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NFTs: What’s the Hype and What You Need to Know

Source: Beeple, Everydays — The First 5000 Days sold for $69 million

With the NFT market heating up, many people are seeing immense returns on NFT’s. The best time to learn about NFTs was when Punks were selling at $44 and the second-best time is now. Their influence spans over a number of industries dealing with intellectual property, like digital artworks and music in addition to tangible, real-world assets like real estate.

Non-fungible tokens (NFTs), unlike regular cryptocurrency tokens, are unique cryptographic tokens that cannot be exchanged at the equivalent of one another. The word “fungibility” refers to the quality of an asset to be readily interchangeable for another of the like kind. For example, one ASD (AscendEX’s native token) can be traded for another ASD in circulation. NFTs, on the other hand, possess unique identification codes that distinguish one from another, making each one unique. Many NFTs come in the form of JPEGs, GIFs, and PNGs. NFTs are priced for purchase in the token they were minted with, such as ETH or SOL, and prices are based on demand, thus considered: “non-fungible.”

NFTs contain ownership details that can be both transferred and easily identified between owners, with an ability to be used as digital representations of real-world assets, like real estate properties or physical artwork. Most commonly, they are used by decentralized applications (DApps) to issue one-of-a-kind digital items and crypto-collectibles. Since their creation, various frameworks have been developed to facilitate the issuance of NFTs. Some of the most prominent frameworks used to mint NFTs are ERC-115 and ERC-721, which are standard interfaces for NFTs that allow for the implementation of a standard API within smart contracts on the Ethereum network. This type of standardization makes it possible for holders to transfer NFTs easily.

When an NFT is minted, a tokenized representation of the physical or digital asset is created, and its record of creation is distributed to the public ledger, just like any standard transactions on the blockchain. Essentially, NFTs are proof of ownership in digital form. Because of the unique construction, NFTs effectively create digital scarcity for the asset that they represent, often generating exponential growth in prices and further bolstering the case for a continued NFT boom. Below are some of the most expensive and sought after NFTs sold at auction or on marketplaces to date:

Source: Beeple, Everydays — The First 5000 Days sold for $69 million
Source: CryptoPunk #7804 sold for $7.5 million
Source: Beeple, CROSSROAD sold for $16 million

Currently, much of the market for NFTs centers around collectibles, including digital artwork and rarities, with multiple NFT projects gaining popularity among crypto enthusiasts and collectors. Amid existing protocols, AscendEX introduced the listing of two high quality NFT projects and their native tokens, ECOMI(OMI) and Ternoa(CAPS), to its users. AscendEX offers staking with an est. APR 70% for Ternoa(CAPS). Users can generate return on investment by simply holding their CAPS or OMI on AscendEX.

Non-fungible tokens are the latest disruptive evolution from blockchain technology. NFTs are a step in the right direction towards the development of financial infrastructure that enables digital representation and verified ownership of physical and digital assets.

There are a variety of NFT marketplaces where a user can create, buy, and sell NFTs conveniently. Currently, there are hundreds of thousands of different NFT projects available on a number of different marketplaces, so AscendEX suggests that users do their own research before trying out any platform. If you want to further explore details of interesting NFT items and the prices that they sell for, below are some of the most popular NFT marketplaces available online:

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AscendEX is a leading global digital asset financial platform founded by a group of Wall Street quantitative trading veterans in 2018, servicing retail and institutional clients in over 200 countries and regions of the world.

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