ABC of Non-fungible Tokens (NFTs): Why Are Digital Arts a Sensation Today?
Non-fungible tokens are one of the most exciting aspects of blockchain as it opens up a whole new avenue for artists and creators to monetize their work.
Many people, both crypto and non-crypto lovers may have heard about the word “NFTs” (Non-fungible tokens). Despite the popularity of the phrase, a few do not still understand what it means and why the crypto community is so keen on purchasing it.
To start, “Fungible’’ in English means something replaceable. In fact, fungible things are items that can be easily replaced with another item that is practically the same, such as wood or paper currency (e.g. Dollar, Euro are fungible).
Whereas, non-fungible is unique and immutable. To break it down in simple terms, Non-fungible tokens (NFTs) are arts in a digital form — they can represent digital arts such as GIFs, music, videos and games.
Similarly, NFTs could represent real world items including tickets to a real-world event, tokenized invoices, deeds to a car, legal documents and signatures.
“Token” on the other hand, can be referred to as a thing, serving as a tangible representation or a voucher or a ticket for something.
Just as arts are collected physically, NFTs are similarly collected, stored and sold digitally. NFTs are synonymous with physical arts including art gallery exhibitions and auctions that are done in the real world.
There are different types of actors in the NFT sphere — creators, collectors and buyers.
Creators are those that create the NFts while collectors are those that purchase these arts for the long-term. Creators can keep ownership rights over their own work and claim resale royalties directly.
There is also the group of people who buy to resell almost immediately after the price of the NFT goes up. They are usually referred to as the “buyers.”
Non-fungible Tokens and Crypto Arts Ownership
Non-fungible tokens (NFTs) are a relatively new type of crypto asset and digital art. They represent unique ownership and allow artists to be paid directly by the collectors of their work.
They are a form of digital assets that differ from fungible tokens in that each one is unique and distinctive.
The first NFTs were built on the Ethereum blockchain to more permanently and securely record ownership data than traditional physical documentation can.
The ownership of NFTs is managed via the uniqueID and metadata that no other token can replicate. Smart contracts that assign ownership and govern the transferability of NFTs are used to create them. When someone generates or mints an NFT, they are executing code from smart contracts that follow various standards, such as ERC-721.
Proving you own an NFT is very similar to proving you have ETH in your account. The token proves that your copy of the digital file is the original. Your private key is proof of ownership of the original. The content creator’s public key serves as a certificate of authenticity for that particular digital artefact.
Non-fungible Tokens (NFTs) Use Cases
Non-fungible tokens (NFTs) have several use cases — the potential is limitless.
Non-fungible tokens can be used as in-game collectibles and assets. These collectibles are a form of digital collectibles that you can trade or sell.
Game developers can earn royalties every time an item is resold in the open marketplace. This means players and developers earn from the secondary NFT market.
They can also be used to represent physical assets on a blockchain, such as real estate and cars.
NFTs can be transferred onto other wallets, but each token is unique and no one else in the world will have the same token. In this way, they allow users to trade tokens privately without revealing their identities.
Users can use digital artwork as collateral in a decentralised loan. There are currently several DeFi applications that are exploring using NFTs as collateral.
Where Can I Trade Top Collectibles and NFTs Tokens
There are several places to buy and sell NFTs. Every day, it becomes easier to access these with several exchanges launching their own NFT marketplace and even independent firms creating their own marketplaces.
Other than that, you can also trade the tokens in top cryptocurrency exchanges such as LBank.
LBank exchange is one of the top 20 trading platforms designed in 2015 by experts with a wealth of experience in the cryptocurrency industry. LBank is quite popular for its deep liquidity and is known for listing good Metaverse, GameFi, NFT, and DeFi tokens before they become available on other major cryptocurrency exchanges.
The centralised trading platform is one of the world’s renowned places to buy, sell, and store cryptocurrencies. Currently, it supports trading with over 500 different cryptocurrencies and is working daily on adding new ones.
How to Buy the NFT Tokens on LBank
To buy an NFT token on LBank, you will need to first,
1. Download the LBank exchange app on the App Store or Google Play with your mobile. You can also access LBank on your browser.
2. Fund your LBank wallet when you click the ‘Buy Crypto’ button. Then, select your preferred payment options which include Credit/Debit Card, bank transfer and other accredited payment gateways on the platform.
3. After that, you can go to ‘markets,’ under spot markets, you choose USD and finally select NFT. Alternatively, you can search for the token you intend to buy directly on the ‘Search’ button.
4. Click on the token you want to buy, set the amount and click on “buy”