There\’s a lot of people asking this and not getting any answers. For those who need nitty gritty details, here\’s some info that might help you make informed decisions.
What is an NFT?
It is a Non fungible token. Okay, so what is a fungible token?
A non-fungible token is a unique and non-interchangeable unit of data stored on a blockchain, a form of digital ledger. NFTs can be associated with reproducible digital files such as photos, videos, and audio.
How does NFT work?
You\’ve probably seen the Cryptokitty and other NFT\’s that have been hot recently.
Basically, you can send NFT\’s to another account and it will show up in their account as NFT\’s. This NFT is unique on the Ethereum network, meaning nobody else can use this NFT except for its owner. Essentially, one NFT shows ownership of a digital file (the cat image), which you can then put your name on top of or whatever you want to do with it.
This method of storing NFT means that if someone were to get access to your NFT file(s) they would not be able to make multiple copies since every NFT is unique/non-fungible on the blockchain.
What can I do with NFT?
You can make a NFT unique and send it to other NFT-owners. When you create NFT, there is usually a cost associated with the creation of the NFT. This means that someone could buy NFT from another person and then transfer them to their own account – making a profit off the price difference between what they paid for the NFT and what they sold it for.
What happens if I buy NFT and the NFT becomes worth more than what I bought it for?
You can sell NFT you own like you would any other Crypto asset. There\’s an entire market for NFT.
So that means NFTs are valuable? How do they become valuable?
The people who create NFT decide how NFT will be used, which affects its value. Whether it\’s a digital file such as Cryptokitty (which may have value on its own already because of uniqueness) or non-fungible tokens associated with a video game character, each NFT has its own value. NFTs are valuable because of their unique natures (non-fungibles).
People create and collect NFT\’s with the hope to profit in the future. It is still fairly new but massive amounts of money have already exchanged hands amongst collectors. With all of that being said. There is still the possibility that you can lose money on your NFT creation. The best way to avoid the loss is to make sure you create things that are actually valuable to others.
What NFT\’s can I create?
You can create anything that doesn\’t already exist. So you cannot make a NFT that is an asset or token associated with something that does not yet exist in the real world (e.g. trying to sell NFT\’s of Pokemon cards even if its an NFT, people could still go to websites and buy the actual card instead because they are all publicly available).
Can I use NFT\’s that I have bought?
Yes, you can. You can buy and sell NFT\’s just like you would any other Crypto asset such as Bitcoin or Ether. You can keep it as a collectible or even use it on a Digital Project.
I hope this was helpful and looking forward to seeing more awesome NFT\’s being created in the world of Digital Marketing.