What is NFT and how you can earn millions on them
Every year new technologies penetrate more and more into our lives, change it, force people to reconsider their views and perceive things familiar to us in a different way. What is NFT, why has art moved to virtual reality and how do people earn millions of dollars from it?
What is NFT and where did it come from?
NFT (non-fungible token) is a unique non-interchangeable digital key created on the basis of cryptocurrency. The NFT cannot be destroyed or replaced with another such token. It is a kind of certificate of uniqueness and uniqueness of a digital object. It is worth noting that the non-interchangeable token does not affect the copying of the file in any way. It only confirms that a particular digital object is owned by a specific user.
With the help of NFT technology, you can sell or buy any digital object – music, image, 3D model, text, game item, etc. Its essence consists in registering a certain ownership right to a specific virtual object in the blockchain. Owner information cannot be replaced or deleted.
In other words, it’s like buying an expensive painting. That is, it belongs to you, but at the same time it can be exhibited in some well-known gallery for public viewing by lovers of fine art. It is also worth noting that anyone can photograph this picture or use a copy of it on the Internet.
The first experiments with NFT technology began back in 2013-2014 in the Bitcoin scripting language. In 2017, a computer algorithm for creating, controlling and providing information about the ownership of something was created on the Ethereum blockchain. (If you are interested in the topic of Blockchain, read our article about Ethereum 2.0)
So what is NFT and does it have a future?
At the moment, not everyone takes NFT technology seriously. In early March, the company Injective Protocol acquired a stencil “Morons” (White) by the famous street art artist Banksy for $95 thousand and burned it live, thus creating NFT.
It is noteworthy that this 2007 work ridicules collectors who buy art objects for a lot of money. The stencil depicts people taking part in an auction where bidding is underway for a painting with the inscription “I can’t believe you assholes are really buying this shit.”.
The very idea of buying virtual items came to us from games. For example, in Dota 2 or CS:GO you can purchase unique items in the form of items of clothing, some artifacts or weapons. For example, one of the devoted fans of the Dota 2 game bought an unusual pink dog (Ethereal Flames Pink War Dog) for $ 38 thousand. She only brings game items to her master character. And there are a lot of such games in which you can buy something for real money.
Avid collectors are willing to pay crazy amounts for the right to possess a rare item. Digital NFT objects may also be among such artifacts. The only difference is only the carrier. In any case, everyone can look at the object and use a copy of it, but only one person has the right of ownership. In the case of NFT, this right is stored in the crypto wallet of the sole owner.
Another game based on the Ethereum blockchain is CryptoKitties, which was launched in 2017. The essence of the game is to buy, collect, breed and sell virtual cats. It is worth noting that each cat is unique and has its own personal NFT. The offspring of two seals gives a new digital character with random genetic characteristics of his parents or mutations. The price of virtual seals varies depending on its rare genes and can reach $1 million.
It is quite difficult to understand what NFT is and why this technology is gradually becoming our new reality. But it is quite possible that in a few years it will be as familiar and accessible to users as paying for purchases using a bank card or phone.