NFT is a digital equivalent of a physical collectible item.
What is NFT
NFT is a digital equivalent of a physical collectible item that can be a sports card or an artwork. It represents a unique digital asset whose identity including: original creator, selling/payment information and buyer (current owner), can be authenticated and stored on a blockchain technology platform.
NFT is abbreviation for “non fungible token”. Fungible means the item can be exchanged like-for-like. For example, if you have five $20 bills, you can go to a bank and exchange those for $100 bill. Conversely, non-fungible means that item is unique. An example of such unique items can be a sports card or an artwork.
Famous NFT cases
There have been some high profile NFT cases: Lebron James dunking video sold for $208,000, Beeple sold his digital artwork for $70 million and Twitter CEO Dorsey 1st tweet sold for about $3 million.
Why is it gaining popularity
NFT has grown in popularity lately for variety of reasons. People genuinely supporting artists, art collectors who wants to own digital artwork, crypto bulls advancing crypto currency eco-system, or maybe some people having too much money and thus using it for pure speculation. Additionally, a physical artwork may get damaged or stolen, but digital artwork is preserved on internet forever.
Skepticism about NFT
Despite all the recent euphoria, there is healthy skepticism about NFT. When you buy a digital artwork as an NFT, you cannot physically keep it or touch it as it is stored digitally on internet. You may not necessarily “own” it, as you may have to pay royalty to the original creator if you sell it. You may “own” the asset but that does not prevent other people from copying them. Additionally, you may have to trade an NFT using crypto currencies with potential hidden fees.
How do I trade NFTs
If you want to buy or sell NFTs, you can do that by creating account on NFT marketplaces like NBA Top Shot, Mintable or OpenSea. Remember that you may have to trade using cryptocurrency, bid in an online auction and pay transaction fees.
Final Verdict
If you do decide to buy NFT, make sure you truly understand what you are getting into. Are you speculating, doing it for fun or serious about owning digital artwork. Perform your own due diligence before venturing in the NFT world!
We hope the information in this post will be helpful in your journey of aspiring nirvana!