The company is aiming to “democratise” the investment market for non-fungible tokens, digital entities that allow unique items, such as works of art, to be registered and traded on a blockchain
() is not one for hanging around, with the company having quickly established itself to capitalise on, as the name suggests, non-fungible tokens (NFTs), the latest innovation to come out of the cryptocurrency and blockchain industry.
NFTs are tokens that allow unique items, such as works of art, to be registered and traded on a blockchain. Existing NFTs, including the first-ever Tweet, have already been sold at auction for eye-watering amounts running into the tens of millions of dollars.
However, for most mainstream investors, even wrapping their heads around the concept of NFTs may prove difficult, let alone figuring out how to invest in them.
It is at the crossover between ordinary investors and the new NFT market that the company aims to position itself.
According to Johnathan Bixby, the company’s executive chairman, “everyone is talking about NFTs, but no one is actually doing it”. He told Proactive a similar trend existed around Bitcoin investments until recently when an explosion in the crypto’s value sent cash flooding into the market.
He said that NFT Investments is designed to accomplish with NFTs what one of his previous ventures, London-listed crypto miner () did for crypto mining, in such that it will offer investors and more secure and regulated proxy to gain exposure to this new market.
“NFTs are quite technical…so we want to be a proxy for the NFT market. We allow investors to take their fiat money and put it into a regulated, audited company. The problem is there is currently too much friction in this market and if we can take some of that away more people will be able to get into the market and democratise it, allowing more people to win.”
“Anyone can invest into our stock and play the NFT market. It’s as simple as that”, he said.
The company is already seeing the fruits of its approach with investors, with its initial public offering (IPO) on the Aquis Exchange in mid-April more than trebling its original £10mln fundraising target to rake in £35mln ahead of the float.
In terms of investment strategy, Bixby said that the firm is pursuing a portfolio approach targeting three different areas of the sector to achieve returns. The first area is NFTs themselves, where the company is aiming to aggressively pursue creators and digital artists that have large social media followings which in turn are likely to increase the value of NFTs on the market. NFT Investments will take a data-driven investment approach that will see the company home in on up-and-coming talent in the digital art world and purchase NTFs created by this group. There is a strong correlation between the social following of a digital artist and the value of their NFTs.
The second avenue is the infrastructure and frameworks needed to create and maintain NFTs, notably blockchains and their related tokens, NFT galleries and real-world assets that are critical for the sector to function such as computer server farms. Approximately a third of NFT Investments’ funds will be invested in the infrastructure underpinning NFTs, and as with Argo Blockchain, NFT Investments’ efforts will be centred around building sustainable and efficient means of powering blockchain technology.
The third element is the monetisation of creators, with the company aiming to partner up with celebrities and other artisans in the long term to create and profit off new NFTs through royalty deals. Human nature will drive interest
Looking to the NFT market itself, Bixby said that while the products themselves may seem complex, the reason for their popularity…