There's nothing like an explosion of blockchain messages that makes you think, "Um ... what's going on here?" That's the feeling I get when I read Grimes, which makes millions of dollars for the NFT or the part of Nyan Cat that sells as a whole.
In a year when NFTs exploded in popularity, the situation became more complicated. Monkey pictures have sold tens of millions of dollars, there is an endless supply of headlines about million hacks on NFT projects, and corporate cash grabs are getting worse.
All this news may make you think: but what is the NFT?
After countless hours of research and discussion (mostly against my will), I think I know. I also thought I was going to cry.
Okay, let's start with the basics. Unmistakable tokens (NFTs) seem to be everywhere these days. From art and music to tacos and toilet paper, these digital assets are sold as exotic 17th-century Dutch tulips - some worth millions of dollars.
But is the NFT worth the money - or the hype? Some experts say they are ready to burst a bubble like dot-com rage or Beanie Babies. Some believe that the NFT will stay here and that it will change investment forever.
What is NFT? WHAT DOES THE NFT DO?
This is not clearer. That's right, I'm sorry. "Irreplaceable" more or less means that it is unique and cannot be replaced by anything else. For example, one bitcoin is more substitutable - sell one for another bitcoin and you have the same.
However, a one-class trading card is not available. If you exchange it for another card, you have something completely different. You leave Squirtle and get a 1909 Honus Wagner T206, which StadiumTalk calls "Mona Lisa Baseball Cards." (I take her at her word.)
NFT is a digital asset that represents real objects such as art, music, game objects and videos. They are bought and sold online, always with a cryptocurrency, and are usually encrypted in the same encryption software as many cryptocurrencies.
Although they have existed since 2014, NFTs are becoming popular today as they become an increasingly popular way of buying and selling digital artwork. The NFT market is worth $ 15.70 billion in 2021 alone and is expected to reach $ 122 billion in 2028.
NFTs are often the only ones of their kind, or at least one of a very limited number, and have unique identification codes. "In fact, the NFTs are creating a digital crisis," said Arry Yu, president of the Washington-based Technology Association Cascadia Blockchain Council and director of Yellow Umbrella Ventures.
This is very different from most digital creatures, whose offer is almost always unlimited. Hypothetically, a bid restriction should increase the value of the asset, if required.
But many NFTs, at least in those early days, have become digital creatures that already exist in some form elsewhere, such as iconic NBA video clips or secure versions of digital art. which is already floating on Instagram.
Renowned digital artist Mike Winklemann, better known as "Beeple," composed 5,000 daily drawings to become the most famous NFT of 2021, "EVERYDAYS: The First 5000 Days," sold to Christie's for a record $ 69.3 million. Everyone can view individual pictures for free - or even a whole collection of pictures online. So why are people willing to spend millions on something they can easily view or download?
Because NFT allows the buyer to have the original item. Not only that, it includes built-in authentication that serves as proof of ownership. Collectors value these "digital creations" almost more than the thing itself. How is NFT different from cryptocurrency?
NFT means unmistakable token. It is usually created using the same type of programming as a cryptocurrency, such as bitcoin or ethereum, but that's where the deal ends.
Physical currencies and cryptocurrencies are "available", which means that they can be exchanged or exchanged. They are equal in value - one dollar always costs another dollar; one bitcoin is always the same as another bitcoin. The Krypto function makes it a reliable way to perform blockchain transactions.
NFTs are different. Each has a digital signature that prevents the NFTs from being interchangeable or identical (ie, for example, an NBA Top Shot clip does not equal EVERYDAYS simply because both are NFTs.)
How does NFT work?
NFTs are in blockchain, which is a publicly distributed ledger that records transactions. You probably know blockchain most as the basic process that allows cryptocurrencies. At a very high level, most NFTs are part of the Ethereum blockchain, although other blockchains run their own version of the NFT. Ethereum is a cryptocurrency, like bitcoin or dogecoin, but its blockchain also tracks who holds and trades the NFT.
In particular, NFTs are usually kept in the Ethereum blockchain, although other blockchains also support it.
The NFT is created or "created" from digital objects that represent tangible and intangible objects, including:
Graphic Design
GIFs
Videos and sporting events
Collection
Virtual avatars and looks for video games
Design sneakers
musician
Tweets also count. Twitter co-founder Jack Dorsey sold his first tweet as NFT for more than $ 2.9 million.
In fact, NFTs are like physical collectibles, only digital. So instead of a real oil paint on the wall, the buyer gets a digital file instead. They also received exclusive ownership rights. NFTs can only have one owner at a time, and their use of blockchain technology makes it easier to verify ownership and transfer tokens between owners. The creator can also store specific NFT metadata. For example, artists can sign their artwork by inserting their signature into a file.
What are NFTs used for? Blockchain and NFT technologies give artists and interior designers a unique opportunity to monetize their sales. For example, artists no longer have to rely on galleries or auction rooms to sell their art. However, the artist can sell it directly to consumers as an NFT, with whom he can also save considerable income. In addition, artists can program royalties to earn a percentage of the sale each time they sell their art to a new owner. This is an attractive feature because artists often do not receive any future income after the first sale of their art. Art is not the only way to monetize the NFT. Brands like Charmin and Taco Bell are auctioning NFT-themed art to raise money for charity. Charmin called the offer "NFTP", and Taco Bell's NFT art sold in minutes, with the highest bids reaching 1.5 packaged ether (WETH) - $ 3,723, 83 at the time of writing. .
The Nyan Cat, a 2011-era GIF with a cat with a pop-tart body, sold for almost $ 600,000 in February 2021. And the NBA Top Shot generated sales of more than $ 1 billion in May 2022. LeBron James NFT promoter earned more than $ 200,000. Even celebrities like Snoop Dogg and Lindsay Lohan jumped into the NFT car and released unique memories, artwork and moments like the securitized NFT.
How to buy NFT
If you want to start your own NFT collection, you need to get a few basic things:
First you need to buy a digital exchange with which you can store NFTs and cryptocurrencies. You may need to buy a cryptocurrency, such as Ether, depending on the currency your NFT provider accepts. Today, you can buy cryptocurrency using credit cards on platforms like Coinbase, Kraken, Netcoins and even Wealthsimple, through Wealthsimple Crypto. You can convert it from the stock exchange to the stock exchange of your choice.
You should keep the fees in mind when researching options. Most exchange offices pay at least a percentage of your transaction when you purchase cryptocurrency.
Popular NFT marketplace
Once you are out of your stock market and funded, there is no shortage of NFT sites where you can shop. Today, the biggest brands of NFT are:
OpenSea.io: This peer-to-peer platform pays to be a provider of "unique digital objects and collections". To get started, all you have to do is create an account and browse the NFT collections. You can also sort the pieces by sales volume and find new artists.
Rarible: Like OpenSea, Rarible is a democratic, open market that allows artists and creators to publish and sell the NFT. RARI tokens issued by the platform allow holders to evaluate aspects such as fees and community rules. Foundation: Here, artists should receive "votes" as an invitation from fellow creators to place their works of art. The exclusivity and cost of performing a community - artists also have to buy "gas" in order to mint the NFT - means they can have higher quality works of art. For example, Nyan Cat creator Chris Torres sells NFT on the Foundation platform. It can also mean higher prices - which may not necessarily be bad for artists and collectors who want to take advantage, because demand for the NFT remains current or even increases over time.
Although these and other platforms host thousands of NFT creators and collectors, be sure to research them carefully before purchasing. Some artists have fallen victim to imitators who list and sell their works without permission.
In addition, authentication processes for NFT creators and lists are inconsistent across platforms - some are more stringent than others. For example, OpenSea and Rarible do not require proprietary authentication for NFT lists. Buyer protection seems to be minimal, so if you are buying an NFT, this may be the best.