So what are NFTs anyway?

Banksy art burned, destroyed and sold as token - Image: BBC

Unless you’ve been living under a rock, we’re sure you’ve heard about NFTs. from Grimes, to Christie’s, to the NBA and even Banksy, this new crypto-trend is the hottest topic in the digital space right now. but what are NFTs anyway?

Short for Non-Fungible Token, a NFT is the registration of ownership of a digital object on a blockchain — it can be any type of media including but not limited to art, videos, music, gifs, games, text and memes. the non-fungible part means the object is unique, making it irreplaceable. ‘For example, a bitcoin is fungible — trade one for another bitcoin, and you’ll have exactly the same thing,’ explains The Verge. ‘a one-of-a-kind trading card, however, is non-fungible. If you traded it for a different card, you’d have something completely different.’ In short, NFTs help prove authenticity and ownership, powering the emerging economy of digital collectibles and virtual goods.

So why all the fuss around them? NFTs are proving to be a catalyst in the transformation of the economics of creative activities, allowing creators to monetize directly with their fans. being able to create artworks on the blockchain as NFTs means an artist’s content can be sold globally on decentralized marketplaces. as if that wasn’t enough, NFTs also have a feature that pays the artist a percentage every time the NFT is sold or changes owner.

By now you may be wondering why would you want to buy something anyone can enjoy for free. the answer is simple: ‘anyone can see pictures on the internet of the most expensive artworks; posters are sold in museums,’ Vincent Harrison, a New York gallerist told Wired. ‘but it’s the ownership that creates value. so with NFTs, not only do you have ownership, you have ownership on the blockchain, you have ownership that is transparent for everyone to see.’

In the past couple of weeks a video by Beeple sold for $6.6 million, someone paid $3,600 for a Gucci Ghost GIF, and a collection of digital furniture by Andrés Reisinger made $450,000 in less than 10 minutes. but NFTs have been around for quite a while, having one of their first booms in 2017 with the Cryptokitties, one of the world’s first blockchain games operating on ethereum’s underlying blockchain network. Today, some of these virtual kittens are on sale and can go up to $1 million.

So where should you look for NFTs? Check out OpenSea, Rarible, and Nifty Gateway, where Grimes sold her digital art collection.

‘Non-Fungible Tokens and the digital goods and collectibles they enable will play a major role in the next era of the digital economy,’ said said Tyler Winklevoss, CEO of Gemini, who acquired Nifty Gateway in 2019. ‘They are the perfect form factor for crypto-collectibles, crypto-art, and much more – laying the foundation for entirely new multi-billion dollar industries to emerge.

Author: Juliana Neira I Designboom