What Is NFT? Everything You Need To Know About Fungible Token
Are You A Digital Creator? Want To Sell Your Products Online? Then You Need To Know About Non Fungible Token !!
Some Experts believe that NFTs have some dark facts while others say that they will change investing forever. Let’s see both the advantages & disadvantages of the whole concept in this post.
What Is Non Fungible Token?
NFTs represent ownership of unique items like art, collectibles, even real estate. They can only have one official owner at a time and they are secured by the Ethereum blockchain. No one can modify the record of ownership or copy/paste a new NFT into existence.
An NFT is created from digital objects that represent both tangible and intangible items, including:
• Videos and sports highlights
• Virtual avatars and video game skins
• Designer sneakers
Even tweets count. Twitter co-founder Jack Dorsey sold his first ever tweet as an NFT for more than $2.9 million.
How Is NFT Different From Cryptocurrency?
NFTs do not innately possess monetary value. Their existence is representative of items with varying monetary values instead. Such as art, songs, property, etc. This makes them economically non-fungible.
Where as Physical money and crypto currencies are “fungible,” meaning they can be traded or exchanged for one another.
Advantages & Disadvantages Of Non Fungible Tokens
Non-Fungible Tokens have become extremely popular in recent times especially during the COVID-19 epidemic.
Let us know few benefits and potential drawbacks of NFTs.
The following are the some advantages that collectors can have when purchasing non-fungible digital artwork.
1. Increase In Market Value
Just like any other tokens, Non Fungible Tokens have possibility of your money growing in value when you acquire them.
According to a report from blockchain specialist Chainalysis, $40.9 billion was spent on NFTs last year. The equivalent of $40.9 billion was spent on non-fungible tokens (NFTs) in 2021, almost unreal growth for an industry that generated barely a billion in 2020.
2. Licensing Digital Creations
The process of turning a digital file such as an image, art or video clip into an NTF is a process of fundamentally licensing it for authenticity and ownership
NFTs cannot be easily duplicated or endlessly copied. There is a distinct value attached to each of them because each non-fungible token exists on a decentralized and public digital ledger based on a blockchain technology.
3. Profiting From Digital Assets
Monetization is another possible advantage of NFT. Turning digital items into digital assets is a method of assigning them a monetary value.
Several internet memes have also been turned into digital assets. And, creators are really making a millions of profits in the internet through NFTs.
4. Data Record
In general, maintaining records of authenticity and chain-of-ownership for priceless artwork appears to be difficult at times.
As, NFTs exist on the blockchain, there are clear ownership records for all of them, which means your digital artwork should never be stolen or its legitimacy questioned.
There are few disadvantages of Non Fungible Tokens where creators or buyers or investors must know before investing here.
1. NFT Hype & Concerns Over Uncertainty
Of course, several non-fungible tokens have proven their value and growth potential. However, the ongoing craze toward purchasing these assets has prompted several experts to compare the phenomenon to dot-com bubble of late 1990s and other similar events.
2. Environmental Expense
Any record added to the Ethereum blockchain necessitates a considerable amount of compute, which consumes a large amount of energy.
As a result, broad trading in NFTs and other blockchain-based assets isn’t always a green process.
Below are the few examples how people are benefiting from NFTs. Hope these examples inspires the digital creators and give them a new scope.
1. A teenager built an NFT collection valued at more than $26 million in one year.
2. Twitter CEO Jack Dorsey’s first ever tweet was sold for $2.9 Millions as an NFT
3. Cricket icon Sreesanth is gearing up to release a gamified NFT collection on Blind Boxes
4. Indonesian Student’s selfies rake in US $1 Million in NFT sales
5. Beeple’s Everydays – A collage of digital art NFT that was sold sold for $69 Million on October 2021.
Finally we need to conclude that, NFTs are really creating great earning possibilities for the digital creators!!
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