If the idea of NFTs has put your brain into a tizzy – do not fret. We have gone ahead and done a little digging for you. We break down the latest cryptocurrency rage – what it is and whether it lives up to the hype.
NFT is short for a non-fungible token – unique digital objects or artwork that are a type of cryptocurrency. Remember when kids traded baseball cards or even funky 45 RPMs? Think of NFTs as the ‘cool’ (albeit digital) collectibles of our time spanning various areas – especially music, gaming, and art.
‘Fungible’ refers to currency tokens containing the same value. On the other hand, non-fungible tokens are wholly unique and impossible to replicate. This explains their particular appeal to the arts, sports, and gaming worlds – the epicenters of the current NFT hysteria.
Most NFT creation and trading take place on the Ethereum blockchain. The NFT you buy is unique and viewable to everyone on the platform. Nobody can claim ownership of your NFT or attempt to replicate it. In essence, you own an object which is one-of-a-kind.
NFTs traditionally present themselves as digital art, such as images. The value is not in the picture or image – which anyone can copy. The value lies in their existence as a unique object on the blockchain.
Most importantly, the NFT has intrinsic value for collectors – not just to make money later (although that is the ultimate hope) but because you love the object. Think official NFTs for basketball fans or rare items related to online games.
Digital collectibles and artwork are all the rage today. NFTs have a large following among enthusiasts wishing to own unique objects that they find interesting. Like traditional artwork, NFTs have the potential to become immensely valuable in time. Investors can make money through NFTs. But, like any investment, you will need to do your homework.