NFT: All you need to know
If you would have told me a year ago that there is something called NFT that would be bought and sold for millions of dollars, I would have probably laughed at you, but the reality is that NFTs are here and is making people a lot of money. So what exactly is NFT? And is it the future?
NFT is a non-fungible token, and non-fungible means not interchangeable, which means that it does not have the same value, which also means that it is unique by its nature. Token means that it is existent digitally and is protected on the blockchain. An example of something non-fungible in real life is the Mona Lisa; there is only one in the world. So NFT is just a digital asset that cannot be replicated because of its existence on the blockchain. NFTs do not have the same value as each other’s and NFT is a digital certificate that is stored on a blockchain the same way that cryptocurrencies are stored, so we use NFT to prove ownership of a particular digital file. An NFT could be a piece of art, a collectible piece of music… So it is a file that we have ownership of. The most common example of an NFT today is a picture, but it can also be a GIF songs videos tweets, and a lot of other things the advantage of it is that your ownership is recorded on the blockchain that is so secured. The most common example of NFTs is the bored ape Yacht Club, which a lot of rich people are buying, and recently Elon Musk bought a golden bored Ape Yacht Club NFT for 1.6 million dollars.
How does NFT work?
You can buy NFTs using Ethereum which is a cryptocurrency (like bitcoin), and when you buy it, your purchase is registered on the blockchain and there will be a clear piece of proof that you own this NFT which we call a smart contract which shows information of how the purchase was done and how so key piece of information.
Why is it important to buy it?
What you could ask is if it is a picture, why cannot I google it and take a picture of it? and use it. Why is it important to buy it? The first reason is if you screenshot it, you will not have ownership of it, so if it has copyrights, the owner may legally pursue you. The second reason is people collect them to have a certain collection of them. The third reason is the social status for example celebrities and rich people are buying the ape NFT which is very popular right now. Each celebrity is trying to buy the more expensive NFT as they see it as a competition, for example, Logan Paul was one of the first celebrities to get into the NFT game when he sold over 5 million worth of NFTs related to Pokémon. For example, Justin Bieber bought a bored ape for 1.3 million dollars, Jimmy Fallon bought another bored ape NFT for 300 thousand, and Kevin Hart also bought one for 200 thousand $. The most expensive bored ape NFT ever sold at 2.7 million dollars.
The most expensive NFT ever:
The single most famous NFT sale (and the most expensive NFT sale) in 2021 was made by Beeple. Beeple’s real name is Mike Winkelmann, an American digital artist, graphic designer, and animator. The name of the NFT was Everyday: The First 5000 Days. It was sold for $69,346,250 (38,525 ETH). Not only was this the most expensive NFT sale ever, but the event created a snowball effect throughout mainstream media, and brought the term “NFT” into households around the world. Before this NFT was sold, Online Auction, the act of minting, collecting, and trading NFTs was seen as niche at best. But after Beeple secured the biggest bag in all of NFTs, it was clear that the time of NFTs had arrived.
So where can I buy NFTs from?
There is only a handful of places that I would recommend Open Sea, Binance, Rarible, and Super Rare, these are the best places. We should be careful though, there is a big possibility that we would make a profit but also there is a big probability that we would make a loss so you should be careful while buying an NFT, and you should do your own research.
Does NFT grant copyright?
Unfortunately, not always, you might be buying the complete ownership of the product, yes, you do become the owner in the sense of it is registered on the blockchain in your name, but in Lebanon for example, it does not enter in the copyrights law in the country, so you might not have the permission to reproduce it, for example, to use the logo on a Tshirt.
What is the size of the NFT market?
In 2022 the NFT market is expected to reach as much as $35 billion in net sales volume. The reality is that NFTs are not going to fade anytime soon, yes maybe some particular NFTs may fade away, like lame pictures of rocks, but people are realizing and are accepting that this is the future of the digital world and the biggest proof is that the market is growing every single day
The big question comes now? Is it the future?
I would personally say it is the real deal and the future and here’s why: years ago trading cards were really popular in Sports. Like Cards of Michael Jordan, Magic Johnson and Babe Ruth and similar to these trading cards, we are transitioning to some sort of online digital cards that are used not only for sports but almost every aspect of life and everything we can think of. So, you may ask me. What can NFT be used in the future other than just collection or prestige? The most important thing is Authentication, in the traditional world, we use all kinds of paperwork to authenticate any information or transaction, for example, a bank payment needs a third party that can authenticate the payment, so in the future, we can use NFTs as a form of authentication.
A funny true story to wrap up:
A university student from Indonesia named Ghozali has become an overnight internet sensation after turning a personal selfie project into an NFT business with $2 million in sales on Open Sea. He transformed his selfies pictures into NFTs for fun and it made him a lot of profit. And there are a lot of wild stories like this one happening in the NFT world.
