Non-fungible tokens (NFTs) have exploded over recent months. From art collections like that from Artblock to our favourite profile pictures avatars like Punks, BAYC, and Cool Cats. NFTs are currently the hottest asset with trading volumes in the billions! But are NFTs really here to stay?
What is a Non-Fungible Token?
In economics, a fungible asset like dollars can be readily interchanged while still maintaining the same value because their value defines them rather than their unique properties. For example, swapping a $10 note for two $5 notes.
However, if something is non-fungible, this is impossible — these things are not interchangeable with other items because they have unique properties. For example, a painting like the Mona Lisa.
NFTs are tokens that can be thought of as certificates that represent ownership of these unique non-fungible items. They let us tokenize everything from art, and collectibles, to even real estate. They can only have one official owner at a time and most NFTs are secured by the Ethereum blockchain — the record can’t be forged because the ledger is maintained by computers around the world.
How do you trade NFTs?
There are many marketplaces to buy and sell NFTs. Depending on which marketplace you choose, you’ll be able to purchase different types of art or collectibles. As most NFTs are Ethereum-based, the majority of the trading volume and marketplaces are all on Ethereum. Each platform operates slightly differently so we compounded a list of the most popular marketplaces on Ethereum.
OpenSea is the largest NFT marketplace that operates on Ethereum. Users can interact with the platform to exchange NFTs for cryptocurrencies or vice versa. It offers a variety of digital collectibles, from music to digital artwork. To use the platform, you need a web3 cryptocurrency wallet such as MetaMask. Your Ethereum wallet address acts as a username and password and lets you interact with certain platforms like OpenSea. Once you’ve connected your wallet, you’re ready to start browsing the market and placing bids!
SuperRare is a peer-to-peer marketplace for buying and selling single-edition digital artwork. The site receives a lot of traffic and is home to a curated selection of artists and brands. What makes SuperRare so unique are its social features giving the site the feel of an online magazine. The platform operates with Ethereum’s network, so you’ll need to fund your account with Ether to make your purchase.
Nifty Gateway is an NFT marketplace owned by the popular cryptocurrency exchange Gemini. The platform is structured around ‘’drops’’, in which collections are made available for a limited time. The company also has a secondary marketplace that allows collectors to resell artwork. You can fund your Nifty account with Ethereum, or you can connect a credit card directly on its website.
Rarible is an Ethereum-based platform that facilitates the creation, sale, and purchase of ownership rights to digital works of art via non-fungible tokens (NFTs). In the midst of a shift to become a decentralized autonomous organization, Rarible will soon be governed by the rules of the Ethereum blockchain, which allows for public, permissionless use. A governance token known as RARI allows the most active buyers and sellers to vote for platform upgrades and participate in moderation decisions.
Centralized NFT marketplaces
Binance, one of the largest cryptocurrency exchanges around the world, announced the launch of its own NFT marketplace in June 2021. Their aim is to provide the largest NFT trading platform in the world with the best minting, buying, and exchanging experience, by leveraging the fastest and cheapest solutions powered by Binance blockchain infrastructure and community.
Looking ahead
While no one knows exactly what the future will bring, we can tell with certainty that NFTs will play a major role in many industries. Mizar is committed to be part of this innovative movement and moving NFT trading to the next phase. We think that NFTs and especially NFT trading will develop and gain further adoption very soon.
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