NFT for Noobs
In the recent past, the virtual world and digital arts has spread like a wildfire. The heat of the cryptocurrency boom is sensed all around the globe as people continue to get intrigued about this space.
For quite some time now, there is a new craze that has developed all over the news and social media — NFTs. Most people are dumbfounded by the concept though. It’s quite amusing how a small piece of digital art can be worth millions of dollars isn’t it? Let’s try and understand why.
What is an NFT?
Non-Fungible Tokens (NFTs) are cryptographic assets that people can buy or create on various blockchains. The buyers get digital proof of ownership of the art piece, while the Artist makes a reasonable sale.
Unlike cryptocurrencies, NFT’s are one-of-a-kind. They cannot be traded for another because they are unique and each token has a different value.
Thanks to blockchain technology, keeping track of the wallets between which the assets have been exchanged is easy and very accessible. This makes NFT transactions smooth and eliminates middlemen altogether. (Check out “Blockchain for Noobs”)
Are cryptocurrencies and NFTs the same?
NFTs are different from fungible items like cryptocurrency or money as they can be easily exchanged. For example, Bitcoin can be exchanged for another cryptocurrency, but NFTs can’t be traded with one another. Each unique token holds a value of its own in the digital market that is assigned by the creator/seller, making it truly unique.
How does it work?
Each NFT that is minted, has a blockchain-based digital certificate for the artwork or collectible. The proof-of-sale and purchase details are stored in the blockchain, ensuring that the NFT is authentic. This avoids forgery as well.
In 2021, some of the top NFT creators include Beeple also known as Mike Winkelmann an American digital artist, graphic designer and animator, who sold his digital collage for 69 million dollars. His work has ignited a spark in thousands of aspiring young minds to do something out of the blue.
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