In this video, we’ll explain how Enjin coin works, what non-fungible tokens or NFTs are, and where the price of Enjin coin is likely to go in 2021. The price of Enjin coin has seen exponential growth over the last week on the back of the NFT craze as well as its recent listings on various cryptocurrency exchanges including crypto.com. Will the price of Enjin coin continue to chug along or has it run out of steam? This video is brought to you by I dream of money, the channel bringing you videos about business, economics and money. Help us reach 1000 subscribers by clicking on the like and subscribe buttons so you never miss out on a video to help you become a better investor.
Enjin coin is an Ethereum based coin designed to be a cryptocurrency for the gaming community. The issue Enjin coin is attempting to solve is to attach real world value to in game items and to decentralise control of them so that players are not left to the whims of game developers and how they monetise their games. This comes off the back of game monetisation scandals such as the Star Wars game Battlefront II where there was a lot of backlash against EA for what was seen as predatory pricing. Enjin coin is intended to be a multiverse coin to be used across any participating games. Think of Enjin coin like a resource. In game items can be backed by Enjin coins which have value outside of the game.
So for example you could attach 1 Enjin coin to an armour for a game. Users can then trade these virtual assets on the Enjin marketplace, or if they can’t find a buyer for the item they can convert it back to Enjin coins and trade the coins instead. Game developers can ensure they continue to be paid each time a virtual asset is traded by retaining a percentage of the sale proceeds. This potentially provides game developers with ongoing revenue, especially as those virtual assets increase in value. Also only 1 billion Enjin tokens will ever be created, preserving the value of the coins. So how does this relate to NFTs? An item is fungible where it is easily able to be exchanged or replaced for another item. Most cryptocurrencies are fungible. Non-fungible tokens or NFTs are exactly as they are described – non-fungible.
NFTs are therefore unique and allow virtual items to be authenticated, reducing fraud and improving exchangeability. In terms of how this relates to Enjin coin, the in game items created using Enjin coin are NFTs, but Enjin coin itself is a fungible cryptocurrency. NFT's use case in artwork or virtual collectibles such as images and animations is where the real action currently is. It has been reported for example that musician Grimes sold US$6 million of NFT animations in 20 minutes.
Other popular examples of NFT use cases include CryptoKitties which allows the collection and breeding of virtual cats and CryptoPunks which made headlines in January 2021 when the “Alien” NFT was sold for 605 Ethereum equivalent to $760,000 at the time. So how does this impact the price of Enjin coin? Most of the current NFT use cases don't use Enjin coin but rather operate off the Ethereum smart contract network. So it would appear that the price of Enjin coin is being swept along in the NFT craze. That being said, I think there is a bright future for Enjin coin for a few reasons. Firstly, virtual worlds are here to stay and people are increasingly attaching real value to virtual items. The ideas behind Enjin coin are aligned with where the world is heading and there will be fans of the coin purely due to its purpose of giving power back to the gamers. Secondly, the Enjin wallet is user friendly and what’s more the team behind Enjin coin are continuously improving the interfaces and technology.
Enjin coin actually started as an ERC-20 token however the Enjin team developed and switched the token to ERC-1155, which allows a single smart contract to represent any number of fungible and non-fungible token types. This was a step up from the ERC-20 and ERC-721 which require a separate contract to be deployed for each token type or collection. What this then enables is speed. Enjin is now developing the JumpNet and Efinity scaling solutions which if developed as planned will allow nearly infinite volumes of transactions between millions of players and the game server — at high speeds and nearly no costs solving a key problem with the Ethereum network that many so called Ethereum killers like Cardano, Avalanche and Polkadot are trying to solve – high gas fees.
Thirdly Enjin coin will see real value if it has widespread adoption. That will largely depend on game developers signing up to use Enjin coin in their games. Enjin has formed many partnerships over the years with key industry figures including Samsung, Microsoft, Ubisoft and Unity to introduce blockchain into games. It has definitely positioned itself as the gaming cryptocurrency to beat. Even if there is more competition, Enjin coin does not necessarily need to stay in the gaming space as its functionality could be used in many other types of applications involving NFTs. As such my price prediction is that Enjin coin continues to go up in price and I wouldn’t be surprised if its price doubles again to reach over US$2, if not more.
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