NFTs: What NFTs are, why they’re worth millions, where to sell and buy
What are NFTs?
NFTs means non-fungible tokens. NFT basically means that it’s a one-of-a-kind digital asset that belongs to you and you only. The most popular NFTs right now include artwork and music, but can also include videos and even tweets.
NFTs are taking over and selling for millions.
The CEO of crypto exchange Coinbase said last month that the NFT market could quickly surpass the company’s cryptocurrency trading business.
From a $69 million piece of artwork to a $379,000 song created using the genetic sequence of COVID-19, NFTs are the Internet’s latest obsession. And they have the potential to make real money, too.
“Non-fungible” more or less means that it’s unique and can’t be replaced with something else. For example, a bitcoin is fungible — trade one for another bitcoin, and you’ll have exactly the same thing. A one-of-a-kind trading card, however, is non-fungible. If you traded it for a different card, you’d have something completely different. You gave up a Squirtle, and got a 1909 T206 Honus Wagner, which StadiumTalk calls “the Mona Lisa of baseball cards.”
At a very high level, most NFTs are part of the Ethereum blockchain. Ethereum is a crypto currency, like bitcoin or dogecoin, but its block chain also supports these NFTs, which store extra information that makes them work differently from, say, an ETH coin. It is worth noting that other block chains can implement their own versions of NFTs. (yes, some already have)
What’s worth picking up at the NFT supermarket?
NFTs can be anything digital (such as drawings, music, your brain downloaded and turned into an AI), but a lot of the current excitement is around using the tech to sell digital art.
A lot of the conversation is about NFTs as an evolution of fine art collecting, only with digital art.
Buying Good Tweets
Coming up with the line “buying my good tweets,” the founder of Twitter sold one for just under $3 million.
Do people really think this will become like art collecting?
Some people really hope so — like whoever paid almost $390,000 for a 50-second video by Grimes or the person who paid $6.6 million for a video by Beeple. Actually, one of Beeple’s pieces was auctioned at Christie’s, the famou—
You can copy a digital file as many times as you want, including the art that’s included with an NFT. But NFTs are designed to give you something that can’t be copied: ownership of the work (though the artist can still retain the copyright and reproduction rights, just like with physical artwork). To put it in terms of physical art collecting: anyone can buy a Monet print. But only one person can own the original.
The image that Beeple was auctioning off at Christie’s ended up selling for $69 million, which, by the way, is $15 million more than Monet’s painting Nymphéas sold for in 2014.
Whoever got that Monet can actually appreciate it as a physical object. With digital art, a copy is literally as good as the original.But the flex of owning an original Beeple…
No shade to Beeple, but the video isn’t really a Monet.
Have you heard of penguin communities?
Right! People have long built communities based on things they own, and now it’s happening with NFTs. One community that’s been exceedingly popular revolves around a collection of NFTs called Pudgy Penguins, but it’s not the only community built up around the tokens. It could be argued that one of the earliest NFT projects, CryptoPunks, has a community around it, and there are other animal-themed projects like the Bored Ape Yacht Club that have their own clique.
Of course, the communal activities depend on the community. For Pudgy Penguin or Bored Ape owners, it seems to involve vibing and sharing memes on Discord, or complimenting each other on their Pudgy Penguin Twitter avatars.
What’s the point of NFTs?
It depends on whether you’re an artist or a buyer.
You are an artist
First off: You might be interested in NFTs because it gives you a way to sell work that there otherwise might not be much of a market for. If you come up with a really cool digital sticker idea, what are you going to do?
Also, NFTs have a feature that you can enable that will pay you a percentage every time the NFT is sold or changes hands, making sure that if your work gets super popular and balloons in value, you’ll see some of that benefit.
You are a buyer
One of the obvious benefits of buying art is it lets you financially support artists you like, and that’s true with NFTs (which are way trendier than, like, Telegram stickers). Buying an NFT also usually gets you some basic usage rights, like being able to post the image online or set it as your profile picture. Plus, of course, there are bragging rights that you own the art, with a blockchain entry to back it up.
NFTs can work like any other speculative asset, where you buy it and hope that the value of it goes up one day, so you can sell it for a profit.
Is every NFT unique?
In technical sense, every NFT is a unique token on the blockchain. But while it could be like a van Gogh, where there’s only one definitive actual version, it could also be like a trading card, where there’s 50 or hundreds of numbered copies of the same artwork.
Who would pay hundreds of thousands of dollars for what basically amounts to a trading card?
Well, that’s part of what makes NFTs so messy. Some people treat them like they’re the future of fine art collecting (read: as a playground for the mega-rich), and some people treat them like Pokémon cards (where they’re accessible to normal people but also a playground for the mega-rich). Speaking of Pokémon cards, Logan Paul just sold some NFTs relating to a million-dollar box.
Yes, he sold NFT video clips, which are just clips from a video you can watch on YouTube anytime you want, for up to $20,000. He also sold NFTs of a Logan Paul Pokémon card.
Who paid $20,000 for a video clip of Logan Paul?
… It would be hilarious if Logan Paul decided to sell 50 more NFTs of the exact same video.
Linkin Park’s Mike Shinoda (who also sold some NFTs that included a song) actually talked about that. It’s totally a thing someone could do if they were, in his words, “an opportunist crooked jerk.” I’m not saying that Logan Paul is that, just that you should be careful who you buy from.
We have seen big brands and celebrities like Marvel and Wayne Gretzky launch their own NFTs, which seem to be aimed at more traditional collectors, rather than crypto-enthusiasts.
Can I buy this article as an NFT?
No, but technically anything digital could be sold as an NFT. Deadmau5 has sold digital animated stickers. William Shatner has sold Shatner-themed trading cards (one of which was apparently an X-ray of his teeth).
Can someone buy another person’s teeth as an NFT?
I haven’t seen any teeth yet. There have been some attempts at connecting NFTs to real-world objects, often as a sort of verification method. Nike has patented a method to verify sneakers’ authenticity using an NFT system, which it calls CryptoKicks.
There are several marketplaces that have popped up around NFTs, which allow people to buy and sell. These include OpenSea, Rarible, and Grimes’ choice, Nifty Gateway, but there are plenty of others.
NFTs really became technically possible when the Ethereum blockchain added support for them as part of a new standard. One of the first uses was a game called CryptoKitties that allowed users to trade and sell virtual kittens.
The kittens show that one of the most interesting aspects of NFTs (for those of us not looking to create a digital dragon’s lair of art) is how they can be used in games. There are already games that let you have NFTs as items. One even sells virtual plots of land as NFTs. There could be opportunities for players to buy a unique in-game gun or helmet or whatever as an NFT, which would be a flex that most people could actually appreciate.
There are people who are spending tens or hundreds of thousands of dollars on NFT pet rocks.
What you need to know about NFTs
– NFTs are unique cryptographic tokens that exist on a blockchain and cannot be replicated.
– NFTs can be used to represent real-world items like artwork and real-estate.
– “Tokenizing” these real-world tangible assets allows them to be bought, sold, and traded more efficiently while reducing the probability of fraud.
– NFTs can also be used to represent individuals’ identities, property rights, and more.
How Does an NFT Work?
NFTs exist on a blockchain, which is an administered public record that records transactions. You’re probably most familiar with blockchain as the underlying process that makes cryptocurrencies possible.
Specifically, NFTs are typically held on the Ethereum blockchain, although other blockchains support them as well.
An NFT is created, or “minted” from digital objectives that represent both definite and intangible entries, including:
– Virtual avatars and video game skins
– Designer sneakers
– Videos and athletics highlights
How to buy NFTs
Essentially, any digital image can be purchased as an NFT. But there are a few things to consider when buying one, especially if you’re a newbie. You’ll need to decide what marketplace to buy from, what type of digital wallet is required to store it and what kind of cryptocurrency you’ll need to complete the sale.
Some of the most common NFT marketplaces include:
– Nifty Gateway and
There are also niche marketplaces for more specific types of NFTs, too, such as NBA Top Shot for basketball video highlights or Valuables for auctioning tweets such as Dorsey’s currently up for bid but be wary of fees. Some marketplaces charge a “gas” fee, which is the energy required to complete the transaction on the blockchain. Other fees can include the costs for converting dollars into ethereum (the currency most commonly used to buy NFTs) and closing expenses.
How to sell NFTs?
NFTs are also sold on marketplaces and the process can vary from platform to platform. You’ll essentially upload your content to a marketplace then follow the instructions to turn it into an NFT. You’ll be able to include specifics such as a description of the work and suggested pricing. Most NFTs are purchased using ethereum but can also be bought with other ERC-20 tokens such as WAX and Flow.
How to make an NFT?
Anyone can create an NFT. All that’s needed is a digital wallet, a small purchase of ethereum and a connection to an NFT marketplace where you’ll be able to upload and turn the content into an NFT or crypto art.