Phantasma Blockchain: Paving the Way for Digital Ownership
What if we told you that you could own a fraction of a rental property or a small business, without taking out a loan that comes with high interest rates and the risk of default, and collect passive income and potentially profit from its appreciation in value, all through the power of blockchain technology? This may sound too good to be true, but with the emergence of non-fungible tokens (NFTs) and fractionalized ownership, it could become possible and the Phantasma blockchain is paving the way for a more secure, transparent, and democratic digital ownership revolution.
The digital age has ushered in a new era of ownership with the emergence of decentralized technologies like non-fungible tokens (NFTs) and the potential for fractionalized ownership. These innovative technologies are disrupting industries and creating exciting opportunities for developers, businesses, and investors in the Web3 space and the Phantasma blockchain will play its role in solving the challenges ahead.
NFTs are unique digital assets that use blockchain technology to verify ownership. They have already disrupted industries ranging from art to sports memorabilia. For example, digital artist Beeple sold an NFT of his artwork for a record-breaking $69 million at a Christie’s auction, while NBA Top Shot has sold NFTs of basketball highlights for millions of dollars.
The potential for NFTs to represent ownership of real-world assets such as property or businesses could be on the horizon. For instance, an NFT could represent ownership of a rental property, and investors could purchase fractionalized ownership in the property, allowing them to collect rental income and potentially profit from any appreciation in value. Similarly, an NFT could represent ownership of a small business, allowing investors to share in the profits and potentially influence business decisions.
Phantasma’s programmable smartNFTs can incorporate customizable conditions and rules that govern the fractional ownership of assets. This flexibility allows for more tailored solutions to meet the varying requirements of different assets and investors. Additionally, Phantasma’s focus on interoperability ensures that its smartNFTs can interact with other blockchains, thereby facilitating a more seamless and connected experience for users involved in fractionalized ownership transactions.
Fractionalized ownership takes NFTs a step further by allowing multiple investors to own a single asset, providing creators with easier access to funding and unlocking new investment opportunities for smaller investors whilst increasing liquidity in the market as assets can be bought and sold in smaller portions.
However, scalability and interoperability remain significant challenges for NFTs and fractionalized ownership but the Phantasma blockchain is designed to handle high transaction volumes and is interoperable with other blockchain networks, making it well-suited to address these challenges.
As NFTs and fractionalized ownership continue to evolve in the Web3 space, businesses and developers have an opportunity to create a more equitable and accessible digital economy. With the Phantasma blockchain paving the way for secure, transparent, and democratic digital ownership, the future looks bright for those looking to embrace these innovative technologies.
However, representing ownership of property or entire businesses will not be without its challenges with both legal and regulatory implications, and can raise questions around property rights and how ownership of such assets can be legally transferred through NFTs. Additionally, if NFTs representing real-world assets are used as collateral for loans or other financial transactions, there could be questions around who has the legal right to foreclose on the asset in case of default.
Another legal issue that may arise is tax implications. If an NFT represents ownership of a real-world asset, it could trigger tax liabilities similar to those associated with physical ownership of the asset. However, it is still unclear how tax authorities in different countries will treat ownership of assets through NFTs and fractionalized ownership structures.
Fractionalized ownership may also require new regulatory frameworks to ensure that investors are protected. Traditional investment structures like stocks or bonds are subject to a range of regulations that protect investors from fraud or other abuses. As fractionalized ownership becomes more popular, developers, businesses, and regulatory authorities will need to work together to create new frameworks and industry standards to ensure that investors in these structures have similar protections.
There may also be legal implications around intellectual property rights. If a creator sells an NFT representing their artwork or music, they may still retain intellectual property rights to the underlying asset. This raises questions around how the NFT owner can use or monetize the asset without infringing on the creator’s intellectual property rights.
The future of digital assets and fractionalized ownership in Web3 is both exciting and complex and as these technologies become more widespread, businesses and developers will need to navigate these legal and regulatory implications to ensure that their use of these technologies is compliant and legally defensible and seeking legal advice is highly recommended.
With the potential to revolutionize ownership and investment, the future of NFTs, Phantasma smartNFTs, and fractionalized ownership in Web3 is certainly one to watch in the coming years although for now it may be confined to the world of NFTart through sites like our exchange partner GateIO’s GateNFT marketplace which allows for fractional ownership: