What are NFTs and what relevance do they have?

 

When people refer to NFTs, many people may think of the bored ape NFTs that have gone viral for their designs and high prices. But how many people know what these NFTs are for and what value they provide? To start off, NFT is an acronym for Non-Fungible Token. Non-Fungible refers to the idea that all of these NFTs are unique and cannot be copied by anyone. They are one of a kind to their respective owner. One question that may arise is “What makes NFTs non-fungible, but cryptocurrencies fungible?” The difference between NFTs and cryptocurrencies is that NFTs can not be traded at equal terms, unlike cryptocurrencies which all hold the same value at a certain point in time.

 

NFTs operate by having digital data stored in the blockchain. The blockchain is what allows the NFT owner to be confident that their NFT will not be duplicated or compromised in any sort of protection. The blockchain also allows for NFTs to be safely traded between people on second-hand marketplaces. NFTs are usually based on the Ethereum blockchain, but there are other blockchains present in the NFT community.

 

So after grasping how an NFT operates and what makes it unique, it is natural to wonder what direction NFTs will head in and how they can be applied in a useful manner. Overall, NFTs are seen as proof of authenticity and ownership, so they can be used for many different purposes. This includes art work, music, trading cards, and creative products in general. In addition, NFTs can be put to further use by applying it to tickets for concerts/sports/travel, real estate ownership, licenses, and other documentation. NFTs are definitely worth paying attention to as they will most likely become increasingly relevant in the crypto community and real life circumstances alike.