What Is NFT ?

non-fungible token

Crypto Rishi

2 months ago|3 min read

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NFT - non-fungible token is a much talked about and hyped word.

Let's understand what is NFT

Let us imagine Shreya is an aspiring painter, she wishes to conduct an online painting exhibition for all her digital artworks. However, as the exhibition is online, she is worried that her paintings won’t be secure. Anyone could easily forge or replicate them.

NFT - non-fungible token could solve this problem.

Painter (Shreya) could buy nfts for all her paintings as nfts are trustworthy, easily transferable, and will also maintain ownership rights on her artworks.

But what exactly NFT is?

NFTs turn your digital assets into one of a kind by creating a unique digital signature that defines the ownership of your assets and that can be bought and sold for real money.

Non-Fungible Tokens (NFT) means that they are not interchangeable and each of them represents unique assets owned by a specific person.

Whereas fungible tokens are interchangeable and can be divided into smaller units to form the same value. For example, a one hundred dollar bill is fungible, as you can exchange it with five twenty-dollar bills or two fifty-dollar bills.

But the painting of the last supper is non-fungible, as it cannot be generated in bulk, even if it is copied it will not be authentic.

Each nft contains distinguishable information like who owns the digital asset and who sold it. Making them distinct and easily verifiable, as it is impossible to forge such a certificate.

How do NFT works?

NFT creates a blockchain-based digital certificate for your digital collectibles, including games, music, art, and many more. This certificate gives your artwork a unique identity.

The underlying technology and the programming language used by nfts are the same as other cryptocurrencies such as blockchain and the programming language.

Nft majorly exists on the Ethereum blockchain, a distributed public ledger that records all the transactions.

However, nft is quite different from these cryptocurrencies bitcoin and Ethereum are fungible tokens, which means, if you trade, bitcoin or Ethereum for one another, you will have the same value or item in return, basically money.

On the other hand, nft is a unique token. Therefore, if you try to trade it, you may end up with something completely different in your hands.

Example of NFT

Crypto punk is a remarkable example of nft.

It enables you to buy, sell and store 10 000 collectibles, with the proof of ownership being stored on the Ethereum blockchain.

NFT users in the real world

NFT has proved itself to be a boon in the lives of many like Jack Dorsey, the CEO, and co-founder of Twitter.

His first and famous tweet, just setting up my Twitter, was sold in NFT.

Vignesh Sanderson, famously known as medicovan, bought 69.3 million dollars worth of nft art on people.

Conclusion

Owing to its increasing popularity, people are now willing to pay hundreds of thousands of dollars for nfts. NFT has enhanced media exposure and special perks for aspiring artists on social media.

This popularity of NFT creates new opportunities for new art platforms, motivating people to buy art from internet platforms and promoting copyright or originality of digital assets.

NFT could represent a more significant part of the digital economy in the future.

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Let me know if you have any NFT in the comments below.

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Crypto Rishi

Hi, I am an anonymous crypto guy. I am trying to exchange knowledge and build a community around crypto and blockchain. Find all the informational content about crypto and blockchain on my Feeding Trends blog here. If you like the content follow me to get a regular updates.

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