09 April, 2021 

What is NFT? Why everyone talks about them

Blockchain and the crypto ecosystem grow stronger every year and offer new opportunities not only in the financial field but also in the art space.
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What is NFT? Why everyone talks about them

Blockchain and the crypto ecosystem grow stronger every year and offer new opportunities not only in the financial field but also in the art space.

Meet the non-fungible tokens or NFTs. It's a new crypto-based trend that totally won the attention of both crypto investors and famous artists. In particular, DJ 3LAU became the first in the world to make $1.6 million by selling his album in the form of NFT tokens.

What Are Those NFTs?

Imagine that any piece of art can be tokenized. This means turning the digital artworks and other collectibles into the unique assets that are easy to trade on blockchain. Not everyone understands the idea of such tokens, but many artists, musicians and celebrities have already benefited from them. Investors are ready to spend big money for owning the NFT versions of digital pictures. For example, Jack Dorsey's first tweet costs $2.5 millions at the moment , and Lebron James's dunk video was sold for over $200,000.

Why are NFTs unique? Every record in a chain of blocks is called a token. But in an open chain all blocks are equal and fungible. This means you can replace one by another of the similar type, and nothing will change. But the non-fungible token technology works differently. Each token is unique; it can't be divided, replaced without notice, or changed. It's a perfect scheme to guarantee someone's rights to own an artwork.

Copyright Problems

On the one hand, the NFT technology helps to sustain the copyright in the digital art that already wins over the forms of traditional art we used to know. It seems legit but is it all really that simple with the rights for tokenized art? The creation and sales of the NFTs based on art you have no rights for is a crime and it doesn't go along with the main idea of non-fungible tokens. This is why NFT web auctions were so fast to create the DMCA processes for removing the unauthorized NFTs. But it's not quite clear whether it will be enough because many websites encourage people to tokenize the art they don't owe. Other marketplaces accept only verified works; these are not that risky to use.

How It All Began – Where Do First NFTs Come From?

The NFT technology was created in 2017 based on Ethereum's smart contracts. Nonfungible reports that over 5.35 millions NFT tokens were sold by the end of February. NFTs became a phenomenon in the field of digital art not so long ago but they weren't the first experiments of this kind. In fact, CryptoKitties, a digital Ethereum-based crypto game, was one of the proto-NFT. It allowed its users to purchase and sell the virtual cats that were unique and stored in the blockchain. The first NFT marketplaces started being popular in winter of 2021.

How to Create Your Own NFT?

Anyone can create an NFT. All you need is a digital wallet with a bit of Ethers on the balance and a connection to an NFT marketplace where you can download your content and turn it into an NFT automatically. Also, anyone can create an NFT of their own. For this, you need to create a unique product you can sell. But making a fortune on this sale is more likely if you are a celebrity. For example, the singer Grimes sold a bunch of her digital arts for over $6 millions. How much do NFTs cost? They may cost as much as you want; you can put a fixed price or take part in an auction. Practice shows that the price of your artworks is proportional to your net worth.

What Will the Future Bring?

What if it's all just a bubble and NFTs actually cost zero? An acknowledged art expert, Nolan Davis, commented about that to the BBC channel. He is sure that NFTs are the future of art where the barriers between the real and the digital shift. The NFT craze is another proof that blockchain and crypto platforms can genuinely change the world in so many ways and reach all the spheres of human activity. Everyone discusses NFTs now, even those who had just discovered crypto and how it all started.

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