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What are NFTs? 

A non-fungible token (NFT) is a unique, intangible digital asset created on the blockchain, such as a piece of art, a photo, or a virtual game collectible.

Unlike other digital assets, NFT are specifically designed to be unable to be exchanged for another. Each NFT is unique, unlike each bitcoin or ether. They are distinguished from each other by information and unique identifiers such as barcodes. The information that makes up the asset of an NFT is called ” metadata “.

The first non-fungible asset was created in 2014 as an experiment for the Seven on Seven conference at the New Museum in New York. Today, utility continues to grow in important niches including music, fashion design, academia, patents and approvals, but also sales and loyalty programs. Thus, anyone interested in valuing their digital creation such as music, art or photos can do so through NFTs.

So, how do you create, buy, and use NFTs?  

The creation of a non-fungible token (NFT) can take place in any digital form, having as content both paintings, photos, texts, songs or videos, as well as virtual objects from video games, collectibles such as avatars, weapons or virtual currencies. Thus, we notice that there are no limits, everything depends on the imagination of the creator. But it is important that the non-fungible token format is digital or converted to one.

The process of creating a non-fungible token is called “minting” and refers to converting a digital product into a resource and uploading it to the blockchain. In order to be loaded, the user needs a cryptocurrency such as Ethereum to store in the digital wallet compatible with the non-fungible token. When the creators of a token upload it to the blockchain, they can choose to impose a clause that specifies that, on any future sale, they will have a share, thus generating a passive income for them.

Like any type of physical collectible, digital collectibles can be sold in various ways, primarily a fixed price sale or an auction. In the case of the fixed price sale, the user sets the sale price directly. In the case of auctions, the aim is to close the sale at the highest price received from the participants, starting from an initially set price.

Safely storing NFTs is also essential. 

Owning a digital wallet is an important factor for any cryptocurrency user and holder. Many phishing attempts and wallet hacks have resulted in the losses of many valuable NFTs, so collectors need to safeguard their collectibles carefully. 

In the future, non-fungible tokens will have a huge development potential in close connection with the Metaverse. Entire communities already are built around NFT collections. As these communities grow, the utility and creativity around their NFTs will also grow.