According to BBC, the co-founder of Twitter, Jack Dorsey, sold his own tweet as an NFT for $2.5 million.
With people adapting to the reality of isolating, most have turned to online operations and transactions. Access to the internet has become a necessity and an opportunity for businesses to expand their operations. NFTs have become the new wave for art creators, buyers, and collectors. These digital assets have been booming recently, especially with all people stuck on their devices.
So let’s take a closer look at this modern-day take on art!
What’s an NFT?
The Verge shares that NFT stands for non-fungible token. But what is a non-fungible token? These are unique digital assets that cannot be replaced by something else. Think of these as similar to physical trading cards which are also non-fungible. If it’s traded for a different card, you’d have something entirely different. NFTs can really be anything digital such as drawings, music, but a lot of the current excitement is around using the tech to sell digital art.
Are these similar to cryptocurrencies? They do have similarities, but only at the base level.
According to Forbes, NFTs are generally made with the same kind of programming as cryptocurrency, like Bitcoin, but only in that way are they similar. Cryptocurrencies, like physical money, are “fungible,” which means it could be traded or exchanged for one another, while also being of equal value.
What are some examples of NFTs?
An NFT could be any of the following: Art, GIFs, Videos and sports highlights, Collectibles, Virtual avatars and video game skins, Designer sneakers, Music, and much more!
Though there are ways to go online and access a copy for free, each NFT token includes a digital signature that proves ownership. This is what makes it impossible for it to be equal to another. In most cases, the original artist keeps the copyright ownership, giving them the option to produce and sell more of the same copy of art.
With everyone and everything adapting to the digital age, NFTs having been increasing in popularity worldwide. As a digital piece, it is much more accessible to all, making the scarcity drive its prices.
Are NFTs here to stay?
All of this is speculation for now, but this type of collectable holds a lot of promise.
Just because these types of things are available, doesn’t mean you should hop on the bandwagon right away and expect instant returns. With NFT’s long-term value uncertain, it’s difficult to gauge if these are worth investing in. If you have some savings set aside that you can spend, why not test the waters and start small? Try it out for yourself and see if this could be something that interests you.
Always remember though that the value of an NFT relies on the demand and price is only determined by how much people are willing to pay. This means that with NFTs, there’s a risk in reselling it for less than what you got it for. With this basic knowledge of NFTs, it’s important to approach them just like you would any other investment. More research, look at the risks, and if you decide to dive deeper, proceed with caution.
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