What is NFT?
A non-fungible token (NFT) is a unique digital asset that represents ownership of real-world items. It can be used to represent items such as photos, videos, audio, and other types of digital files.
NFTs use the same blockchain technology that powers cryptocurrencies, but they cannot be classified as a currency.
The above definition might still be on the confusing side,so lets break it a little more
The “non-fungible-token” is probably one of the most searched phrase on google right now.
“Fungible simply means Interchangeable” , two coconuts are fungible, meaning they are equal to each other in parts and value. Now imagine having 2coins, they are fungible. If you cut one into a square, that one becomes non-fungible.
Its pretty much understandable now that an NFT refers to two things, the token and the object that it is assigned to.
Types of NFTs?
Non fungible tokens are capable of displaying the true provenance of an asset with the functionalities of blockchain .NFTs helps in holding, limiting, or denying access to rights of an individual on their assets, thereby ensuring exclusivity. Meaning whatever is yours is yours.
Artwork
Collectibles
Event tickets
Gaming
Music and media
Virtual items e.t.c
What is minting an NFT?
Minting is the process of turning digital art into a part of the Ethereum blockchain as a public ledger.
NFTs ensure representation for your digital artwork, it also ensures that the artwork can be flexibly traded or purchased in the market. It takes few days to mint an Nft.
NFT vs Cryptocurrency
It’s important to outline the difference between cryptocurrency and non-fungible tokens. Although both Nft and cryptocurrerncy are based on blockchain technology, the major difference can help us to understand how NFTs work.
The key difference goes back to cryptocurrency being fungible. You can exchange a Bitcoin for another Bitcoin, for example. This cannot be done for an NFT.
A non-fungible token is tied to one particular digital asset and cannot be replaced.
Are NFTs Valuable?
The value of an NFt comes from the collectibility of that asset, also the future potential sale value would determine how far the bids can go . NFTs can be sold and traded.
In February 2021, digital artist Beeple sold an Nft for their Everydays – The First 5000 Days artwork for $69.3 million through Christie’s auction house.
Jack Dorsey, the founder of Twitter, he sold it for for $2.9 million
I guess we now know how valuable NFTs can be..
Advantages of NFT
- NFTs allow creators to make money directly from their work.
- Easily Transferable,NFTs are purchased and sold on unique markets.
- Maintain Ownership Rights: no buyer can change the data later, as a creator you can maintain ownership rights.
- Its safe and secured.
