Feb 18
The science behind NFT’s
Non-fungible tokens are also known as NFT’s. If you don’t know about them, probably you are among those pupils who in the 21st century live under a rock. One might be thinking about what NFTs are and their role in making a person retire in their 20’s.
According to the Statista research department, between the period of May 2020 and November 2021, the online platform of NFT’s launched 6,623 new NFT’s. Those NFT’s were the artwork of 418 artists who did the sale on Nifty Gateway of roughly 408.8 million US dollars at the same time. That’s the sale only in the artwork niche that includes only a specific period.
That’s not all, turning our needle towards the e-sport industry. According to a survey of e-sport industry professionals in October 2021, 80% agreed that there would be an increase in the prevalence of NFT’s in e-sport industry in the next 12 months.
Let’s jump into the secrets of the NFT’s, how they work and how they can give you the financial freedom you want?
What are NFT’s (non-fungible tokens)?
NFT’s are the digital assets that represent real-world objects like art, music, in-game items, and videos. They are sold and bought online, in exchange for cryptocurrency, they are encoded with the same technology as used in different cryptocurrencies.
For instance, Mike Winklemann, as known as “Beeple”, one of the most famous digital drawing artists created one of the most famous NFT of the moment: “EVERYDAY: The First 5000 Days”, which has been sold at the record-breaking of 69.3 million dollars.
A valid question might come into the mind of an ordinary individual “anyone can see the entire collage of the images and can take a screenshot and download the images. Why would someone spend millions on such digital images to own it?”
That’s where the twist comes and that’s the beauty of an NFT. It allows the buyer to own the full ownership of an item. That’s not all, it has a built-in authentication that proves the ownership of the buyer.
What might be the possible difference between the NFT’s and the cryptocurrencies?
NFT stands for non-fungible token. It is programmed under the same technology as cryptocurrencies such as Bitcoin and Ethereum. However, this is the point where the similarity ends.
Let’s make it clear to get a clear version of the difference between a cryptocurrency and an NFT. Physical money and cryptocurrencies are “fungible”, they can be traded for one another. To make it more concise, one dollar has an equal worth of another dollar and one Bitcoin is equal to another Bitcoin.
Unlike cryptocurrency, NFT is different because of its non-fungibility factor. Due to the reason that each NFT consists of a unique signature making it non-exchangeable with the other NFT, even if the equivalency is there between the two.
One most interesting fact about the NFT’s are that they are extensible; one can combine one NFT with the other one to bring the third form. In simple words, one can do proper breeding on NFT’s.
How does an NFT work?
NFT’s exist on Blockchain, a distributed public ledger that records transactions. Specifically, NFT’s exist on Ethereum Blockchain, although other Blockchains support them as well. Many of the NFT’s cannot be purchased if you don’t have the Ethereum currency in your crypto-wallet.
Both tangible and intangible that represent digital assets creates an NFT, including:
- Art
- GIFs
- Music
- Collectables
- Designer sneakers
- Videos and sports highlights
You can even sell your tweets if you are an influencer. Just like Jack Dorsey, co-founder of Twitter sold his first-ever tweet for more than 2.9 million dollars.
Furthermore, NFT’s are just like physical collector items, only digital. So, instead of getting the original painting and hanging it in your room, you can get a digital file. That’s not all, you will also get exclusive ownership rights. Its unique data makes it easy for you to verify your ownership and transfer of the tokens with another party in terms of selling the NFT.
You can also store specific data inside the NFT. however, many artists sign their NFT’s with their unique signature in an NFT metadata.
What are NFT’s used for?
NFT’s can be used for different purposes. One of the main ones is that it is the main source of creating wealth for the artists and content creators where they can monetize their wares. Artists won’t have to rely on galleries or auction houses to sell their work.
Along with that, they don’t have to pay a specific percentage of the sale to the auction houses or galleries.
Instead, they can sell their artwork directly to the consumer by converting their art into NFT.
They can also integrate royalties whenever their artwork will be sold to the new owners. This would lead to the securing of a specific percentage of sales for the artist. This is a unique feature of an NFT because artists don’t receive a commission on their artwork after its first sold.
These NFT’s are not only restricted to art, but one can also sell GIF’s, artefacts and many other items as NFT’s. Celebrities like Snoop Dogg and Lindsey Lohan are also jumping into NFT’s by releasing their unique memories, artwork and moments as scrutinised NFT’s
How to buy NFT’s?
If you are keen to have your collection of NFT’s, you need to some key points in mind:
Firstly, you need to acquire a digital wallet that allows storing NFT’s and cryptocurrencies. Secondly, you need to buy some cryptocurrency, like ether, keeping in mind what cryptocurrencies are required by the NFT provider in terms of transactions for NFT.
You can buy crypto by using your credit card utilising platforms like PayPal, Robinhood etc. Then you can transfer crypto to your choice of wallet.
Most exchange platforms set a percentage for themselves in a transaction of cryptocurrency.
Popular marketplaces for buying NFT’s
- Opensea.io
- Rarible
- Foundation
The mentioned above platforms are among the most famous platforms from where you can buy NFT’s
Conclusion:
Non-fungible tokens are the best form of investment to get you to retire in your 20’s and sell your art at a price that you desire. They are easy to purchase and sold on different platforms. Their transaction process is very much reliable because of their presence on the blockchain, a public ledger, and the ownership rights will be completely transferred to the owner without any delay.
