What Are Non-Fungible Tokens?

 

NFTs | Image: proactiveinvestors.com

Non-Fungible Tokens (NFTs) are one of the most recent perks the blockchain industry has availed to the world, and its introduction has induced a global rave for this form of monetization, which has otherwise been termed the NFT craze. Since digital artist, Beeple sold the first—and currently most valuable—NFT for a whopping $69 million at Christie's auction house, the world of digital content has embraced the opportunities NFTs have to offer.

{tocify} $title={Table of Contents}

But what are they? NFTs?

NFT is an acronym for Non-Fungible Token as we've seen in the earlier paragraph. Now, the first and ambiguous part of the phrase is "Non-Fungible". Non-Fungible refers to the uniqueness and a lack of interchangeability (ie, fungibility). This means that NFTs are unique and cannot be mutually changed or replaced because no two NFTs are the same. The less ambiguous word in the phrase, Token, refers to any cryptocurrency, without its own blockchain; ie, it is built on an existing blockchain. Now, let's thoroughly define a Non-Fungible Token.

Wikipedia defines it as a unique and non-interchangeable unit of data stored on a blockchain. 

In a simpler form, the above sentence means that a Non-Fungible Token is a form of digital content linked to the blockchain, without any physical form. So, digital tokens serve as a certificate of ownership for those content and their owners. It is common knowledge that no matter how many copies of something there are, the original would always remain, original. Digital tokens are a certificate of their originality and are stored on the blockchain.

This concept of NFT has brought a whole new vibe to the digital content world, as we've seen almost everything digital being sold. An example is the video below, showing Lebron James' slam dunk mimic tribute to the legendary Kobe Bryant, which sold for over $200,000.

How to make/mint an NFT

The process of turning your digital content and art into an NFT, on the NFT-famous Ethereum blockchain is called Minting. For you to turn a picture of your best tweet probably, into a minted NFT, you'll be needing:

• An NFT-compatible digital wallet
• An NFT marketplace
• The native coin of the blockchain you prefer
• The art to be minted

To buttress the whole idea, we would be using the OpenSea marketplace, which mints NFTs on the Ethereum blockchain.

Here are the steps to minting your best tweet into an NFT on OpenSea, 

1. Connect your crypto wallet to OpenSea.io. To do this, tap Create on the homepage of OpenSea.

Tap create on OpenSea's homepage

Then choose the wallet you want to connect it with. The picture shows a connection to Metamask. 

Connect to your preferred wallet

2. On the next page, you fill in the details of your NFT and upload the " soon-to-be-minted" tweet image. As an NFT creator, you are entitled to royalties whenever your NFT is sold; you can also enter your royalty percentage on this page. 

3. Make sure that your wallet is funded with the right cryptocurrency (in this case, Ethereum), and the right amount. Minting is a transaction that has occurred, so it requires a gas fee. OpenSea allows you to purchase some crypto directly by the means of a credit card. And if you don't know the amount required for minting your NFT, don't worry because it will be calculated for you.

4. List your NFT. Tap Sell and your NFT will be listed as for sale. OpenSea charges a 2.5% service fee for listing.

With that said, you could be the next Jack Dorsey selling tweet pics…

Twitter first tweet NFT sold as an NFT by Jack Dorsey | Image: businesspost.ie

How to buy an NFT

There are several marketplaces that allow people to buy and sell/list NFTs, which include OpenSea, Rarible, Mintable, Nifty Gateway, etc. You just have to explore their marketplace and buy what you love.

Tell us what NFTs you like in the comment section.