NFTs have become a hot topic in the world of digital art, collectibles, and blockchain technology. Let’s explore what NFTs are, how they work, advantages, risks and much more.
What are Non-Fungible Tokens (NFTs)?
Let’s first clarify the term “fungible.” Something is fungible if it can be exchanged on a one-to-one basis with another item of the same type. For example, money is fungible because you can exchange one dollar bill for another without any difference in value. On the other hand, something non-fungible is unique and cannot be interchanged with something else in a straightforward manner.
Non-fungible tokens, are digital assets that represent something unique or one-of-a-kind. Unlike regular money or cryptocurrencies, these cannot be exchanged on a one-to-one basis because each one is distinct. They are built using blockchain technology, which is like a digital ledger that keeps track of who owns what. They can represent various things like artwork, music, videos, virtual items in games, and more. They prove ownership and authenticity, so if you own an NFT, you can prove that you own the original version of that digital item. People buy and sell them in online marketplaces, and they have gained popularity as a new way for artists and creators to sell their work directly to fans.
History of NFTs
The concept of NFTs dates back to the early 2010s when developers began experimenting with the idea of attaching ownership to digital items using blockchain technology. They gained popularity in 2017 with the advent of CryptoKitties, a blockchain-based game that allowed users to collect and breed unique virtual cats. Read More
