What is an NFT? Understanding Crypto Non-Fungible Tokens

Overview of NFTs

Non-Fungible Tokens (NFTs) are blockchain assets that can no be broken down into small parts, unlike other crypto assets (BTC, ETH, etc.). These are whole digital units, but they can take many forms: a piece of art, an in-game item, or a real-world item as an NTF. They could also be a piece of music or a video (where you’d get paid for each listen/view). It’s a very broad category and likely there will be NFT use cases that we don’t even know about yet.

Recently Delphi Digital, an independent research firm that analyzes the digital asset market, spent $150,000 on in-game NFTs for the game Axie.

Another example of a high-level use is NBA Top Shot, where you can buy rare clips from historic NBA Basketball games, and it’s likely that many of the users (who buy these Top Shots with a credit card) don’t even realize they are ERC-20 Ethereum blockchain assets.

Rarible.com is presently the most-popular platform. The NFTs that they deal in range from GIFs, actual in-game items, photos, URLs, etc.

When a rarible NFT gets sold and resold, the original artist gets a fixed percentage each time. Of course, because these items are on the blockchain, there is a clear history of transactions that can be traced effortlessly.

How to Mint your own NFT on Rarible.com

The first step is to click in the top right corner on rarible.com on the Create Collectible button.

Then you upload an image, put in your information (description, royalty percentage, etc.) and then you click create.

The last thing to point out is that rarible has its own governance token, the RARI token, giving voting rights on the platform, but you can also claim additional RARI based on your usage of the platform, whether you’re the buyer or the seller.

A Word of Caution

This is a nascent technology, and it’s very speculative and risky. Do your own research and exercise caution.

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