Explain what is NFT?

Explain what is NFT?

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NFT stands for Non-Fungible Token as in something that is unique and it is not replaceable by anything. Blockchain Technology is defined as to put it is a list of records named blocks that are linked by Cryptography. And each block has a cryptographic hash of the one preceding it and timestamp and data of the transaction made, therefore forming a block.

Introduction to NFT

With every hash having data of the previous block and the timestamp the data stored becomes unmodifiable and it cannot be altered without altering all the blocks.

It is a distributed ledger and it also uses algorithms software. To record any digital transaction with anonymity, reliability, and of course safety. 

This is the Technology the NFTs abide by. It also associates with digital photos, audio, and video files as well. The digital ledger acts as ownership proof and but it does not restrict sharing those files or copying them.

It is different from cryptocurrencies even though it uses the same technology because it’s non-fungible because it is not inter-changeable like Ethereum or Bitcoin Cash where every token is the same or equal, each NFTs can be different.

This has come into existence due to the advent of Cryptocurrencies Like Bitcoin Cash, Chainlink, and Cardano, and the technology that underlies them that is Blockchain technology. 

Like the cryptographic hash, it stores the digital signature that clearly shows the ownership of the NFTs.

So, the next question would be what about the copyright. Since NFTs can be anything from digital or a physical asset?


How did NFTs come to be?


It was in the year 2014 when Kevin Mccoy and Anil Dash made the first NFT named Quantum.It consisted of a video of Jennifer Kevin’s wife, McCoy they registered it on the Namecoin Blockchain and then sold it to his friend Dash in 4 dollars in a live demonstration in New York.

Then, in the following year, 2015 Ethereum launched its first NFT project named Etheria. Three months after the launch cryptocurrency remained unsold. This saw an increased interest in the NFTs. 

Until the launch, the NFTs were not that popular but within the year 2017. It started developing interest and there was a surge in buying of NFTs in 2021.


So what are the major type of NFTs?

There are many types of NFTs that are mainly there are five are- Digital Art- Is defined as the art that is made on computers, software, or any other electronic device, it was one of the first where NFTs were applied. Because of the signature feature and the use of publicly registering. The existing piece of art and also authenticating the preexisting art from others and that prevents art forgeries. It also helps in verifying ownership of the same. It is the Block technology that helps in the above process.

Games- The gaming culture is quite popular and the use of NFTs is here when in the gaming sphere one can use these as in-app assets like digital land without the permission of the game owner. NFTs allows the use without taking permission from third parties marketplaces.

Film- In the film industry, the NFTs are used extensively as a tool for promoting upcoming releases through digital posters, music artwork representing the films, etc. 

Music– Musicians are the most to benefit as they can make their work into NFTs and publish them this leads to a good way of generating income from the tours that were canceled due to the Covid -19 Pandemic in 2020. In 2021, one of the leading bands called Kings of Leon published their new album as an NFT.

Memes– There is no reason to define this, memes have become the way of communicating and sharing a good laugh for a few years now, with NFTs one can tokenize them as well. .

Metaverse– Some virtual world enthusiasts who call themselves metaverse have started using NFTs for trading real estate and other items.

Medicine- Some leading universities have issued NFTs for patent disclosure for Prize-Winning inventions like UC Berkeley did for their research on Gene Editing and Cancer Immunotherapy. 


How to buy NFTs?

 To buy NFTs is easy so let’s go step by step-

-a digital wallet that can store cryptocurrencies and NFTs. 

-buy a few cryptocurrencies by using a credit card on sites like Coinbase, Paypal, or Kraken etc.

-then go to sites that sell cryptocurrencies like Opensea.io, Rarible, Foundation.

That is it.


What are the major issues of NFTs?

Environmental Hazards- It is known that everything we do in our lives leaves a carbon footprint and as individuals, we should try to reduce them. In the case of NFTs, blockchain technology uses lots of energy which results in the emission of greenhouse gases.  And this harms the environment. There are steps abode to reduce like the use of chain transactions that take up less electricity.


Storage – The storage of NFTs which consists of Digital Art can be stored on its blockchain because of their size, that is why the token is a certificate that shows the proof of ownership with a web address where the digital art is, because of the individual function of the NFTs and the artwork it can be easily subject to theft.


Fraud –There have been reported cases of artwork being sold as NFTs without the permission of the artist, like the works of Qing Han who is deceased her identity was assumed by a fraudster, and her works were made available as NFTs.

Since time immemorial barter system gave way to money, now slowly it is giving way to these cryptocurrencies and NFTs. And also this is really not the far-off dream. There are major and minor issues that plague this technology. But with innovative research and bright minds. One can also expect an environment safe and private mode of transactions with NFTs,  Cryptocurrencies as well.

There are many cryptocurrencies that have come into existence. But, NFTs are a part of the Ethereum Cryptocurrency, and know many others have them as well. 


Looks like you understood NFT, Cheers!

source: indexarticle. com

Written by
Rex Baker