The cryptocurrency news has been shining with new headlines since February. But this time, record-hitting prices of bitcoin have nothing to do with it. It’s all about NFTs – the new hottest term in the crypto world. NFT stands for non-fungible tokens, but what is it actually, and how it became so popular?
NFT is a type of cryptographic token created for proving the authenticity or ownership of something that can be both physical or non-physical. This works like blockchain technology that is used for financial transactions. But the difference is that NFT represents a unique asset which means that it cannot be duplicated or swapped with anything else.
Cryptocurrencies are usually fungible – this means that, for example, one Bitcoin can be exchanged with another one Bitcoin. It also means that all tokens are equal, which is imperative for their free exchange.
In contrast to fungible tokens, NFTs are unique. Suppose we must create digital assets for Bitcoin, while each asset must have a unique identifier that would make it different from others, thus proving the ownership or the authenticity of it. In the same way, you can tokenize your physical or digital artwork creating its NFT. NFTs also solve the problem of reproducing digital objects as it creates scarcity for that object.
Though NFTs have become popular recently, the first of their kind non-fungible tokens were “Coloured Coins” that hit the market in 2012. Another NFT that created a bubble period in the crypto world was the “Cryptokitties” game. The project allowed people to buy and sell digital cartoon cats with ownership-verifying NFTs.
Today NFTs became so popular that it’s hard to find anything that cannot be sold as an NFT. One of the famous funny examples is the NFT of Twitter CEO Jack Dorsey’s first tweet that says, “just setting up my twttr.” It was sold on March 22 for almost $3 million, which Jack donated to charity.
just setting up my twttr
— jack (@jack) March 21, 2006
Perhaps the most useful digital type of art that can be used as NFTs is the GIFs market. By all opinions, NFTs can make the GIF market an actual marketplace. This could be a great solution to the current ‘problem’ of selling GIFs online.
Another famous example is Elon Musk’s girlfriend, musician Grimes, who sold the NFT of her 4 artworks worth $6 million in just twenty minutes. A percentage of the proceeds from her collection’s NFT sales will be donated to an NGO concerned with reducing carbon dioxide emissions.
How to buy NFTs?
Well, you already know what NFT is, how it works, and get interested in that crazy business; your next question is can I buy NFTs and how? It’s the same as virtual shopping.
First of all, you enter the marketplace where NFTs of various digital art pieces are sold and browse to find your favorite. In many cases, you must participate in an auction, bid the price, and hope you will win. At the same time, other marketplaces offer to buy NFTs instantly for a set price.
But before coming to the buying process, you need some steps to do – starting with a digital wallet creation. For this purpose, you can use MetaMusk digital wallet, set it up, create your wallet, then add money to eat so that you can buy Ether and then use it for buying tokens.
Here is a list of famous marketplaces where you can browse and buy or sell NFTs:
What are the most popular NFTs?
Several various projects use NFTs as collectible and tradable items. You can follow their price, volume, and other statistics on OpenSea where they are updated hourly. Now let’s get introduced to some of the most popular ones.
Nyan Cat is one of the most popular and maybe one of the most meaningless NFTs ever. This pixelated cat’s video became famous nearly 10 years ago. Now it has over 200 million views on Youtube. Its owner created an NFT for the cat and sold it for 800 ethereum, equal to $531 000.
The CryptoPanks is another successful tokenized project which introduced 10 000 uniquely generated characters that became claimed very quickly.
Another major project – Decentraland represents a virtual reality, where users can own and exchange pieces of virtual land and other in-game NFT items.
Gods Unchained is a collectible card game where each card is issued as NFT. So, players can buy and sell them easily as they would do with a physical card since the NFT of each card proves that it’s unique.
Other famous NFT projects include Sorare, My Crypto Heroes, Crypto Stamps, Hashmasks, MyNeighbourAlice, etc.