What is an NFT?
A non-fungible token means it is not replaceable by another identical item. One NFT can not be exchanged for another like with tokens such as Ethereum or Bitcoin.
NFT’s are digitized assets stored on the Ethereum blockchain with a digital certificate created for each asset which makes each NFT completely unique as it can not be forged or manipulated.
NFT’s can be exchanged for digital currencies.
Why are NFT's so big right now
NFT’s gained huge popularity as both famous and new artists joined the scene by selling different kinds of valuable digital assets on NFT marketplaces.
NFT’s enable new possibilities for transactions to take place in the world as we know it, as NFT ownership is easy to certify and transfer.
The blockchain technology that powers NFT’s allow artists, designers, and creators of all kinds to uniquely register their art, this solves a big problem that the art world used to face with piracy, copyright, and duplication of works.
These transactions have caught the attention of many artists and creatives as many artists have struggled in a market where hard work can get copied and resold for cheaper, being detrimental to the value.
What gives an NFT value?
There are a few factors to consider when looking at the value of an NFT, such as:
Rarity: How hard the NFT is to get hold of.
Utility: When an NFT originates from real-life applications, such as physical or digital worlds.
Tangibility: How specific NFT’s may be tethered to real-world objects.
Where can I sell my NFT's?
After we experienced an eruption of NFT’s in early 2021, a whole array of new markets emerged into the crypto scene, there are various sites like OpenSea where you can easily trade with NFT’s.
For example, OpenSea will list your NFT project, free of charge, you also have the option to move your NFT projects over even if they are not on the Ethereum network.
Collecting royalties and trading has become easy and simple!
How do I create an NFT?
Let’s take a look at a few different types of NFT’s, you get art, Video game items, Trading cards/collectible items, memorable sports clips, memes, domain names, virtual fashion, and even miscellaneous items such as tweets. This is really up to you, as the possibilities are endless!
Here are the steps:
Choose a blockchain and type of NFT, as NFT’s can host on various blockchains, keeping in mind that different blockchains offer different standards. The best-known NFT token standards are Ethereum’s ERC-721 and ERC-1151.
Attain yourself some ETH and move it into your wallet, as there will be some transaction fees to keep in mind.
Choose your marketplace, and list your creations! Marketplaces such as Opensea will do most of the heavy lifting for you and guide you through the process.
Where are NFT's stored?
NFT metadata and content can be stored anywhere on the internet, but keep in mind that if a URL is altered, your precious work may be lost forever, therefore it’s your best bet to store your work somewhere safe.
You can opt for a software wallet, they are password protected and secured with a seed phrase.
Hardware wallets are used to store your NFT’s 100% offline and are also password protected.
As it is the responsibility of the owner/collector to safeguard their assets, it is best to add a layer of protection!
How does NFT ownership work?
Ownership is not at all as hard as we have been accustomed to in the past with transfers and paperwork, nowadays, thanks to NFT’s it has become super easy with the support of blockchain technology and the smart contracts that come with it.
An NFT holder simply obtains a non-exclusive license to the underlying intellectual property rights of an asset, and keep in mind that there is even an option for non-commercial use.
Luckily, smart contracts are coded to detail all the limitations on the use of an NFT, which can not be altered or modified. These smart contracts can also take care of automatic royalty payments, and limit the number of replicas that can be made of a piece. Many artists are enthusiastic when it comes to rights and ownership, as they now have access to a system that manages and enforces digital rights!
It is crucial to make sure that, once an NFT is minted, it is permanent, and no changes can be made to the contract.