About NFT
The topic of our conversation today is NFT and NFT tokens. If you go to the Internet at least once a day and read the news, you must have come across the concept of NFT: “The head of Instagram allowed the integration of NFT into the social network”; “Millions of dollars and dislikes: how NFTs penetrate games with difficulty but inexorably”; “Melania Trump Launches the NFT Market” and similar headlines appear on the Internet a thousand times every day. The word NFT became the most popular in the past year, and the theme was supported by many celebrities. Among them are Elon Musk, Steve Cohen, Twitter founder Jack Dorsey, crypto artist Beeple and others. This list can be continued for a very long time. But do you understand the essence of NFT? Do you know how blockchain works and why people pay millions of dollars for a picture that can be downloaded for free? If not, in this article we will try to figure it out.
What’s NFT meaning?
To begin with, NFT is not just a picture on the Internet that you buy or sell. There are trillions of pictures on the net. Each of them is free to download for free, and no NFT is required here. NFT meaning Non-fungible token, and is a unique certificate of ownership of an image, multimedia object, GIF or video on the Internet. The difference between cryptocurrency and NFT is that each coin has its own fixed value. Any of them can be exchanged for another and then sold for the same cost. At the same time, each NFT is unique and has its own price tag. It is not interchangeable.
How does NFT from the past compare?
Simple analogies. After all this, you might be wondering what makes NFTs so unique then? The answer is simple: people’s desire to be different from each other. The simplest and at the same time the first prototype of NFT appeared back in 2013. He is associated with the Valve Corporation. Do you have any idea what this is about? It was then that skins appeared in the CS:GO game a year after the release. People who have never bought skins can never understand why anyone needs to spend huge amounts of money on pictures drawn on weapons in a video game. Meanwhile, AK-47 StatTrak Howl for $150,000 is considered the most expensive skin. Who bought it and for what purpose is unknown. The same thing happens with NFT, only in a more advanced form: with the addition of a blockchain, certificates, exchangers, but the scheme remains unchanged. If you have friends who play CS:GO, ask them what makes the skins special and you will get an answer to the question of what makes NFTs special.
NFT record holders
Unlike the ancestor, non-fungible tokens have leaped over skins a lot in terms of evolution. Today, the most expensive NFT is the $92 million black and white work of an artist called The Merge. Everydays: the First 5000 Days costs a little less work – $69 million.
I bought an NFT? Do I own it?
A certain curiosity arises when people who bought an NFT picture for personal use think that they have some unique rights to it. No, it doesn’t work that way. For example, a viral video of Nyan Cat was bought by someone for $580,000, but you can still watch it, download it, put it on the desktop background and not wait for a receipt from the owner. If you don’t believe it, try it now. Here it is. Like skins, NFTs are of value to collectors who collect the rights to own rare materials and then sell them for a hefty price. By the way, since 2013, each skin in CS: GO has risen in price by thousands of dollars. Even then, some users specifically bought the game in order to subsequently buy rare and expensive skins. Over time, their business has paid off with interest.
Features of blockchains
Another, albeit more primitive, example of how blockchain works is real estate. When you buy an apartment, absolutely any apartment in absolutely any city or village, a record of this is immediately recorded in the register of a state organization, where you are then noted as a full owner. A similar process occurs when you buy an NFT: the purchase data is recorded on the blockchain. It will indicate when you bought this or that object, for what amount, what it is and, of course, it will indicate your rights to the object as its owner.
What are the prospects?
Logically, blockchain technology will not disappear anywhere in the future. Perhaps it will even help fight corruption: if all students are issued diplomas only as an NFT (this also applies to medical certificates), it will be much more difficult to forge documents or buy them. Indirectly, the emergence of NFT was influenced by an overabundance of content on the Internet: trillions of pictures and videos have ceased to attract attention. Expressing yourself and your interests goes under the content ownership model. Fordham University professor Donna Redell argues that NFT cannot replace existing business models, and it does not have such a goal. The task of the blockchain is to change them, improve them, adapt them to the future.