These days my email is full of newsletters talking about NFT arts/paintings and then again Jack Dorsey’s tweet being sold as an NFT was quite a news on the Internet, wasn’t it? In fact, the term has been one of the most buzzed terms in 2021. If you are wondering, what is NFT? How is NFT created? How does NFT Work? How do you Buy NFT? What are NFTs Used For?And what’s the hullabaloo surrounding it, you have come at the right place as we tell you all about NFTs in this article, starting from scratch.
What is NFT? What does NFT Stand For?
NFT stands for Non-fungible Token. Still, it doesn’t make any sense, does it? Well, non-fungible means it is unique and cannot be replicated. In simple terms, NFT or non-fungible tokens are digital asset (one of a kind) that represents real world objects like music, arts, games, videos etc. and have unique identifying codes. These tokens represent ownership of unique items and at the same time help in tokenising things including real estate.
This is the reason why buyers are spending millions because NFT allows the purchaser to own the original item. With built-in authentication, NFT gives the owner the proof of ownership as well as digital bragging rights. This is precisely why it NFTs are not interchangeable with other items.
How NFT is Similar to Cryptocurrency? And How NFT is Different from Cryptocurrency?
The non-fungible tokens are built by using the same kind of programming that is used in cryptocurrency like Ethereum and/or Bitcoin. However, this is the only similarity between NFT and Cryptocurrency, nothing else.
Cryptocurrencies and physical money unlike NFTs are fungible i.e., they can be exchanged or traded for one another. In addition, they are of same value – one rupee is always equal to another one rupee and 1 bitcoin is always equal to another 1 bitcoin. NFTs are different. No two NFTs can be same as each has a digital signature. Besides, they cannot be swapped for equivalent value (for instance 2 50s make 100) This is the reason why they are non-fungible meaning they cannot be exchanged for another. However, the values can increase or decrease in the future going by the circumstances.
How is NFT created? How Does NFTs Work?
NFT is created or made from digital items that embodies intangible as well as tangible objects including Arts, Videos, Music, Sports Highlights, GIFs, Collectibles, Designer items, Video game Skins, Memes and even tweets. Like we said earlier Twitter’s co-founder Jack sold his first tweet as an NFT for a whopping $2.9 million.
So, unlike a physical item you get a digital file here along with exclusive ownership rights. So, only 1 owner can have a particular NFT at a time. Now if you are wondering where these NFTs exists. Let me tell you they exist on blockchain ledgers and are typically held on the Ethereum blockchain and Solana.
How Can One Buy NFTs?
You can buy NFTs with native currency ETH (Ether) and SOL which you can acquire on most exchanges including Binance, Coinbase, Kraken and FTX. NFTs are easily verifiable and you can easily trace the owner of the creator of the NFTs that you plan to buy. Also, if you are a creator, you earn royalties every time it is sold.
Where to Buy NFTs?
You can Buy NFTs at the following destinations –
- GROW HOUSE
- Axie Infinity
- NBA Top Shot
- Makers Place
- The Sandbox
- Nifty Gateway
What are NFTs Used For?
Content creators, artists and celebrities no more have to look for galleries and auction house to sell their work, piece of art and/or memories. They can simply sell to the consumer as an NFT. Interestingly, NBA Top Shot could fetch more than $500 million in March, 2021 and a GIF of a cat ‘Nyan Cat’ was sold for nearly $600,000 in Feb 2021. American Digital artist and animator Beeple (Mike Winklemann) who didn’t even sell for $100 have been selling and reselling his works for millions.
Even celebs like Lindsay Lohan and Snoop Dogg are getting into the NFT bandwagon. NFTs are certainly here to stay. No wonder, it was one amongst the most searched terms on Google Search Engine in 2021.
Now that you know What is NFT, it’s features and how does it work – Will you invest in NFTs? Let us know in the comment section.