Certain developments or trends tend to capture all the attention in a given industry every once in a while. And with the internet, it’s not hard to overhype things that aren’t really exceptional or out of the ordinary. However, a new entity has taken both the blockchain industry and many segments of popular culture by storm – Non fungible Tokens.
To start off, an NFT works on a somewhat complex concept that can confuse even seasoned blockchain enthusiasts. If you’ve heard of Beeple’s ‘The First 5000 Days’ selling for more than $69million as NFT art, it’s surprising but believable. However, when you hear about Twitter CEO Jack Dorsey selling his first-ever tweet on the platform for $2.9million, you start scratching your head.
No worries, though. Today, we’ll take you through what NFT is, how it works, and what it may entail for the future. And that’s a lot to cover, so here’s a quick breakdown of all the areas on NFT we’ll cover.
- What is NFT (A full breakdown)
- How does NFT work? (With Cryptocurrency, Blockchain, etc.)
- What is NFT Art? (NFT Art meaning, how it works, etc.)
- Is NFT Art and NFT market worth it? (For the artist, seller, buyer,)
- How to Create an NFT
- How to Sell NFT Art
- How to Buy NFT Art
- How to Invest in NFT
- What the Future holds for NFT
What is NFT (NFT full form + NFT Meaning)?
NFT Full Form
Firstly, let’s clarify the answer to the question, ‘What does NFT stand for?’ The full form of NFT is, essentially, Non-fungible Tokens.
NFT Meaning (Fungibility Meaning)
The key idea in this term is, non fungible. To call something fungible is to imply that you can replace it with another identical and available item of the same value. So, a $20 bill is fungible in the sense that another $20 bill is just as valuable, or two $10 bills, for that matter.
A non fungible item, on the other hand, means it’s a more or less unique item that you cannot simply replace with another similar item. For instance, your gaming PC, built from scratch, with all its customized features and all your personal files and documents is a non fungible item. No other PC in the world has the same combination of hardware, software, customizations, and personal files that yours has, making it irreplaceable.
Non Fungible Tokens NFTs
Non fungible Tokens can be understood as basic digital assets, which are ‘copies’ of real or tangible objects or instances. They can be sold or bought between two parties online, and they come encoded with the same infrastructure that runs and powers cryptocurrencies – blockchain.
For instance, NFT art is a specific digital copy of real art that people can buy or sell. Whoever buys it now owns this specific copy of the art, even though the original artist or owner will still have the creator’s rights.
This same idea can be applied to music, videos, or even in-game virtual items. So, for people who see a non fungible token merely as crypto art or NFT art, it’s much more than that. And we’ll get into that later too. But for now, let’s understand how
How does NFT work with cryptocurrency? (Are there NFT crypto coins?)
For starters, let’s be clear that non fungible tokens and cryptocurrencies aren’t the same things. Although it has the word ‘token’ in its name, it’s not a virtual currency like Bitcoin (BTC) or Ether (ETH). But they are based on the same underlying mechanism, which is blockchain technology.
Identifying NFT terms (NFT coin, NFT token, etc.)
That’s why it’s common to hear expressions like ‘NFT coin’ or ‘NFT crypto’ even though these terms do not clearly refer to any specific entity. You may also come across references to NFT tokens or NFT crypto prices, but once again, these terms need further clarification for them to make sense.
In fact, the term ‘NFT token’ is, essentially, the last word merely repeated. And the most sense you can make from terms like ‘NFT Cryptos’ is that a non fungible token comes encrypted with blockchain technology.
However, their connection can be understood through the blockchain network. An NFT will be tied to a specific token in the network, which will come with an immutable record. Much like a digital signature of ownership that cannot be changed, the NFT will allow a specific digital asset to exclusively belong to someone. In the case of cryptocurrencies, the same mechanism creates that immutable record. It shows that a transaction has been made where a specific amount of BTC, for instance, has changed ownership.
So, the next time someone asks, ‘What is NFT crypto?’ you can use the insights given here to clarify the matter.
What is NFT Art anyway? (or what is NFT crypto art?)
Now that we have a decent idea of what NFTs are and how they work let’s understand how and why they’re used to buy art and other digital assets.
For simplicity’s sake, we may use NFT art to include other NFT purchases that aren’t necessarily digital drawings or paintings. But for the most part, the NFT art may be a visual or audio asset that you can buy.
Most times, it’ll be a specific copy of the said digital asset (something in virtually unlimited supply).
Let’s take an example here.
Anyone who’s been on the internet for some time has seen the Nyan Cat, an internet video sensation that’s one of the most viewed contents on YouTube. This incredibly addictive, silly, yet engaging video is available as an NFT art, if you can afford it. The copy you buy will solely belong to you, but the original ownership rights will remain with the maker.
As a video on YouTube, you can view, download, or share the Nyan Cat as many times as you want without paying a single cent. So, why would you want to pay $600,000 for a personal copy?
Well, the NFT market is meant to run on the same principles of supply and demand that influence any industry. When there is exclusive ownership of a popular artwork (a specific copy), it creates exclusivity in the NFT marketplace. It creates a limited supply of a digital asset that’s otherwise in unlimited supply. So, it suddenly goes from being free to being a coveted item worth having.
Are NFT Art and Blockchain Art the same?
As far as the term, ‘NFT crypto art’ goes, it’s merely a derivative name that means the same thing. So, whether you call it crypto artwork, blockchain art, or simply, NFT art, they mean any art that’s been sold or purchased via NFTs.
Some people also call them Bitcoin art Dogecoin art, but they can only be casual ways of calling NFT art that’s been bought with Bitcoin or Dogecoin. In most cases, NFTs run on Ethereum’s blockchain. So, you could even call it ‘Ether art’ if that makes sense to your listener. But sticking to ‘NFT art’ may be the safest option for now.
Is NFT Art and NFT market worth it?
For most people who come across the idea of NFT art, one of the first things you consider is whether it’s worthwhile and sustainable. After all, many internet trends and sensations peak and wither off in less than a decade. Plus, blockchain technology is naturally still yet to be established as a mainstream medium of recognizing ownership, making reliable transactions, and ensuring full security the whole item.
Naysayers will maintain that NFTs are merely glorified and commercialized versions of what is already widely available. And even though a piece of NFT art may be unique, you’ll still own limited rights while the creator will still enjoy the original credit (and rightly so).
However, that’s a superficial understanding of what art is and how it should be shared. Today, the world is easily a global village continuously breaking communication and interaction barriers thanks to the internet. And NFT art has the potential to add a tinge of order in this chaos using the unlimited potential of blockchain technology.
How does NFT art help the artist?
NFT art opens up a whole new avenue where the artist or the creator can reach new audiences and clients. And the non fungible tokens work in a way that doesn’t discriminate a lot between a beginner or an established artist. Yes, it helps if you’re already a recognized creator or a well-known artist. Had Van Gogh been alive and here today, he would probably get tired of the billions he’ll receive via NFT art sales.
Wait a minute. If the sold copy already belongs to your buyer, how do you still earn off it? There’s great news here for creators of NFT crypto art. There are optional features that allow you to charge a specific rate every time your crypto art exchanges hands after being bought.
So, as an artist, you can avoid some dreaded marketing roles because your sold NFT art does some of the work for you.
How does NFT art benefit the buyer?
Well, it really goes without saying, but officially owning a copy of your favorite NFT crypto art is certainly something unique. For starters, you get the special right to say this one’s your official copy of your favorite NFT digital art or media.
If you’re still not convinced, consider how a Lebron James dunk sold for more than $200,000 as an NFT art. You can watch the video clip for free on ESPN highlights and NBA clips online. But the man who bought it has his very own copy of Lebron driving the ball through the center and finishing with a power dunk right over the defender. And if that’s not bragging rights, we don’t know what is!
More importantly, if it’s a piece of NFT art made by a talented artist, you’re helping to support and fund real talent out there.
How NFT art will work for sellers and collectors of crypto art
The NFT market is fairly recent compared to other means of trading and exchanges that already exist. This means there’s more to be seen in the future than we have observed so far.
For collectors of exclusive items, there are tons of platforms where you can bid and track the prices of NFT arts that are currently on sale. And no, you don’t use non fungible tokens to buy or sell. But you can use cryptocurrency to pay for the NFT art if the platform or artists accepts it. And for more expensive pieces like the aforementioned Beeple’s piece, you’d be the only one or one of the few who owned such an art.
For speculators, the vagaries in prices and value are yet to be seen. The NFT marketplace is still a dynamic and growing sphere. So, buying a crypto artwork at a specific price and reselling it to a bidder in the future is potentially a profitable exercise. Of course, we’re not recommending it. We’re merely stating that it is physically possible to do it.
How to create an NFT
Creating NFTs or non fungible tokens is arguably the easy part when it comes to this whole process of selling NFTs. Your NFT crypto art can be any creative asset that can be represented as a visible entity in the virtual world. As examples, let’s list some common options here.
- Videos of iconic or eventful moments.
- Artwork of any variety
- Music
- Digital trading cards and other collectibles.
- Real-world assets converted into tokenized digital assets
- Video game items like currency, special items, armors, skins, weapons, etc.
How to create NFT Art
So, when you create one of these digital assets, they become NFT art the moment you make them available on any NFT platforms (explained below). So, NFT crypto art isn’t any different from creating normal artworks or digital creations.
It automatically becomes NFT art when you register on the correct platforms and upload your content in the prescribed manner and format.
In essence, your initial file could be in any standard format. It could be an art image in JPG or PNG, an audio file, a GIF, or even a 3D printing model rendered into NFT.
How to Sell NFT Art
So, once you’ve created the digital artwork that you want to sell, you’ll have to get it on the right platform.
Choosing a Blockchain for NFT art and NFT market
One of the first steps here is to pick a blockchain network through which you want to issue your NFT Art. There are many blockchains available where you can deal in NFTs, but Ethereum is currently leading the pack as the most widely used.
However, alternatives like Flow by Dapper Labs, Binance Smart Chain, EOS, and Tron are all viable options increasing in usage. Regardless of which blockchain you pick, you’ll still get access to a marketplace, relevant wallet/storage services, and their standard NFT token.
How to buy NFT Tokens
Here, you’re not directly buying NFT tokens as much as you’re buying the blockchain’s currency to get access to the wallet and services that support the NFT.
For instance, Ethereum’s NFT standard is the ERC-721. So, if you choose Ethereum, you’ll have to go for a wallet service like Coinbase Wallet, Trust Wallet, etc. Plus, you’ll need real fiat currency to buy about $50 or more worth of Ether (ETH), assuming you’ve chosen Ethereum as your blockchain.
NFT marketplaces
If you’ve picked Ethereum as your chosen blockchain, the NFT marketplaces available may be platforms like OpenSea, Mintable, or Rarible. Platforms like Makersplace lets you create and handle your own NFT art, but you’ll first have to become one of their ‘Listed Artists’ before you can avail of this service.
The overall process is more or less the same on most platforms. There’s usually a button labeled, ‘Create,’ which lets you access your wallet. Then, you click ‘My Collections,’ to open a new window where you can upload the chosen digital asset you want to sell. Here, you may have to assign details like the name, descriptions, etc.
Once these and a few more editing steps are done, you can proceed to the ‘Add New Item’ button. This button will let you, once again, upload the file and add it as an NFT in your collections.
How to Buy NFT
Not all of us are budding artists and creators raring to get our works up for sale. Some of us are appreciators of good art, waiting for the next unique image or design to appear. As an NFT buyer, where to buy NFT art and how to pay for it is a common question among many enthusiasts.
Where to Buy NFT Art
Similar to selling NFTs, buying NFT art also involves choosing an NFT marketplace, a connected wallet, the relevant cryptocurrency, and the availability of said NFT art items.
As far as platforms go, the regular options include Rarible, OpenSea, Foundation, SuperRare, Nifty Gateway, NFT Show, BakerySwap, Axie Marketplace, etc.
But there are platforms that deal with specific niche NFTs like NBA Top Shot. So, if you want to buy the next video of Steph Curry making a buzzer-beater or Lebron making a windmill dunk, you’ll have to sign up to NBA Top Shot.
Where to buy NFT Crypto
You can buy the related cryptocurrency based on the platform you choose. Most platforms will allow you to use fiat currency (USD) to buy the relevant crypto token needed to purchase the NFT.
The main thing here is to know which wallet to use in connection with the platform you want to buy from.
How to Buy NFT Art
If you’ve bought assets online (or anywhere else), you’ll already be familiar with packs and drops. In the NFT market, packs and NFT art drops aren’t uncommon. It’s an almost ruthless but very efficient way of supplying rare and coveted NFT arts to a wide range of buyers. So, in many platforms, you may have to sign up in advance and set reminders or take specific actions that let you stake on your favorite NFT.
Once you’ve settled on a collection or item, making the purchase is a simple affair. It’s no different from the way you would make an online transaction for any other e-commerce purchase.
Just click the relevant buttons (‘Buy’, ‘Checkout’, ‘Pay Now’, etc.) and wait for your crypto or currency transaction to take place. But there’s a small fee you may have to pay to Ethereum or the relevant blockchain as part of the transaction fees.
How to Invest in NFT
Investing in NFTs is a slightly tricky subject because they’re not liquid tokens publicly traded in exchanges. Also, their valuation is another complicated affair owing to their diverse and contrasting nature (Eg. The Lebron video vs. the Nyan Cat Gif). These changing and unique value drivers make it a difficult arena for both new and seasoned traders to strike gold easily.
However, if you can study the trends carefully and make the right calculated risks, there is a lot to be gained. Like most new industries, the risk for NFT investors is higher than others, but the payout is also potentially higher in the NFT niche. So, it’s certainly a dilemma worth exploring further.
The intricacies of how to invest in NFT are too detailed to be diving into here. But we’ll provide you with a dedicated guide on the investment aspect.
For newer investors, it may not be the best choice to dive head-first into a specific NFT or platform at the moment. But getting some investments into the infrastructure that holds these NFTs and platforms may make more sense. And for that, you have a wide variety of exchanges and trading platforms to choose from.
What is an NFT Future that is likely Tomorrow?
As with any new technology and industry, there are no NFT artworks or platforms that are guaranteed to stand the test of time. And we do not wish to make unfounded speculations that will lead you, our readers, in the wrong direction.
However, having the right insights and understanding of NFT is the right place to start. Regardless of whether you’re an artist, enthusiast, seller, buyer, investor, or simply someone interested in this new trend, you’ll find all the relevant updates, guides, tutorials, and resources here.
NFT, for now, looks like a revolutionary entity that will unite the creative world and popular culture with financial technology and blockchain infrastructure. For any new trend, that’s quite a powerful combination of industries.
Whether or not NFTs will succeed as a focal point remains to be seen. But whether or not it does, you’ll hear about it first from us!