NFTs are the new buzz in the Cryptocurrency world. It is trending globally as many famous personalities were used these crypto tokens to linked their valuable assets and selling those assets for millions of dollars. This has led to an increase in total market capitalization of over 300 million dollars.
- What are NFTs?
A non-fungible token (NFT) is a special type of cryptographic token which represents something unique. This is one of the Blockchain Technology with unique attributes. NFTs are kept in the same blockchain logs as a cryptocurrency called Ethereum.
NFTs are called non-fungible because they are not mutually interchangeable since they contain unique information, although it is possible to mint any number of NFTs representing the same object.
- How exactly NFTs work?
NFTs are like digital certificates that are cryptographically verified and secured with Blockchain Technology. These can be bought or sold just like any other cryptocurrency but these are unique and cannot be replicated.
It is like Artwork that has an owner and having ownership of that particular asset is resided by the creator of that NFT.
These Tokens are stored in an encrypted peer-to-peer network which makes him difficult to hack or damage by external means such as cybercriminals, etc.
Characteristics of NFTs :
- Non-Interoperable
- Indestructible
- Verifiable
- Unique
- Easily Transferable
- Why NFTs is so trending these days?
As market speculative with NFTs and investors wants to invest in these tokens nowadays. These can be recorded as digital art and can be auctioned later.
These can be used as collectible items which can attract crypto investors and may rising the pricing NFTs in the future.
In recently, Twitter co-founder and CEO Jack Dorsey announced he will auction his first tweet and convert it into NFT as the digital signature. He’ll donate the amount generated from the auction directly to NGO charity.
Last year also, Christie’s New York made history by selling first-ever physical artwork i.e. linked with NFTs. The famous London Artist Benjamin Gentilli sold his artwork for over 130,000 US Dollars.
This increases the popularity of NFTs in the cryptocurrency world.
- Are NFT's are new in the market?
NFT’s are around for almost a decade. ‘Colored Coins’ are the very first NFTs to exist in the year 2012.
These coins are made of small denominations of a bitcoin and can be as small as a single satoshi, the smallest unit of bitcoin. These coins with metadata are added to them.
As every month some artists, investors, any company invest in these tokens as they reach new heights and NFTs will help in revolutionizing this upcoming cryptocurrency industry
- What Problems are arising with NFTs?
NFT produces carbon emissions, from minting the token to mining the coins used to buy it. Carbon emissions cause big trouble soon as a massive amount of energy will be used in making these NFTs.
Another reason that could cause the problem if proper security hasn’t been taken by the owners of NFT or by the exchanges then it could end up in an empty wallet.
- Will NFTs have a Future?
This buzzing question could live up for quite a time as Blockchain are expensive, slow, and confusing. These NFTs give true digital ownership to individuals or groups of people.
These Tokens are fairly new concepts and this takes some time to get popular. These Tokens are used by different sections of peoples such as Artists as digital art, Sports Personalities as sports memorabilia or autographs, Crypto-investors as crypto coins, etc.
I think NFTs have a bright future ahead as this could be the next boom in the cryptocurrency world.
