What exactly is NFT? The ownership of digital assets that can be traded using cryptocurrencies is evidenced by non-fungible tokens, or NFTs. NFTs are distinct from other digital assets since they cannot be exchanged.
We shall discuss the background of NFT and how the procedure has operated thus far in this article.
NFT is integrated with a system that can record transaction information, making it safe and difficult to hack. This system is called blockchain technology. Blockchain is one type of Distributed Ledger Technology or Distributed Ledger Technology.
What does NFT look like and an example? A non-fungible token, can technically be anything that is digital. For example, images, animated GIFs, songs, and items in video games.
Then, how is it different from other digital objects? NFT exists only in the three – dimensional virtual world of the Metaverse, so you must enter into that world if you want to have ownership of NFT digital assets. In addition, the digital assets in Metaverse are protected by a system that can track their ownership.
History of Non-Fungible Token
Before the CryptoArt Market burst, on May 3, 2014, Kevin McCoy created the non-exchangeable “Quantum” token. An octagonal pixel image made up of circles, arcs, or other geometries having a common center is referred to as a quantum.
Time-based media art is combined with CryptoArt or NFT, which uses Blockchain technology.
NFT is authentic because of the decentralized manner in which it operates.
NFT represents any digital asset that is on the Ethereum blockchain , thus making it rare, verifiable and valuable. The emergence of NFT has created a new medium for artists and creators to showcase their work or collections. In turn, a revolution paved the way for artists to create and monetize their work.
NFT assets can be in the form of digital art, collections, music creations, or synergies between the three. NFT can also be a completely new and unexplored composition. This requires NFT creators and artists to be innovative and adaptive to change.
CryptoArt was initiated by cultural phenomena such as CryptoPunks, Rare Pepe, and CryptoKitties. The works of art became famous because they went viral. Here’s the full explanation.
Colored Coins (2012-2013)
The “Colored Coin” that circulated on the Bitcoin network in 2012–2013 served as the inspiration for NFT. On the Blockchain, colored coins are tokens that stand in for physical goods. These coins can be used to demonstrate ownership of any type of asset, including precious metals, vehicles, homes, stocks, and bonds.
Counterparty (2014)
Robert Dermody, Evan Wagner, and Adam Krellenstein launched Counterparty in 2014. Built on top of the Bitcoin Blockchain, Counterparty is a peer-to-peer, distributed financial platform and open-source internet protocol.
The platform offers a decentralized exchange and permits the production of assets.
enabling users to produce their own exchangeable cash in this way.
Spells of Genesis Counterparty (2015)
In April 2015, Counterparty partnered with the Spells of Genesis development team. They were not only pioneers in issuing in-game assets to the blockchain via Counterparty, but were also among the first to release an ICO (Initial Coin Offering). So in development Counterparty can introduce their own in-game currency called BitCrystals.
Trading Cards on Counterparty (2016)
In August 2016, a new trend began to emerge. Counterparty teamed up with Force of Will, a popular trading card player. They launched their card on the Counterparty platform.
Behind Pokemon, Yu-Gi-Oh, and Magic, Force of Will is the 4th ranked card game in North America. Their entry into the ecosystem, where they have no previous blockchain or Cryptocurrency experience , signifies the value of placing those assets on the Blockchain.
Rare Pepes on Counterparty (2016)
Memes first appeared on the blockchain in 2016. Afterward, Meme started to access the Counterparty platform in October 2016. To several “Rare Pepes” memes, people started adding assets. The frog-themed meme known as Rare Pepes has a devoted following over the years.
Pepe the Frog was originally a comic book character, but it has now evolved into one of the most well-known memes.
Early in 2017, when Ethereum gained popularity, Rare Pepes also began trading there.
Portion founder Jason Rosenstein, along with Louis Parker, auctioned off Rare Pepes at the first Rare Digital Art Festival. CryptoArt was born with the Rare Pepes Wallet and this is the first time content creators around the world can submit and sell their own art.
CryptoPunks (2017)
As Rare Pepes trades increased, John Watkinson and Matt Hall, creators of Larva Labs, created unique characters created on the Ethereum blockchain . The character is limited to 10,000. The name Cryptopunks refers to experiments with Bitcoin in the 1990s and can be described as a hybrid of ERC721 and ERC20.
ERC20 is the most common Ethereum token standard. These tokens have rules that allow tokens to interact with each other. Meanwhile, ERC721 aims to become the NFT standard on the Ethereum Blockchain. ERC721 helps track individual token holdings and movements.
NFT CryptoKitties started operating using ERC721. CryptoKitties is a blockchain -based virtual game that allows players to adopt, breed and trade virtual cats using Ethereum. The game’s popularity exploded and it landed headlines on CNBC and Fox News.
NFT Explosion (2018-2021)
Between 2018 and 2021, NFT slowly moved to the attention of the public before finally booming in early 2021. This seemingly underground movement rattled the crypto community to slowly shift to more mainstream art. This transition reached a turning point on Valentine’s Day 2018, when artist Kevin Abosch partnered with GIFTO for a charity auction.
This partnership resulted in a $1 million transaction from CryptoArt called The Forever Rose. Abosch continued to raise the stakes when he started using the Ethereum Blockchain combination in a project called “IAMA Coin”.
The NFT marketplace is more efficient and more liquid than existing asset transfer platforms. Many platforms have emerged online, each hosting a differentiator for creators and collectors alike. OpenSea is considered the largest marketplace for art, music, domain names, collectibles, and trading cards.
Types of Non-Fungible Token
From an explanation of the history of the beginning of the creation of NFT , it can be concluded that the types or forms of NFT itself can be in the form of digital arts, collectibles, and games. While the category is still likely to grow, don’t just focus on the three. So that makes NFT “quite promising” in the future.
Who Can Make NFT?
Anyone can make NFT. Starting from Artists, Entrepreneurs, Companies, Writers, Videographers, Influencers, or Content Creators. As long as you have legal proof of ownership of digital assets in Metaverse, no experience is required to jump into it.
A few years ago, small-scale experiments were conducted with concepts like DAO, token-based Metaverse, community-owned financial protocols, and NFT art (CryptoArt). NFT will develop into an essential technology for daily life through tokenization, programmability, collaboration, royalties, and more direct linkages between artists and collectors.
Another option for investing in the online world that is connected with cryptocurrency is provided by an explanation of what NFT is and how it has grown to be a popular trend today.
It is important to note that while NFTs offer unique digital ownership and scarcity, they do not necessarily guarantee investment protection. The value of an NFT is largely determined by market demand and can be highly volatile, with prices subject to fluctuations based on various factors such as trends, popularity, and the perception of the artwork or asset being represented.
Furthermore, while blockchain technology does provide certain protections such as transparency and immutability, it is not immune to potential security vulnerabilities, such as hacking or fraud, which could affect the value and legitimacy of NFTs.
As with any investment, it is important to do thorough research, consider the risks and potential rewards, and make informed decisions based on your own financial situation and risk tolerance.
