WHAT ARE NFTs?
These are unique digital assets which is stored on a blockchain representing ownership of an item such as digital art, music, video, virtual real estate, etc.
NFTs are also known as Non Fungible Token. “Non Fungible” means being special and cannot be replaced with something else. Crypto currencies like Bitcoin or Ethereum can be exchanged whereas NFTs are one-of-a-kind digital asset.
3 OUTSTANDING COMPONENTS OF AN NFT:
1. Token ID: This is a unique identifier which is assigned to each NFT to make it different from others.
2. Smart contracts: These are automated programs that govern the rules of an NFT. These may include royalties, transfer conditions, etc.
3. Metadata: Information about the NFT such as its image, file or video.
5 TYPES/GROUPS OF NFTs.
These are many but let’s discuss five of them.
1. Music: Here, artists sell exclusive music files as NFTs.
2. Art: Digital paintings, illustrations and animations are sold as NFT.
3. Video: Video clips in sport, etc are sold.
4. Virtual real estate: Plot of lands in the metaverse (e.g, Decentraland, the Sandbox).
5. Collectibles: Digital trading cards and other rare items.
5 REASONS FOR BUYING NFTs.
These reasons differ from different people’s perspectives.
1. Buying NFTs makes you a digital owner of a unique item and shows proof of authenticity.
2. They help in investment as some NFTs increase in value over time, yielding more interest.
3. Most NFTs unlocks exclusive content, in-game benefits and membership.
4. Enables artists to sell directly to fans without intermediaries. This fosters support for creators, too.
5. Being an owner of any rare or expensive NFT can boost social reputation.
STEPS TO BUY AND SELL NFTs.
1. Get a Crypto wallet, preferably Trust wallet, Coinbase wallet or Metamask.
2. Fund your wallet.
3. Choose an NFT marketplace e.g Foundation, magic Eden, open sea, etc.
4. Make your research and make purchases. Find an NFT and buy it using your crypto wallet.
5. Upload your artwork, music, video or any type of NFT on an NFT platform.
6. Input your price.
7. List for sale. Once listed, buyers will be able to purchase it using cryptocurrency.
RISKS AND CHALLENGES OF NFTs:
1. Market instability: Prices can always fluctuate.
2. Fake NFTs, rug pulls and scams/fraud exist.
3. Legal issues: This can be seen in copyright and intellectual property disputes.
4. Some NFTs may be hard to sell.
DOES NFTs HAVE FUTURE?
Oh yes!… NFTs are evolving beyond art and collectibles. Some trends record that in the music and entertainment section, more musicians and filmmakers will use NFTs for direct sales.
In the metaverse and virtual reality, NFTs will play a key role in digital ownership in virtual worlds.
In the real world application, it’s very possible that NFTs can be used for event tickets, identity verification, medical records and real estate.
How about in Web 3.0, decentralized application and fractional ownership? _ People can own shares of these expensive NFTs and they will integrate deeper into Blockchain apps.
ARE THEY WORTH IT?
Well… NFTs are revolutionizing digital ownership but are speculative and risky. If you are interested in them, make thorough research and approach with caution. Artists, investors, gamers and you have the potential to shape the future of digital assets.
Any body from anywhere can own and particular in this NFTs. There is no age restriction nor limitations to the thrown of ownership. Digital assets can be easily gotten from a good investment in NFT.
Your skill can be sold out or traded, same as your products.
Anything that can be seen or heard but so far as it benefits the market, adds value or solve a problem – you are good to go.
Traders, developers, writers, teachers, ambassadors and many unique personalities are welcome to the palace of ownership through NFT.
