Do you understand NFTs?
Eversince the introduction of Web 3.0 into the tech space, NFTs have been the most popular word in the mouths of people. But many people today are not aware of what NFTs are. What about you? Do you know what NFTs are? If you are among those who do not know what NFTs are then you are in the right place and at the right time.
Let us try to explain the English concept of NFTs by taking each word at a time.
What is Non-Fungible?
What is Fungible? First let us take fungible according to the Merriam Webster dictionary. Fungible is said to be the being of something to be able to be replaced. That is one part or all of it can be replaced completely with something identical and of the same value.
Take for example you find yourself in a love circle with your significant other who has been everything to you with some other person who you may or may not even know. And you are asked to let go of your significant other and choose one out of them all who can and should replace your bestie. I am sure this will be a very tough task and a completely impossible one because no two persons are exactly identical even biology says that no two persons are exactly the same. it is impossible!
But when you go to a shoe factory where shoes are mass produced with the same measurements, designs making them identical you can always buy two or more of the same shoes for your twins and they will be able to interchange them without even knowing.
Do you understand ‘Non-fungible’ now?
With the illustrations above I did say that NON-FUNGIBLE means something that does not have the same value. This is not identical and can not be replaceable.
Diving in deeper, having fungible goods is like in the 80’s where stones were used in exchange for goods and services. Example when an Australian man comes to South Africa to render a technical service to a company that in return pays him with a precious stone diamond. The australian man travels back and sees the need to buy materials from his South African counterpart and returns with a diamond having an australian origin. The South African man will gratefully take his pay without bothering if it will be of use to him in his own country. This is because the Australian and South African diamonds are all identical of the same value and as such interchangeable.
Another example of a non-fungible token or product is a house, the house of Nicki Minaj cannot be identically replaced to that of Otedola’s mansion. They both have different features this is what non-fungible is. Non-fungibility simply is uniqueness. Why an art work is non fungible is because it is solely and completely unique with each artist. Art is an inspiration and how this individual sees and communicates an idea is completely different from another artist.
Now that you have understood what a non-fungible means, let me take you through understanding what a token means and is.
What is a token?
A token is simply something that represents another object. More relatable is when your significant other gives you a gift as a token i.e. a symbol of their love for you. That gift is known or seen as a token(symbol) of their love for you.
Now, putting all these explanations together, NFTs also known as non-fungible tokens are understood as digitals asset that are traded on the blockchain system whereby a certificate of ownership is given to the buyer of the digital asset.
HOW DO NFTs WORK?
NFTS are tokens used to exchange digital products whereby a certificate of ownership is given to the buyer. This certificate most times does not transfer the copyright of the product.The idea is that you can buy an art work as a digital file. Do you see that?
How are NFTs Different from Cryptocurrencies?
Although Nfts or non-fungible tokens are like cryptocurrency tokens such as bitcoin and ethereum, the simple difference is that they are not interchangeable. This is it, let us say you have 2 units of ethereum coin and I have the same 2 units as you, it means we have the same value of coins. This is unlike NFTs that are unique to their origin. To be more vivid, no two persons can own a particular non fungible token.
What are the importance of NFTs to Artworks?
Talented artists make their art drawings and use technologies to convert into digital products where people can pay to gain ownership of them in exchange for cryptocurrencies. The ether is an ethereum based page that allows for the sales of NFTs.
With this both known and unknown artists can mint their works to a larger community of the world in as little time as possible. Sometimes they sell these works on bids, that is the individual with the highest bid gets a certificate of ownership to the artwork known as NFT.
THE most intriguing aspect of NFT is that basically anyone can make money from it with just doing what you have previously done. But then leveraging digital technology and as such convert them into digital tokens which are then traded upon. A talented kid artist can make wonderful drawings and trade them for cryptocurrencies without requiring an art gallery to display its artworks. This is cool right?
Also non-famous artists with great art works can be known through trading NFT. Without referral!
HOW DOES AN ARTWORK BECOMES AN NFT?
An art work becomes non-fungible to you when a certification of ownership is given to you who purchased the artwork.
So many NFTs are coming up, one is of a student who became a millionare selling his daily selfies for over 3years as NFTs.
Another person cashing out from NFT is a TikTok star who sells her farts on jars and has started making money selling her farts as NFT also known as fartpreneur. This is crazy right?
What are Nfts File System?
Researches from ‘Proderivatives’ have revealed that it takes about $1.68million to store an NFT on a blockchain. This protects it from hackers and expiring. Well, due to the high cost it takes to put an NFT on a blockchain NFT generators opted to use url to save their digital products. This is highly prone to hacking and expires too.
This led to the development of the NFT file system which is a solution to the NFTs error issues. It is called an InterPlanetary File System (IPFS). It works such that a content ID is created when an NFT is uploaded to the NFTs file system. The content ID is then used to source the NFTs while securing it.
What are NFT stocks?
NFT stocks are stocks that are particular to one person which can not be changed for the other. Example a tesla stock bought can not be interchanged with an amazon stock.
HOW DO I BUY NFTs?
Do you want to know how to buy an NFTs? Because NFTs are bought using cryptocurrencies you must first get
- A crypto wallet; but you must know the best cryptocurrency to get because there are countless cryptocurrencies out there which may not be useful at all.
- Then you visit the websites of these popular Rarible, OpenSea.io sollet.io, NFTs marketplace or download their app and follow the instructions provided.
What are the 3 steps to create and sell NFT?
- take a picture of the product you want to become a digital asset.
- upload it here
- It is coded and the codes are specific to your uploads so anyone who buys it buys the unique code.
Are NFTs Bad For The Environment?
Every NFT is built on blockchain like ethereum. So the energy it takes to mine on this platform releases tons of carbon energy which are supposedly harmful to the ecosystem.
This has been a long and useful read. By now you understand what NFTs are. If you have a question, leave a comment in the comment box and we will get back to you.
NFTs also known as non-fungible tokens are understood as digitals asset that are traded on the blockchain system whereby a certificate of ownership is given to the buyer of the digital asset.
NFTS are tokens used to exchange digital products whereby a certificate of ownership is given to the buyer.
Although Nfts or non-fungible tokens are like cryptocurrency tokens such as bitcoin and ethereum, the simple difference is that they are not interchangeable.
1. take a picture of the product you want to become a digital asset…
