

This will continue to play out, at the expense of incumbent middlemen like record labels and book publishers.

The technology also enables previously impossible or near-impossible features, like establishing a revenue stream to creators from the royalties they can collect on secondary sales.

NFTs also give creators a way to verify ownership and engage directly with their truest fans.

Owning digital assets

Creator economy plus digital asset ownership is the cocktail we've got going right now. Artists and creators (primarily of visual art) are selling, and consumers are collecting.
Owning digital assets will span broader than that, though; Especially as the vision of the metaverse plays out over time and our digital identities become more important to us.

Digital assets will be stores of value and provide social capital and utility for us in the digital world.

The key unlock with NFTs is that they enable actual ownership: the digital assets you own are yours, and you can bring them in and out of platforms, products, and digital experiences to your liking.

Digital asset ownership is a core component of the metaverse vision.

Connecting the physical and digital world

Connecting what we do and what we have in the physical world with what we do and have in the digital world will become more important.

First, when we end up with a tricked-out metaverse, we're still going to a big portion of our lives in the physical world (at least, I hope we do).

Still, it makes complete sense that the identities and assets we own across the digital and physical worlds affect each other.

This will also be the first adapter for physical-world companies and brands to connect with and leverage the potential of web3.

The crossover will work both ways:

• Something you own or did in the physical world affects your digital world
• Something you own or did in the digital world will unlock something in the physical world

We've already seen the latter example play out during the big NFT conference in New York when Bored Ape Yacht Club-owners got access to parties, including a free The Strokes/Lil' Baby concert.

It's going to work the other way around, too. It takes more time because it depends on the companies still trying to figure out web3, NFTs, and blockchain.

We could see things like

• Going to see a movie during opening weekend unlocking virtual merch
• Running a marathon gives you access to an exclusive, global runners club
• Buying a Tesla and getting airdropped a limited edition and tradeable doodle by Elon Musk

Handling ownership in the physical world more efficiently

NFTs enable verifiable proofs of ownership without depending on trusted third parties.
We will be able to handle ownership, transact and transfer ownership of physical items better than we currently do.

It will affect property deeds, capital goods, and items where provenance is important.
Transferring this idea from private consumption to business use cases will play a huge role in supply chain logistics and sustainability projects in the future.

Some of these use cases are already at work; some are on the cusp of going mainstream, while others will take some time.

They are also consecutive in that the current phase will prove the feasibility and potential of the next.