What Are NFTs and What Will They Become?
NFT seems to be one of the main buzzwords these days. Most people have heard of NFTs, but many don’t quite understand them yet. They have something to do with the art and music world, and you can buy and sell them, right?
Well, NFTs are actually so much more than that, and in this piece, we’ll tell you everything you need to know about them. We’ll explain NFTs, how they work, how to create one, and where this whole industry is going. Let’s begin!
What Are Non-Fungible Tokens (NFTs)?
A Non-Fungible Token is a digital asset that operates as a virtual representation of a specific real-world asset like an item in a video game, an art piece, a music composition, or something else.
NFTs have been with us since 2014 but have only recently started to gain more traction. Their prominence is so significant that the value of the NFT market is equal to the entire global fine art market, which amounts to around $41 billion.
The main appeal of NFTs is that they are entirely unique. This makes them a rarity in the digital realm, where anything created can be copied an infinite number of times. NFTs are non-fungible, meaning they cannot be replicated, making them exclusive. This is also what gives every NFT its inherent value.
NFTs use blockchain technology and smart contracts to prove ownership, so everyone who truly owns one can easily prove that this specific NFT is theirs. To create smart contracts, NFT platforms need developers. For instance, they can hire Ethereum developers to create a self-executing mechanism that helps assign ownership to a buyer.
Every NFT is created (minted) from any type of digital object that can act as a representation of either a tangible or an intangible object. It can be a simple GIF, a video game item, an avatar, a piece of music, or even a tweet.
Using NFTs — What Can I Do With Them?
One of the primary uses of NFTs is in the art world. Artists use NFTs to gain a unique opportunity to monetize their craft.
For instance, a painter can create an NFT instead of showcasing their work in a gallery. This makes it easier for them to showcase their art, sell it, and keep more profits. They can even encode royalties into the NFT so that whenever their former NFT sells, they get a percentage of that sale.
Besides this, NFTs can even be used for charity, where a celebrity or a brand can auction off an NFT art piece or some other asset. The money raised is then donated to a specific cause.
But that’s not all. As NFTs can represent virtually anything, their usage is practically limitless. People are only starting to see their true potential, and we are bound to witness various unique and amazing applications of NFTs.
Creating NFTs — Where to Start?
Once you’ve completely understood what NFTs are, and this piece only scratches the surface, you can finally get round to creating one.
You’ll need two things for this:
- Digital wallet
- NFT marketplace
The first is simple. A digital wallet is an app where you’ll get to store your NFT, and it’s where you’ll deposit the crypto that will fund it. You should pick one of the top NFT wallets and create an account with the service. The more popular ones are Metamask, Alpha Wallet, Coinbase Wallet, Math Wallet, and Trust Wallet.
As for an NFT marketplace, this will be the place where you’ll actually get to create the NFT and later sell it. Countless platforms using a wide range of blockchains exist, so you’ll also have to settle on a specific blockchain to choose an NFT marketplace powered by it.
Bear in mind that most NFTs are created on the Ethereum blockchain because of its unique technology that also uses smart contracts.
You can always go for some of the obvious choices like OpenSea, Rarible, Nifty Gateway, Axie Marketplace, and others.
Alternatively, you can use an advanced platform like Looking Glass Labs, which goes above and beyond with NFT creation, going into 3D assets as well. Its business model can even help you find the best audience interested in a specific type of NFT.
The Future of NFTs
NFTs are revolutionizing the world of digital ownership, and their functionality allows anyone to create a unique digital asset or item and then sell it via an open marketplace. They are used in many industries and are poised to reach many more due to their inherent flexibility.
NFTs are even becoming one of the primary technologies for assets in various metaverses. This makes them crucial for the future world of the internet, Web3.
They can verify the authenticity and prove ownership, making them ideal for the future where most things will happen online. We could even reach a world where every asset or good is an NFT, making it unique, protected, and valued.