What is NFT?

What is NFT?

Introduction

NFTs are a type of token and are known as non-fungible tokens. In other words, NFTs are a kind of digital assets like art, music, video games, etc that are bought and sold digitally, in exchange for cryptocurrencies.

What are NFT tokens

The question is; What is NFT? Now let's move on to NFT; NFT is a token and stands for Non-Fungible Token. NFTs have been around since 2014 but are now growing in popularity. Because NFTs are limited to circles of technical experts, they gradually push their boundaries, giving everyone a chance to enter.

NFT, or Non-Fungible Token is a special type of cryptographic token that uses blockchain technology to create digital assets that cannot be reproduced. Duplicate tokens are different from known exchangeable cryptocurrencies such as Bitcoin or BTC, Ether or ETH, and XLM, for example, you can exchange one bitcoin for another bitcoin.

The meaning of Non-Fungible

To clarify the concept of non-fungible, you must also become familiar with the concept of fungible. Imagine you have a necklace as a souvenir, someone borrows the necklace from you and delivers it to you the following week. In this case, your souvenir necklace is non-fungible and that person can not return another necklace to you instead of that necklace, because it was a special necklace.

So your souvenir necklace is non-fungible, even if another necklace is similar in appearance to your souvenir necklace. On the other hand, A $ 10 bill is quite similar in value to another $ 10 bill. Imagine a person who has borrowed a hundred dollars from you. That person does not have to deliver exactly the banknotes you gave him, So in other words, the bills that are delivered to you are fungible.

Fungible tokens are tokens that can be traded together and their price remains the same. In the field of cryptocurrencies, one bitcoin has a value equivalent to another bitcoin, and its value is fixed regardless of its owner or history. But in the case of non-exchangeable tokens, the price of an NFT token is different from any similar token.

Individual characteristics determine their uniqueness, so they are as irreplaceable as real-world assets such as gemstones, works of art, or collectibles. Irreplaceable tokens are therefore digital manifestations of assets that can contain information that has a variety of uses and unpredictable value.

The reason for the NFTs importance

NFT tokens have the potential to be an important part of the blockchain-based digital economy, which can be used in various fields such as video games, digital authentication, licensing, certification, or fine arts, and even granting a fraction of the use of ownership. Storing data ownership and identity on the blockchain increases data integrity and privacy, as well as easy transfer and management without the need to trust these assets, which can reduce friction in global trade and the economy.

Gamers and collectors can become the immutable owners of in-game items and other unique assets and make money from them, thanks to blockchain technology. In some cases, players can build and monetize structures such as parks in the virtual world, such as The Sandbox and Decentraland. Players can also sell individual digital items they earn while playing in secondary markets, such as costumes, avatars, and in-game currencies.

Artists can sell their digital work directly to audiences around the world without the need for auctions, thus retaining a greater share of the proceeds from the sale. Royalties can also be scheduled as digital art, and each time an artwork is sold to a new customer, the creator receives a percentage of the profit from the sale.

The benefits of NFTs

  1. They are Non-shared: For example, a cartoon character cannot be shared in another game, the same goes for collectibles.

2.  Rare: The value of irreplaceable tokens is due to their rarity. Although NFT             developers can make these tokens as much as they want; But by limiting their           number, they increase their rarity.

3.  NFTs are Indivisible: Unlike bitcoins, NFTs cannot be broken down into               smaller units, which means that for example, we cannot have an NFT 1/5, and it       exists as a whole.

4.  They are Indestructible: Since all NFT data is stored on the blockchain                 using smart contracts, no tokens can be destroyed. This property also applies to       its owner, i.e. a sword in a video game, for example, has its owner and is not             owned by the game company.

5.  Verifiable: One of the benefits of storing proprietary data on a blockchain is           that the original creator can be traced, confirming authenticity and non-                   tampering.

Who uses NFT?

NFTs are now very popular and artists, brands, and video game players from different cultures use NFT. In fact, many people are interested in NFT stores on a daily basis. The new space  NFT has created for artists has created a new way to create and display artwork.

As mentioned, NFTs are also used in video games for in-app purchases. Before the arrival of the NFT,  these acquisitions were owned by the game developer, where with the help of the NFT, these assets are transferred to the player and he can use them on the game platform depending on the market. Simply put, the newly created NFT games will revolutionize the gaming industry.

Top NFT projects

As the NFT space grows exponentially, the products and projects based on non-tradable tokens have also increased. These products range from games to markets. These are the  3 best NFT projects:

  1. OpenSea: This is the premier marketplace for NFTs and collectibles. Items in this marketplace include ENS, Popular blockchain game tokens, and Crypto collectible items. The highlight of this market is the ability to buy with various cryptocurrencies such as ETH and DAI.
  2. Litemint: This is another irreplaceable tokens marketplace where you not only buy and sell your NFTs but can also make your tokens. The platform also allows art creators to easily define the look and feel of their work. This platform even allows buyers to purchase or modify a section or layer of artwork.
  3. CryptoKitties: CryptoKitties is a blockchain-based virtual game that allows players to buy, raise and trade virtual cats. This game involves combining virtual cats and producing generations that are collectively priced. Kitiz (cats in this game) can be purchased with ETH (Ethereum Network Token).

Conclusion

Now that we know the concept of NFT and What is NFT exactly, you can enter this circle. for example, if you are an artist, a producer of digital products, a game designer, a graphic designer, a filmmaker, or a musician, you can tokenize your products on this marketplace and sell them. But remember that this market may not have reached its final growth yet as it is an emerging market, so it is too early to say anything about the future of this market.