NFT, if you spend your time on Twitter, YouTube, or social media, then you must hear about NFT. In this article, you will learn all about Non-Fungible Tokens.
Table of Contents
What is a Non-Fungible Token?
A fungible item is an item that can be exchanged for another so Non-Fungible means that something cannot be replaced or exchanged for other items because of its uniqueness. Like your favorite actor Shahid Kapoor gives his own signature T-Shirt to you so can you give that T-Shirt to anyone? Of course not, because that T-Shirt has a signature of your favorite and which makes that T-Shirt unique from any other T-Shirt.
Similarly Non-Fungible Token is a digital asset that is unique and also that cannot be exchanged with any other. You can purchase or sell them. NFTs are tokens that live on a blockchain and represent ownership of unique items.
Imagine you make a piece of art so NFT contains information about it like a fingerprint of the file, symbol, hash of the file, or name of the token which is making that art unique. Then this token is stored in a blockchain and in the blockchain, no one can edit, delete or alter any data.
Example of NFT: –
The founder of Twitter sold his first Twitter as an NFT. Everyone can see Twitter on his profile but only one person can own it and that person purchase it from the Twitter founder and paid over 3 billion dollars for it.
If you have uploaded some videos on your YouTube channel then you could make a Non-Fungible Token out of videos to anyone. They can buy it and be the owner of the video even though it’s free to watch.
When did this invented?
The first NFT was created by Kevin McCoy and Anil Dash in May 2014. Then in October 2015, the first NFT project, Etheria, was launched at DEVCON 1 in London. Then NFTs came into existence when two digital artists, Matt Hall and John Watkinson, developed Crypto Punks, NFT launched in 2017 via Ethereum & GitHub.
Pros and Cons of NFT?
You know every technology has its own pros and cons. When you will purchase or sell Non-Fungible Token then you must have knowledge about its pros and cons of it.
- There is an increment in benefit in terms of blockchain and cryptocurrencies because the buyer is largely attracted to the traditional art market or digital market; Which means there is a potential work market for your work without the actual need for art dealers and art advisors.
- Like with another investment, when you buy Non-Fungible Token then there’s always potential growth in the value of NFT. For example, there’s a maximum chance of an increment in the value of cryptocurrency.
- When you purchase Non-Fungible Token then it must be unique. It is different from others and irreplaceable. It’s a proud feeling when you know you’re the owner of something unique whether it is digital assets, painting or a digital image, etc. It’s one and only one piece in the entire world.
- You can do purchases or sales of Non-Fungible Tokens from home as well. So, it saves lots of energy consumption to go to market and also traveling costs. It saves official rent for the person who wants to sell it, because of the availability of the digital world.
- As you know, today is a digital world. It means there’s no more physical art available on the market. And also, you can’t convert that physical art into digital art.
- Many people have lost their job because they are not experts in digital. Mostly 90s people have to face this problem because at that time, there was only physical art plus there were not so many computers so people can learn about it.
- NFTs are very confusing assets for everyone (even for experts) because when you purchase one of these arts, you can be the owner of that art but you don’t need to purchase the copyright of that art. You can find that art on the internet and also you can copy that art also as much as you want. There’s nothing stopping them from copying and searching for art. So, when you buy one of these digital assets (NFTs) then you’re the only owner of that unique digital asset but you will not be able to stop people from copying it.
Future of Non-Fungible Tokens: –
Now you must be thinking about the future of NFT so let’s discuss the future of.
- NFTs will play a big role in the metaverse which is immersive (a part of blockchain) technology. This digital world in which you enter means that you should buy or sell any items digitally only which means that you can have unique items and you can have ownership of unique items.
- NFTs will continue increasingly work with the internet because of the digital world. You have smart devices connected to everything, items like cars, machinery, and wireless devices are connected to the internet. The Internet is collecting and transmitting data. You can see that the internet is the best way to communicate with each other so these items can sell and purchase online through the internet.
- NFTs will be helpful in healthcare centers, hospitals, offices, etc. Because they have so much data to collect and keep safe. These data will be held in databases if you move this to the blockchain to NFTs technology then you can use that data in the future whenever required. This data/information needs to be very protected every time.
- NFTs have a bright future in gaming too. A new video game allows you to collect, purchase and sell NFT. Now there are new hundreds of games built around NFTs. You and so many peoples love to play games online so it’s obvious people will continue to play games in the future too. You can earn money by gaming.