Over the past year social media has been swarming with celebrities, content creators, and influencers promoting, purchasing, and producing NFTs. It has left many of us wondering what an NFT is about.
An NFT is a non-fungible token, which means that it is unique and cannot be replaced with something else. NFTs are fairly common. A cool example of an NFT is when you use v-bucks to purchase a Fortnite skin; that skin is a form of an NFT. An NFT is a digital asset that replicates or represents art, music, videos, sneakers, GIFs, and more. Pretty much anything digital can be sold as an NFT.
NFTs operate through the Ethereum blockchain, which is a platform that establishes a network to securely execute what is called a smart contract. As a result, most NFT purchases require the buyer to obtain Ethereum’s currency to complete transactions.
Buying and selling NFT’s can be considered digital collecting and reselling. Historically people collect paintings, sports and game cards, cars, comics, signed sports paraphernalia, shoes, clothing, and more. Multiple factors like condition, model, edition, uniqueness, and year all play a part in the value of the collectible item. The same can be said about NFT’s, but there’s only one owner at a time of a digital asset. NFTs value come from the availability and the uniqueness.