Welcome guys, in today’s article we are going to talk about one of the most popular themes nowadays and that is NFT. One often, term we hear a lot, but don’t know very much about it are the Non-Fungible tokens as known as NFT’s. With their explosion at the end of last year, they have become one of the most popular and developed market today. Now with all that said ,we are going to skip to their short history and how did they even become a thing ,before learning you what they are and how can you make money out of them .
Table of Contents
- The History of NFT’s
- What are NFT’s
- How do NFT’s work?
- Difference between NFT’s and cryptocurrencies
- Should you invest in NFT’s
- List of the most expensive sold NFT’s
The History of NFT’s
NFT’s didn’t just appear out of nowhere, becoming so popular overnight .Which leads us to the question :when did it all start?
On May 3, 2014, Kevin McCoy, a digital artist, minted the first-known NFT “Quantum.” After its creation (the first NFT) during the next years, a significant amount of development and research of this blockchain-backed technology occurred. Initially the Counterparty platform (Bitcoin 2.0) led to the creation of digital asset’s . But it should be stated that the NFT ecosystem was never intended to act as a database or similar .So that was the beginning of the shift for NFT’s to the Ethereum blockchain. With the start of Ethereum’s initial reign over NFT’s the technology became even popular.
What are NFT’s
Unlike traditional cryptocurrencies, The NFT’s are unique digital items with blockchain-managed ownership(using blockchain technology). When we say it’s a digital item ,it stands for anything that can be a video ,image ,metadata ,audio track ,pictures ,GIF’s and etc . Each NFT(all of the things mentioned above) can be considered as one of a kind .Which is one of the most important reasons why they have value .Giving you the opportunity to own something that is unique ,one of a kind and only yours .The Non-fungible term refers to an asset’s unique qualities and traits that make it completely non-replicable from any other assets .Being stored on a blockchain(like cryptocurrency) ,it makes them resistant to destruction ,replication or theft .They can be verified by the blockchain ,giving them great value as well.
With all this said ,you can probably guess how an NFT looks like , it can be literally any image or picture you can think of (starting from screenshots to real pictures and etc.) . Essentially, NFTs are like physical collector’s items, only digital. So instead of getting an actual oil painting to hang on the wall, the buyer gets a digital file instead. Here are some examples of them so you can see how do they look like.
How do NFT’s work?
An NFT is created or minted from digital objects that represent all these items: art ,Gifs, collectibles or videos ,music and etc.
NFT’s are sold and purchased through online marketplaces and stores . Potential buyers can look through an inventory of assets before choosing the one to buy . They have opened up a completely new way of making money and selling your artwork or anything similar to potential investors or collectors.
Being backed by blockchain technology all the transactions of NFT’s are distributed through the public ledger that records all the transactions, just like cryptocurrencies. As said above NFT’s are held on the Ethereum blockchain , although other blockchains support them as well.
Difference between NFT’s and cryptocurrencies
Being backed by the same technology and placed in the same ecosystem doesn’t make them the same . NFT’s are not the same as cryptocurrency .The biggest difference is related to their name ,”Non-fungible” which means that an NFT has a unique digital signature that makes it impossible to be changed for or equal to one another .Which isn’t the same with cryptocurrencies and money (they are Fungible) meaning they can be traded or exchanged for one another .They can be also equal in value ,a dollar to a dollar is always equal .In simple words ,you can trade for one euro or one Bitcoin for another euro and another Bitcoin ,but NFT’s don’t trade equally.
Should you invest in NFT’s
Just because you can buy NFT’s ,doesn’t mean you should.
NFT’s are like cryptocurrencies and are a very risky market ,especially since they are so new , in difference to the same cryptocurrencies who are at least some time longer apart of our lives.
Which leads us to the conclusion that investing is largely your personal decision. If you have the money to spare ,you can consider it , especially if a piece hold meaning for you. But the investment should be a small amount ,something you can afford ,around 10% of your earnings (my rough estimate).
The NFT’s value is based entirely on what someone else is willing to pay for it. With that said ,the initial NFT you purchased may resale for less than you paid for it .Or you may not be able to resell it all if no one wants it.
With that said ,you should approach NFT’s with caution just like every other investment(even more),you should do your own research ,try to learn how to understand risks(not losing every cent you invested in it).Take your time ,the guys who made a fortune over night from NFT’s did a lot od research and work before that critical moment. Keep a healthy and clear mind and good luck .
List of the most expensive sold NFT’s
The Merge ($91.8 Million)
Taking the number one spot as the most expensive NFT ever sold, The Merge is the creation of famed digital artist Pak. Pak is another big name in the NFT space, having created some of the most iconic artworks out there. The artist’s actual identity remains a total mystery, but that hasn’t stopped them from having a massive presence in the digital art space.
The First 5000 Days ($69 Million)
In its first-ever digital art auction, the auction house Christie’s sold a massive compilation of artworks by Beeple for a record-breaking sum of 69 million. Beeple has been making artworks every day since May 2007, not missing a single day.
Clock (52.74 Million)
Dropped in February 2022, Clock was developed by Pak and Julian Assange to assist with the controversial WikiLeaks founder’s legal fees. Assange has been imprisoned in the UK for several years, and his situation is hotly debated among those concerned with privacy and censorship both online and off.
Human One ($28.9 Million)
This is yet another NFT from Beeple, and, while it’s not the artist’s most expensive creation, it may just be their most unique. Unlike most NFTs which are exclusively digital, Human One is a hybrid design that also combines physical elements.
CryptoPunk #7523 ($11.7 Million)
A digital avatar selling for over $7 million is undoubtedly impressive, but what about one that fetched a sale price of nearly $12 million? That’s what happened with CryptoPunk $7523, which was purchased by DraftKings’ shareholder Shalom Meckenzie for $11.7 million.
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