For some consumers, digital fashion is a natural extension of applying social media filters on platforms such as Instagram and Snapchat, says Simon Windsor, cofounder and joint managing director at Dimension Studio, an agency that worked with Balenciaga on its video game. “We’re just at the tipping point of this new era.… It starts to change the meaning of fashion itself.”
Interactive, creative digital spaces are a natural evolution of how people use technology, and they reflect the ever-growing amount of time consumers spend online. Gen Z spent an average of eight hours per day on screens in 2020.
Nonfungible tokens, or NFTs, are one aspect of virtual environments that have seen an explosion of interest. NFTs are unique crypto assets whose authenticity and ownership are verified on blockchains and are bought, sold, and exchanged in the metaverse, often with cryptocurrency. In 2021, an NFT created by digital artist Mike Winkelmann—also known as Beeple—was sold at Christie’s auction house for a record-breaking $69.3 million.
In the form of a JPEG image that you download every day just with the twist of technology with NFT. So, what is the new tech-ware that is taking the internet by storm, and is it just another cryptocurrency?
To understand what is NFT and how you could probably make a profit out of it?
What are NFTs?
The term NFT stands for non-fungible token and did that just bounce off your head? Well, for us too in the beginning.
The non-fungible token means that a digital asset or digital art is tokenized so that to make sure that we know who the real owner is in the sea of people on the internet.
Let’s keep the terms simple and go by an example, you have visited a museum, and you spectacle the creation of the Mona Lisa. The painting is immaculate and you are stunned by it. In the process, you take a picture or two of the painting. Now you have a digital copy of it. But you are not the owner of the painting and nor can you take it home to hand on your wall (wish we could).
Here comes the star of the game called NFT. NFTs are like proof or license that you are the verified and real owner of the property.
Mona Lisa can be copied but the real painting is always real and can never be duplicated. Similarly in the world of digital art such as images, videos, GIFs or even tweets (I know right, even tweets!) can be owned with a token called NFT. These NFTs can be sold for money and the ownership changes to the latest owner.
So, now the question arises are NFTs just like money or cryptocurrencies with which these digital assets can be bought?
NFTs VS Cryptocurrencies:
The answer to the above question is NO. NFTs and cryptocurrencies and two different parts of the same technology called blockchain which we will cover later in the article.
NFTs are digital assets. They can be an image, a video a GIF, or an autograph but make it digital or even a tweet that can be sold for money and ownership of the same. It’s like buying Mona Lisa’s original digital copy which is the only one in the whole world. It’s like owning a digital asset.
Meanwhile, cryptocurrency is just like money but, make it digital. With cryptocurrency, one can buy many things or exchange the same cryptocurrency with another. Like you can exchange bitcoin for Ethereum both being a cryptocurrency. Or you can exchange the cryptocurrency for stocks or other forms just like money.
Therefore, it is critical to note the key features of NFT and what makes it different from cryptocurrency:
- NFT is non-fungible, meaning they cannot be exchanged for something else since they are not of the same value. Like one cryptocurrency is always equal to one cryptocurrency but the same is not applied with NFT because the value of the NFT or digital asset depends upon the scarcity of the asset. A Mona Lisa painting does not have the same value as any other painting.
- NFTs work on the blockchain which is a distributed public ledger for transparency and easy verification.
- Indivisibility: NFTs cannot be broken down further. Just like a plane ticket cannot be torn into two pieces and used by two people similarly, NFTs are a single unit or entity.
- Uniqueness: every NFT is uniquely secured by the tokens that are attached to the asset which contains the history and information of the ownership and such
- Ownership: there can be only one owner at a time of NFT. There are no partial divisions in ownership of NFTs. These NFTs are controlled and secured by the blockchain method which is an online ledger with private keys and metadata.
- Scarcity: the value of the NFT is not stagnant or always the same. They depend on the scarcity or rarity of the digital asset. For example, if the asset is only one in the whole world then the value will increase manifolds when compared to assets that have more copies or original editions available.
Having understood the crucial key points of the NFT, let’s have a look at why NFTs have a value to them as they can be easily downloaded from the internet:
Why is there a value attached to NFT?
As you may be wondering, what makes NFT special if I can just right-click on the image or GIF and download them instantaneously? You are right! You can download the digital art onto your computers but that doesn’t give you legal rights or ownership over the digital art. You just have copied the art and you do not own it.
NFTs are a method or procedure to own digital art or collectibles and have legal rights of ownership over them. Even the founder of Twitter converted his first tweet into an NFT and sold it for a million dollars. It means that he is giving them ownership of the NFT here tweet over to someone.
The value of the NFT is largely governed and controlled by the rarity and scarcity of the asset. If the digital asset is rare then the value will increase simultaneously, whereas if the digital asset is commonly available by multiple platforms then, the value of the NFT will drop due to the competition between the platforms on who will give in the lowest price.
Moreover, NFT is secure and cannot be broken thanks to blockchain technology and online ledger directories. These techniques make the decryption and dismantling of the ownership of the asset quite impossible.
All about the NFT Marketplace
NFT marketplaces are the places where you sell your NFT creation and the place where your digital wallet should be connected.
There are two types of marketplaces in NFTs: universal non-fungible token websites and niche peer-to-peer marketplaces.
Some of the well-known and comprehensive marketplaces in the game of NFTs include the following:
- OpenSea provides a wide range of diversity and inclusivity to both creators and collectors. Collectors can find various rare and original items on sale such as trading cards, pieces of art, sports, and more. It is possible to build your creations with minting instruments available but you would need to know a thing or two about the technical side.
- AtomicHub: the next up in line for the NFT marketplaces includes AtomicHub which makes use of wax blockchain. Here, the users can trade in terms of wax coins specially designed for the site.
- super rare: as the name suggests, to get into the site and trade in this marketplace you need to be verified and a proven author with distinguished artworks. This way the site ensures only the creators can display their artwork and the collectors get the best value. Therefore, sign-up and verification processes can be tough to pass. Here, Ethereum is a must for any transaction
How can your own create NFTs?
With NFTs sky is the limit. Anything digital can be converted into an NFT and sold off on various marketplaces. Digital assets start from images, videos, tweets, GIFs, or other forms which can be converted into a digitized version of the physical art.
NFTs are the most versatile form of digital assets. Your NFT could even be virtual real estate, virtual worlds, fashion, and much more. Research shows that 83% of millennials prefer businesses that are aligned with their values.
One of the LIVE examples could be the NFT created by Taco Bell for the Live Mas Scholarship, all their NFTs were sold in under 30 minutes. Another little-known Chinese virtual sneaker brand called RTFKT designed an NFT sneaker for the Chinese New Year and put it up for auction. The NFT was sold for $28,000 keeping in mind that the sneakers cannot be touched let alone wear them.
With the blockchain technology backing the NFTs we understand that people are ready to pay for great experiences and collectibles. It is the newest way to interact with your audience and create memorable pieces.
Therefore, it becomes quite crucial for you to move with the technology and use it the right way to disrupt the market (yes you can too do it!) and be quick to embrace all the latest trends and fads coming your way. Adapt to the newest and craziest technologies and get on the bandwagon.
Here are the simplest steps to keep you in check while creating NFTs:
- First and foremost, you need to create an Ethereum wallet that will contain cryptocurrencies. You need some Ethereum to buy, sell, and create NFTs. They help you carry your wallet wherever you are. Hence, digital wallets are portable.
- Purchase the Ethereum, which will be used to create the NFT.
- Connect the wallet with the NFT marketplace. This is the place where you will be creating and listing up your NFT for sale.
- Convert your art into a digital file. It could be in the form of TXT, JPG, PNG, MP3, GIF, etc. This could be the turning point of the artwork. How do you showcase the art, is it animated, lookalike the real, and so on?
- One of the simplest ways to create NFTs is through NFT creation services by MapleSage.
- Price your art and list it on the marketplace so that you have your wallet connected. You can even set if you want to share after you sell the NFT and from the future selling since you are the original creator.
- Let the bidding start.
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