What do you need to know about NFTs?
I’m pretty sure you’ve heard of NFTs before but you feel overwhelmed by the trend. Don’t worry, you are already at the right address.
Let’s Start!
An NFT — non-fungible token — is a digital asset that represents a real-world object like, for example, the Charlie Bit My Finger video that sold for £500,000 back in May.
NFTs are bought and sold online, frequently with cryptocurrency, and are generally encoded with the same underlying software as many cryptocurrencies.
Early history (2011–2017)
2014: The first known “NFT”, Quantum, was created by Kevin McCoy in May 2014 and bought by Anil Dash, during a live presentation for the Seven on Seven conferences at the New Museum in New York City. They referred to the technology as “monetized graphic(s)” at the time.
2015: In October 2015, the first NFT project, Etheria, was launched and demonstrated at DEVCON 1, Ethereum’s first developer conference, in London, UK, three months after the launch of the Ethereum blockchain. The term “NFT” only gained currency with the ERC-721 standard, first proposed in 2017 via the Ethereum GitHub, following the launch of various NFT projects that year. These include Curio Cards, CryptoPunks (a project to trade unique cartoon characters, released by the American studio Larva Labs on the Ethereum blockchain), and the Decentraland platform. All three projects were referenced in the original proposal along with rare Pepe trading cards.
Public awareness (Late 2017–2021)
Public awareness in NFTs began with the success of CryptoKitties, an online game where players adopt and trade virtual cats. Soon after release, the project went viral, raising a $12.5 million investment, with some kitties selling for over $100,000 each.
2018: Following CryptoKitties’ success, another similar NFT-based online game Axie Infinity was launched in March 2018, which then proceeded to become the most expensive NFT collection in May 2021.
2019: Nike patented a system called CryptoKicks that would use NFTs to verify the authenticity of physical sneakers and give a virtual version of the shoe to the customer.
NFT buying surge (2021–present)
In the early months of 2021, interest in NFTs increased after a number of high-profile sales. The speculative market for NFTs has led more investors to trade at greater volumes and rates. The NFT buying surge was called an economic bubble by experts, who also compared it to the Dot-com bubble. In September 2021, Sotheby’s sold a bundle of 101 Bored Ape Yacht Club NFTs for $24.4 million.
What differentiates Cryptocurrency from NFTs?
Non-fungible tokens or NFTs are cryptographic assets on a blockchain with unique identification codes and metadata that distinguish them from each other. Unlike cryptocurrencies, they cannot be traded or exchanged at equivalency. NFTs are different. Each has a digital signature that makes it impossible for NFTs to be exchanged for or equal to one another (hence, non-fungible). Charlie Bit My Finger, for example, is not equal to EVERYDAY simply because they’re both NFTs.
Can anyone make NFTs and Sell Them?
Technically, YES! Anybody can make a craftsmanship, transform it into a NFT on the Blockchain, and put it available to be purchased on a commercial center of decision. You can even connect a commission to the document, which will pay you each time somebody purchases the piece. That incorporates resales.
Much like when buying NFTs, you need to have a wallet set up, and it needs to be stuffed full of cryptocurrency. It’s this requirement for money upfront that causes the complications.
The hidden fees can be prohibitively astronomical, with sites charging a ‘gas’ fee for every sale (the price for the energy it takes to complete the transaction), alongside a fee for selling and buying. You also need to take into account conversion fees and fluctuations in price depending on the time of day. All this means that the fees can often add up to a lot more than the price you get for selling the NFT.
DO I HAVE TO USE A MARKETPLACE SITE TO CREATE AN NFT?
Technically, no. You can create your own smart contract, deploy it to the blockchain of your choice, and then mint your own tokens using it. That’s jumping into the deep end, though, and probably not the route you’ll want to go unless you’re very technical. Most people will want to use one of the platforms discussed above.
Popular NFT Marketplaces
Once you’ve got your wallet set up and funded, there’s no shortage of NFT sites to shop. Currently, the largest NFT marketplaces are:
• OpenSea.io: This peer-to-peer platform bills itself a purveyor of “rare digital items and collectibles.” To get started, all you need to do is create an account to browse NFT collections. You can also sort pieces by sales volume to discover new artists.
• Rarible: Similar to OpenSea, Rarible is a democratic, open marketplace that allows artists and creators to issue and sell NFTs. RARI tokens issued on the platform enable holders to weigh in on features like fees and community rules.
• Foundation: Here, artists must receive “upvotes” or an invitation from fellow creators to post their art. The community’s exclusivity and cost of entry — artists must also purchase “gas” to mint NFTs — means it may boast higher-calibre artwork. For instance, Nyan Cat creator Chris Torres sold the NFT on the Foundation platform.
It may also mean higher prices — not necessarily a bad thing for artists and collectors seeking to capitalise, assuming the demand for NFTs remains at current levels, or even increases over time.
Although these platforms and others are host to thousands of NFT creators and collectors, be sure you do your research carefully before buying. Some artists have fallen victim to impersonators who have listed and sold their work without their permission.
In addition, the verification processes for creators and NFT listings aren’t consistent across platforms — some are more stringent than others. OpenSea and Rarible, for example, do not require owner verification for NFT listings. Buyer protections appear to be sparse at best, so when shopping for NFTs, it may be best to keep the old adage “caveat emptor” (let the buyer beware) in mind.
The Nfts presented another opportunity to make money. It cannot be considered totally easy but it is never impossible for beginners. I’ll be so happy if you share what you think? and how much people can benefit from this field?
Thank you for yout time💐
Read: What are the things to avoid when buying cryptocurrency?
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