You might have sen the three letters NFT going around on the internet these past couple of months. They have taken the world of art, crypto-currency and even sports by storm. NFTs are designed to give you something that can't be copied. But what are they actually good for? How do you use them? And where to buy them?
What are NFTs?
NFT comes from the English expression 'Non-Fungible Token.' The word fungible means something unique, which cannot be replaced. These tokens are therefore not interchangeable with anything similar. For example, if someone gives out coins worth 5 pounds and in return the person receives a 5-pound note, then that is fungible.
In fact, most currencies can be characterised as fungible. Cryptocurrency is also part of this fungible currency. Take bitcoin for example, if you exchange it you will get an identical good and the same overall asset. In contrast, a non-fungible product cannot be substituted for something of similar value.
NFTs are disrupting the digital world
Digital art is being called a new 'art,' however, its popularity has been at odds with the rise of the Non-Fungible Tokens since all digital assets are non-fungible, making it safe from copying. In fact, NFTs are best known for being equated with 100% digital art sales.
While NFTs are designed to give you something that cannot be copied, it should be noted that if the buyer has ownership of the work, the artist can still retain copyright and reproduction rights. And if you thought this was fresh and recent: NO. As early as 2016, NFTs in the form of trading cards were already being snapped up...
How are these non-fungible tokens used?
These non-fungible tokens can be used to purchase digital works such as a drawing, a photo, a video, a sound... in the form of JPGS, MP3, videos, GIF etc. The types of NFTs are diverse, as anything that is both unique and digitally storable can be considered valuable.
Let's stop you right there, going to Google image and registering an image does not make you the owner of an NFT image. And you won't become a millionaire either! Your image that you just uploaded will not contain the information from the Ethereum blockchain that secures the work.
The NFT itself serves as a digital certificate of authenticity, acting as a deed of ownership for the person holding it. This title simply certifies that it is a unique digital document. The certificate contains proof of authenticity, the name of the owner, the origin of the item and a sales history. The latter is then secured by the Ethereum blockchain.
What is a blockchain?
Blockchain is a transparent and secure storage technology for digital media. A bit like a digital passport. It should be noted that other blockchains can implement their own versions of NFT. Specifically for Ethereum, it is a decentralised exchange protocol. That is to say, on this platform, users can create smart contracts that are based on a digital protocol to verify or enforce a mutual contract. Ethereum also has a crypto-currency called Ether
The rarer it is, the more expensive it is
In March 2021, a work by American artist Beeple called 'Everyday: The First 5,000 Days' was sold for $69.3 million (£49 million). To date, this 10-second video by Beeple is the most expensive NFT ever sold. This digital artwork consists of 5,000 drawings or animations made over 5,000 successive days.
This little story has made many people dream, as Beeple is a former web designer who started working in graphic design in 2007. He spent 5,000 days training in digital design at the rate of one production per day. You know the rest of the story, as his designs sold for no less than $69 million! Today, Beeple is the third most expensive artist alive, behind David Hockney and Jeff Koons.
NFT tokens don't stop at just art!
Twitter founder Jack Dorsey auctioned off his first tweet. The result: 2.9 million dollars. The tweet, which read 'just setting up my twttr,' was published on 21 March 2006. It has been shared over 120,000 times and liked over 160,000 times. 15 years later, this five-word phrase has sold for millions of dollars.
Sina Estasvi, who has been very active in the world of blockchain and crypto-currencies for several years, won the auction. He bought the tweet in non-fungible tokens using the crypto-currency Ether.
Where to buy NFT tokens?
NFT tokens can be purchased on several platforms. Which one you choose will depend on what you want to buy. For example, if you want to buy a gif of Nyan Cat (also known as Pop Tart Cat), you can go to Digital Trending Cards.
As the Beeple sale proved, some pieces are starting to be sold in more traditional auction houses, which is worth keeping a close eye on!
To sum up, NFT is about the notion of ownership in a world where normally ownership is often violated (piracy, etc). It is also called the 'digitisation of property.' Finally, it is important to know that anyone can create an NFT on any digital work. It remains to be seen whether someone will want to buy it from you...