Do you remember Nyan Cat? The pixelated cat with a Pop-Tart for a body that has crisscrossed the space while pulling a rainbow on its back? Of course you do. The artist who created the GIF Nyan Cat recently sold it for $ 600,000. In addition, the American artist Beeple has just sold an NFT entitled “The First 5000 Days” via the prestigious British auction house Christie’s for an incredible amount of 69.4 million dollars.
The staggering sums for which some non-fungible tokens or NFTs have sold has led to a frenzy among those on the cutting edge of technology as well as traditional investors. But what is an NFT? At first glance, NFTs may seem similar to cryptocurrencies, especially since the word ‘blockchain’ is associated with them. That being said, they are quite different. So if it’s not a new cryptocurrency, what is it?
What is an NFT?
NFT stands for “non-fungible token”. In this case, “non-fungible” means that it cannot be exchanged for a similar item. It is different from something that is “fungible”. For example, a Bitcoin is fungible because it can be exchanged for another Bitcoin. Since an NFT is a single digital item, it cannot be exchanged for a “like item” because there is nothing else like it.
An NFT can be anything: a Tweet, a Kings of Leon Album or one Pop-Tart Cat. The key is that an NFT is verified on the blockchain – a decentralized ledger that acts as a record of both authenticity and ownership.
How do NFTs work?
We know what you are thinking. If an NFT is just a digital thing, then why would anyone actually pay for it? As long as you are prepared to break copyright law, anyone can make a copy of anything digital for free. We can easily reproduce the Nyan Cat GIF as we like – just copy and paste, and you have an exact copy.
This is where people are confused. An NFT is often associated with digital art. When we think of works of art, we think of physical and tangible objects. For example, we all agree that owning the physical canvas of Jackson Pollock Blue sticks means property. Someone could make a print of this work of art and hang it on their wall, but only one person really owns it.
NFTs seek to provide an indisputable property of a digital object, despite the fact that, by nature, digital elements are easy to reproduce. Basically, if you buy an NFT, you buy the rights to that digital artifact. And since the sale is verified through blockchain technology, anyone, anywhere, at any time, can see the transaction.
Are NFTs Really Valuable?
Many people see the rise of NFTs as proof of an economy gone mad. Others see a booming investment opportunity that represents the next evolution in art. Think of it this way: imagine a famous work of art like Starry Night by Van Gogh. The original hangs in the Museum of Modern Art in New York. While it is almost impossible to value such a famous work of art, other works by Van Gogh have sold in the past for around $ 80 million. Given the fame Starry Night is that it is estimated to be worth over $ 100 million.
If you are a fan of Starry Night, you can easily find a print to buy. However, this impression is really worthless. After all, it’s just a piece of paper with an image printed on it. However, as we have established with Blue sticks above, owning the original is valuable. This same principle can be applied to NFTs. Of course, the digital element can be copied and reproduced a million times. Ultimately, these copies are worthless. But the NFT proves you own the original, and it could be worth a lot of money – provided someone is willing to pay for it.
Where can I buy NFTs?
Since NFTs have become mainstream, there are sites all over the internet to capitalize on this new market. Unfortunately, buying NFT can be complicated. Some of these markets only allow you to buy NFTs with certain cryptocurrencies. Others run on special ‘tokens’ or require you to link your digital wallet to the site before you can buy. As with everything, always do your research before transferring money. That being said, some of the more popular NFT markets are Openea and Super rare. Have a good collection!
Now that you know what a non-fungible token is, are you interested in buying it? If so, you might also need a cryptocurrency wallet to store it. Do you think this is the future or just some silly fad? Let us know in the comments!
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