NFT’s search volume in 2020 was recorded as 1.8 million searches, and by the end of 2021 the numbers have “hundrupled”, I am not sure if that’s even a word but it was searched 24 billion times alone on Google.
Then you’ll be more surprised to know that almost 40 billion dollars have been poured into NFT’s since the term was coined on August 7, 2015. No doubt these numbers are insane but what the hell is an NFT?
A unique digital identifier that cannot be copied, substituted, or subdivided, that is recorded in a blockchain, and that is used to certify authenticity and ownership (as of a specific digital asset and specific rights relating to it)
This is what I read when I searched about NFT on Google, but I am sure most of you won’t understand these fancy technical terms. So, here I am to make it easy for you to understand NFTs and how you can become a part of this huge community.
But first let’s understand it from scratch!
NFT stands for Non-Fungible token and in layman’s language NFT is a piece of data recorded on blockchain which can be associated with an image, video, game, text file, music and whatnot! This data adds authenticity, ownership and transferability to digital art.
Suppose you painted a beautiful picture on a canvas and you wish to earn money through it. So, what you can do is, click a picture of it, make an NFT, and show it to people around the world without worrying about getting it stolen. Once it becomes an NFT, it simply becomes a tradable asset which can be sold via auctions or multiple channels to potential buyers.
The main benefit of this technology is that people on the internet can see who created this NFT, who brought it, when brought and for how much. In this way people can verify its authenticity, people can bid on it, value it, own it and ultimately transfer it.
Creators can also code royalties in this piece of data via which the creator can get some portion of sales every time someone sells this NFT. Interesting right? Additionally, the owner has the full rights of the NFT and he/she can use this image as a logo for branding or simply print it and display it on the walls of their homes. Win-Win deal for both parties!
How are NFTs different from physical art?
I am sure you must have heard of counterfeit art pieces being sold for millions and making a hole in the pockets of the buyers. NFTs tackle this problem super effectively, but first let’s learn about fungible and non fungible goods.
A fungible good is something that gets consumed after being used, but that can be replenished by another similar unit. For example, a tissue paper.
Non- Fungible good
On the other hand, a non-fungible good cannot be replaced by another unit because of its unique characteristics. For example, a painting made by you as your unique composition, it can be copied, or counterfeited but the one made by you at your home is unique.
So, blockchain is the technology that supports NFTs and it attaches a metadata to any type of art, and using this metadata one can differentiate between the unique ones and the replicas.
What is an example of NFT?
To make it more clear, let’s take a look at an NFT called Cryptopunk#5822.
This might look like a 2-D jpeg but it got sold for almost 24 million dollars on 12 February 2022. If it was not an NFT, I can bet people won’t even look at it for more than 2 seconds, but that’s how revolutionary simple images or arts can become once they become NFT.
What is NFT art?
Any art piece like an image from your gallery or your sound recording or even a text message by you to your lover, when it gets registered (minted) on blockchain becomes NFT art.
Like I already mentioned, a regular artwork can become exclusive, transferable and ownable just by becoming an NFT.
It’s not rocket science, just a little research and a few clicks can make you rich in no time.
Can I make an NFT?
Yes, making an NFT can be super easy and if your art has the potential, you can become a millionaire just by selling your selfies as an NFT.
No, I am not kidding, a guy from Indonesia, Sultan Gustaf Al Ghozali simply converted his 933 selfies into NFT and earned 11 million dollars by selling them to people around the world. Here is the link to his NFT collection: https://opensea.io/collection/ghozali-everyday
So, to create an NFT you should have knowledge about blockchain and on which blockchain you wish to launch your NFTs. Some of the popular blockchains are:
Why do people buy NFTs?
I have listed multiple reasons for why NFTs are better than the physical artworks but just to explain it a little more, let’s look at how various NFT projects provide utility to their holders and this accounts for the immense boom in this growing industry.
Here are the top 3 NFT projects which are very popular in the NFT community and why they are so popular among sports personalities, singers, rappers and many famous people.
Bored Ape Yacht Club
The Bored Ape Yacht Club is a collection of 10,000 unique Bored Ape NFTs— unique digital collectibles living on the Ethereum blockchain. This NFT not only acts as a cool jpeg but also offers its holders a membership pass which gives access to extravagant parties, members only conferences, access to a huge community of like minded people and even 2 penthouses which will be used exclusively to hold events for the NFT holders.
Additionally, people use these NFTs as their profile pictures on social media as a flex similar to luxury watches and expensive cars. Cheapest Bored ape is available for around 100k dollars.
Superstars like Justin Bieber, Eminem, Snoop Dogg, Jimmy Kimmell, Lil Baby, Post Malone and many others hold BAYC in their NFT collections.
Seems unreal right? But there’s more! Initial holders of this NFT received 2 more NFTs as a gift: Mutant Serum and Kennels. The serum can be used to mutate your bored ape to mutant ape and they are selling for 30K dollars and kennels are selling for 24K dollars on different platforms.
You can imagine how much utility a single NFT holds for its buyers and creators receive a royalty every time people trade these apes.
The CryptoPunks are 10,000 uniquely generated characters. No two are exactly alike, and each one of them can be owned by a single person on the Ethereum blockchain.
Originally, they could be claimed for free by anybody with an Ethereum wallet, but all 10,000 were quickly claimed. Now they must be purchased from someone via the marketplace that’s also embedded in the blockchain. Via this market you can buy, bid on, and offer punks for sale.
As we talk about the utility, this NFT which was claimed for free of cost now costs at least 100K dollars. Apart from the flex, these NFTs are very significant, similar to Picaso’s paintings, as they started the NFT revolution and people are going crazy to own one.
Cryptopunks holders are looked upon by people in the NFT space and owning a piece of art with a lot of significance is a matter of pride more than any utility.
CLONE X – X TAKASHI MURAKAMI
Clone X is one of the coolest looking NFTs which have been created by RTFKT studios in collaboration with legendary artist Takashi Murakami. 20,000 digitally created clones are a big time flex and twitter is flooded with people using these NFTs as their profile pictures.
Apart from the very gen-z graphics this project aims to provide ultimate utility to its holders and within just 3 months of launch its holders has received 3 additional NFTs which are selling from 2K dollars to 18k dollars.
Buyers are using these JPEGs at their workplace and homes to create modern aesthetics and become part of the NFT hype. Furthermore, Clone X holders are given various benefits like free meditation sessions from top instructors, free mental health sessions, free merchandise, access to a community of hip hop enthusiasts and so on.
So, If next time someone says to you NFTs are just JPEGs, you know the answer to their ignorant statement that NFTs are way more than fancy tokens and JPEGs.
How does NFT work?
- Most of the NFTs are available on Ethereum blockchain, a distributed public ledger that records transactions and are sold on Opensea, a platform where millions of buyers and sellers are available selling and seeking artworks of all kinds.
- NFTs are non-fungible tokens with valuable information stored in them, this information can be adjusted by the creator as per his/her preference. Example: It can be enabled to earn royalties, or can be unlocked after a certain period of time and even gather information of sellers so one can keep in touch with the respective buyer(s).
- The fact that NFTs hold a value reflected upon by supply and demand of the market, it can be viewed and traded among people without the risk of losing proof of ownership.
- NFTs’ unique data makes it easy to verify and validate their ownership and the transfer of tokens between owners.
I hope you understand what the hell is an NFT and definitely be interested in entering the space as an artist or as a collector.
We help artists to mint NFTs on solana blockchain which is one of the fastest growing blockchains for NFT artists. If you wish to enter the NFT space visit our website: https://apps.shopify.com/dropmint-nft or simply connect with us and we’ll make sure that your art gets listed without any trouble.
Schedule a meeting with us here: https://calendly.com/gaganluthra/