Traditionalist investors who dismiss NFTs — the new digital asset class taking the art, fashion, music, and sports world by storm — are fooling themselves if they believe they are a passing fad.

NFTs are one-off digital assets that are verified through blockchain technology, giving buyers certificates of authenticity and ownership. They produce unique, non-interchangeable digital tokens, and can be bought and sold like any other assets but they do not have a physical form.

A growing number of globally established brands are becoming increasingly involved in the NFT market including the National Basketball Association (NBA) and Sotheby’s.

The latter, the traditional auction house, held a three-day auction of NFTs by an anonymous artist two weeks ago. Meanwhile, Christie’s last month sold “Everydays — The First 5000 Days,” a digital artwork in JPEG form by an artist known as Beeple, for $69.3 million — which is the third most expensive artwork ever sold by a living artist.

The virtual hype about NFTs is very real.

They may be a novelty at the moment, but it makes sense that with the blistering pace of the digitalisation of our world, digital assets will become increasingly valuable.

Demographics are on the side of NFTs too. Millennials, and Gen Z especially, have digital lives and it’s natural to want to take digital representations of luxury brands, music and art into these worlds — and now they can.”

The Great Wealth Transfer is another factor. According to some estimates, $68 trillion in wealth is to be passed down from the baby boomers — the wealthiest generation ever - to their children and other heirs over the next couple of decades.

Another key reason why NFTs are here to stay is that they are positively changing business models, especially in the creative industries.

Artists and musicians for example can provide enhanced virtual experiences for collectors and buyers, they can prove if their works are counterfeited, and they can include criteria to get royalties every time their works are re-sold in the future.

The messaging also comes with a warning.

NFTs are the hottest new digital asset — but investors need to exercise extreme caution. This market is very young.

That said, those who dismiss NFTs outright would probably have been the people who previously dismissed online retailers such as Amazon and digital currencies such as Bitcoin.

Nigel Green is founder and CEO of deVere Group. One of the world's largest independent financial advisory organizations, de Vere does business in 100 countries and has more than $12 billion under advisement.