What are NFTs & How does an NFT work 2022

NFTs: More Than An Artistic Phenomenon

The evolution of the crypto world has brought with it a series of terms and words that many are still unfamiliar with, and one of the most heard during the last few months has been NFTs. On this occasion, we will not only define what NFTs are but also explain every relevant aspect of them.

 

What are NFTs?

It is necessary to know that NFT is an abbreviation of “Non Fungible Token” or non fungible asset. Basically, this means that it is a type of good, product, or digital work that cannot be modified or exchanged for another one like it since it is impossible to create more than 2. It is worth noting that there are currently many types of NFTs; from video game characters to digital art, they can be non-fungible tokens. And these can also be considered a certificate of ownership since the holding validates that only one person in the world owns works or other unique art in a given virtual ecosystem.

 

Example: A house could be an example of an NFT since it is unique and there are no 2 alike. This also applies with arts or songs, such as the Mona Lista, Salvator Mundi, or others. And as mentioned, the difference is that NFTs are virtual arts, while the others are physical.

what are NFTs

How does an NFT work?

To understand how NFTs or non-fungible tokens work, it is necessary to point out that they have a feature close to conventional cryptocurrencies. Since they are hosted on a blockchain. In addition, they also use smart contracts. Therefore, NFTs can establish parameters to certify ownership, such as the name of the creator, and date of creation, among other data.

 

Thanks to this, it is possible to tokenize any type of file and create an NFT. Just add it to the blockchain, and that’s it. It is possible to tokenize from digital artwork to memes, illustrations, and many others. Its function is to guarantee the originality of an asset-based on the added data that certifies its ownership.

 

On the other hand, like cryptocurrencies, non-fungible tokens need a marketplace in which they can be traded. These platforms generally operate with the Ethereum cryptocurrency or USDT. However, in exceptional cases, such as Axie Infinity, those wishing to buy an NFT from the video game must register to trade on the game’s marketplace.

 

NFT crypto

Although NFTs have several similarities with cryptocurrencies, they also have many differences, the first of which is that no more than 1 NFT can be generated in the same way. Let’s remember that each piece is original, unique, and based on different smart contracts, except in some cases.

 

In addition, another notable difference between cryptocurrencies and non-fungible tokens is that the latter cannot be mined under any circumstances. Because their creation is done by a person who tokenizes a specific work, let us also remember that cryptocurrencies are used as virtual currency. Whereas non fungible assets are simply digital art. And to conclude, NFTs cannot be divided in half, and only a part of them can be sold, a fact that is possible with cryptocurrencies.

non fungible tokens

 

What is NFT digital art?

NFT artworks are created by artists and sold to collectors. They are like paintings or sculptures, except that they exist exclusively in the digital realm. Musician Grimes is one of many artists who have recently made a pretty penny from NFT art. After putting a series of 10 pieces created in collaboration with her brother, Mac Boucher, up for auction, some unique and others with thousands of copies, she made over $6 million.

 

Of the art she sold from their “War Nymph” collection, the top-selling piece consisted of a cross, sword, and flying cherubs covered with an original song by Grimes herself. The total price? 389,000 for the piece entitled “Death of the Old.” Beeple, whose real name is Mike Winkelmann, is a creator of NFT digital art. He has partnered with Nifty Gateway in the past and sold $3.5 million worth of art. Grimes has also partnered with them, in addition to WayNymph, to promote his album.

 

Christie’s, an auction house, recently launched its first digital art sale, where it sold a collage of 5,000 photos of Beeple. It’s a work of art that exists only as an NFT. So far, the highest bid is at $3 million, with the sale set to close on March 11. “We are in very uncharted territory. In the first 10 minutes of the auction, we had more than 100 bids from 21 bidders, and we were at $1 million,” said Noah Davis, Christie’s post-war and contemporary art specialist.

 

NFT art

Any image, video, audio, text, or tablet file can be assigned an identifier that records the author’s name, initial value, and sales history, among other metadata. This non-fungible asset (i.e., an asset that cannot be duplicated, consumed by use, or replaced by something else) has created a fever this year in the form of crypto-art.

 

“In the art world, the value of a work of art lies in its uniqueness. The art market has adapted to the evolution of technology, so there are now digital works of art. How can we guarantee that a file is unique and special and that there are not thousands of similar files? That’s where the NFTs come in, from Roman law: they are unique and indivisible goods”.

 

As a result, crypto-art is growing rapidly, and more and more digital artists are making a name for themselves and selling their work for millions of dollars. This is the case with the artist known as Beeple, who sold his work every day for $69 million. The case of the Bored Ape Yacht Club avatars, a limited NFT collection of 10,000 monkey avatars that generated multi-million dollar sales, also revolutionized the market.

 

NFT Art Finance

NFT Art Finance was launched in 2021 with the aim of facilitating trade with NFTs, especially for artists: the Non-Fungible Token (NFT) is a kind of digital property certificate that can feed the art market channels and thus reap the benefits of digital art. It is possible to convert classic works of art into NFT on the enter art gallery and music tracks with the enter audio service on the platform. Interested customers can then acquire the corresponding NFT.

 

At the same time, investors can execute targeted transactions with the Art Finance NFT tokens (NFTART). These tokens are unique in that they declare ownership of a work of art and can also be bought and sold like other cryptocurrencies. Each transaction involving an NFTART is subject to a 10 percent tax: five percent of them are burned, and five percent go back to the respective owners of the token. Thus, NFTART not only earns passive income for artists and merchants, but the tokens are also anti-inflationary.

 

NFT and video games

Another relationship with NFTs in the metaverse has been much talked about in the media since Mark Zuckerberg’s company changed its name to “Meta.” Both NFTs, as well as the metaverse, are interlinked, especially in cryptocurrency games. NFT or “play-to-earn” games are games in which some of their parts are NFT. The non-fungible tokens in the game can be a character, weapons, housing, vehicles, etc.

 

Interestingly, the purchase of in-game NFT is done through the game’s own cryptocurrency, so the more popular the video game is, the more users will play it and buy NFT, which will increase the value of the currency. In this way, you can also earn money with NFT games because by completing certain missions, defeating enemies, or fulfilling requirements, you can earn the game’s cryptocurrencies, which you can exchange for real money.

 

What is OpenSea?

OpenSea is a decentralized Marketplace whose specialization has to do with the trading of NFTs. This platform was founded at the end of 2017, all under the premise that it would serve as the Amazon of digital assets. Since then, the catalog and exposure of this platform have done nothing but grow, positioning itself at a certain point as a leader in the NFTs sales market.

 

It is possible to find up to 200 different categories of NFTs easily and more than 20 million collectible assets. Its interface is based on blockchain technology, specifically on the Ethereum network, which gives it the security that characterizes it so much. In this sense, its operation is similar to that of a cryptocurrency Exchange account, where it is necessary to use a wallet or digital wallet. We can say that it is a fairly simple and intuitive platform.

Tory Lanez NFT

 

Tory Lanez NFT

Indeed, the Canadian rapper managed to win a million dollars in less than a minute, thanks to a surprising process. Tory Lanez has had a tough time in the last year. Suspected of shooting Megan Thee Stallion, the artist faced a very heavy prison sentence. However, it seems that Tory Lanez turned the tables and managed to earn millions of dollars in a few minutes. But how did he do it? It’s “very simple.” It’s the result of his initiative to sell millions of copies of an exclusive album in dematerialized form through the NFT called “When It’s Dark.”

 

These were sold for $1. The objective was to allow buyers to be able to resell these projects at a higher price to those who wanted to. He had already done this a few days earlier by selling singles in this way for $700. Those who owned them were able to resell them for up to $32,000.

 

VeVe NFT

First released back in December 2020, VeVe serves as a platform that enables people across the globe to buy, sell, and exchange their digital collectibles as well as explore other potential opportunities in the virtual world. This was formerly also known as ECOMI Collect and eventually developed into a new platform referred to as VeVe. In addition to being merely another marketplace, this application presents itself as offering a variety of additional functionalities.

 

You can actually physically scan your local area and then simply click on your phone to place your desired piece of digital collectibles anywhere on any flat surface using their AR feature. Afterwards, it is possible to scale, move and/or rotate the items you collect as well as send them via mobile text message to all of your family members and friends, as well as publish the items on any social network you like.

 

Ex-First Lady Melania Trump is now involved in NFTs

Melania Trump’s foray into the NFT front is far from a smooth ride. After unveiling a first project on Solana in mid-December, Donald Trump’s wife had quickly been “reframed” by representatives of the blockchain. A “clarification” in due form. “I wanted to inform you, to avoid any confusion, that his choice to use the Solana blockchain is completely personal and that this project is not part of any initiative led by Solana,” had insisted, at the time, to clarify a spokesman for Solana.

 

This first NFT stamped Melania Trump was none other than a watercolor representing “her cobalt blue eyes” and soberly entitled “Melania’s Vision”. A digital work produced by the French artist Marc-Antoine Coulon, an illustrator who has collaborated with publications such as Vogue, Elle or Vanity Fair. The watercolor was also accompanied by an audio “message of peace” recorded by the former First Lady herself. A first sale that went off without a hitch.

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