What is an NFT? (non-fungible tokens)

April 15

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What does NFT stand for?

NFT stands for non-fungible tokens.

What Are NFTs 

Okay, now that we know NFT stands for non-fungible tokens, what does that really mean? The term “non-fungible” refers to a digital file – something unique and cannot be replaced by anything else. For example, Bitcoin is fungible trade one for another bitcoin, and you’ll have the same thing. A one-of-a-kind trading card, however, is non-fungible. If you traded it for a different card, you would get a completely different card. A non-fungible token (NFT) is a type of digital asset that represents a unique item or collection of items. Unlike fiat currencies or commodities, NFTs cannot be exchanged for other assets of the same type. Instead, each NFT is stored on a blockchain and has a unique cryptographic identifier that allows it to be tracked and traded. While NFTs are often used to represent digital collectibles, they can also be used to represent physical assets, such as art, real estate, or even video game characters. The potential uses for NFTs are nearly limitless, and the technology is still in its early stages of development. As the use cases for NFTs continue to grow, it is likely that we will see more widespread adoption of this exciting new technology.

You will hear the argument of people just downloading the NFT image and claiming ownership; however, it’s not that simple. It might be in your possession, but ownership and control of the actual digital assets can easily be verified on a blockchain technology. 

What Is A Blockchain? 

A blockchain technology or digital ledger is a digital record of all transactions of digital assets, which cannot be altered. The blockchain technology stores all the information in a ledger system that has the proof of ownership. The way the data is stored, it is linked together inextricably. Blockchain technology were initially designed only to be used for converting digital currencies, but now they can handle a variety of data. The blockchain shows everything that has been bought and sold. The use of blockchain technology is still in its early stages, but it has the potential to revolutionize the way businesses operate.

The Reasons to Own NFTs

Investing in NFT world is personal and there are a number of reasons why you might want to consider owning NFTs. For starters, NFTs can be a great way to store value. This makes them an ideal investment for those who are looking to preserve their wealth over the long term. Additionally, NFTs can also be used to purchase goods and services. While most NFTs are currently traded on secondary markets, some platforms are beginning to accept them as payment for goods and services. This means that you can use your NFTs to buy things like virtual real estate or in-game items. Finally, NFTs can also be used to Showcase your creativity. By buying or creating an NFT, you can add your work of art, music, or writing to the blockchain and have it forever immortalized. Royalties are also a unique way for NFT artist to build wealth. Every time your NFT creation is sold on a marketplace, you receive a royalty percentage. It is a perpetual royalty payment that is automatically executed by smart contracts. This makes NFTs an ideal platform for artists and NFT creators who want to showcase their work to the world. Here are top reasons for owning an NFT:

Art

Some collectors care less about the money and more about the art. In an era where most of us spend more time digitally, NFTs make it possible for people to own digital art. Before the Non-Fungible Tokens, digital art was difficult to buy, except when artists decided to display it on physical media. More than just a transaction, the NFT space allows collectors to establish a relationship with the artists if they want to. 

For some digital art collectors, the allure is not simply in possessing a one-of-a-kind piece, but also in connecting with the artist behind it. NFTs provide a digital wallet for artists to receive payments for their work, as well as a platform for collectors to reach out and connect with them. As a result, NFTs have created a space where digital art can not only be collected, but also appreciated on a more personal level.

Investment

Whether you are a creator or investor, there’s a lot of money to be made in the NFT space. Nettyart provides our community with resources to guide them as they navigate this space. But just like anything else, investing in NFTs comes with its risk. Do your homework and learn best practices. NFTs offer a wide range of uses. For example, blue chip NFTs can be used as collateral for loans. If you take out a loan using your NFT as collateral, you’ll be able to get a lower interest rate than if you were to use traditional collateral such as cash or stocks. This is because lenders view blue chip NFTs as being low-risk investments. This makes them more versatile and valuable for both investors and collectors.

Social Causes

If supporting charitable causes while investing is your thing, you have so many options! It’s hard to come across a project that doesn’t have a charitable component. There’s a high probability that you can find a project supporting a cause you connect to. The Bored Ape Yacht Club NFT is a great example of a project with a bigger purpose. Not only did the BAYC NFT collection donate $1 million to the country of Ukraine’s official Ethereum wallet address but when Yuga Labs launched Apecoin, 10 million coins went to The Jane Goodall Foundation. 

Utility

Finding projects with utility is essential because it will help you quantify the collection’s value. NFTs with utility go beyond being unique digital assets. Projects like the notable Bored Ape Yacht Club NFT that comes with an exclusive membership to their community, all are proving that you can give value to their community. In this type of NFT, the owner receives benefits, privileges, or rewards that they wouldn’t be able to gain without the NFT. Ultimately, the utility of an nft will help you determine its value.


Benefits of NFTs For Creators

  • Contrary to physical art, NFTs allow artists to have a digital history of who buys there art at all times (unlike physical art, NFTs can always be traced on the blockchain).
  • The ability to access a global market easily! The blockchain network provides anyone around the world to access digital collectibles. NFTs help artists gain greater agency over their work. 
  • Increase in revenue. The revenue opportunities in this space have never been seen before – it’s truly extraordinary. The artist and founder behind an NFT collection can continuously collect royalties of the sale price each time their NFT creation is sold on a marketplace. Digital artist will enjoy royalty payments for as long as the NFT exist. . 
  • NFTs create a new exciting direction for artists that expands their audience. 


Types Of NFTs 

NFTs come in various categories like PFP, Generative Art, Photography, etc. 

  • Artwork
  • Generative art 
  • Music and media
  • Gaming 
  • Real-world assets
  • Real – estate

For a brief overview of the different non-fungible tokens (NFT) variations, click here.


How To Set Up An NFT Wallet 

Now that you understand what are NFTs or rare digital items are and their benefits, it’s time we discuss digital wallets. NFT wallets are cryptocurrency digital wallets that support the non-fungible-token protocol. An NFT digital wallet is required for collecting or investing in non-fungible tokens. Furthermore, it must support the currency you will buy NFTs – for example, Ethereum. To have easy access to as many NFTs as possible, you’ll want a wallet that works with as many blockchains as possible not only ethereum blockchain. When looking to download a wallet, note that it must be compatible with the NFT creator marketplace you want to buy from. You want to ensure your NFTs are secure and safe. For a breakdown of the most popular digital wallets, please click here.

Do NFT Roadmaps Matter?


Most Popular NFT Wallets

There are a variety of NFT wallets available on the market, each offering different features and security levels. When choosing an NFT wallet, it’s important to consider your needs and find one that offers the right mix of features for you. If you own digital currency, you need a digital wallet. When choosing an digital wallet, consider what type of digital currency you will be using it for

  • Metamask
  • Coinbase Wallet
  • Trust Wallet
  • Trezor


How To Create A Metamask Wallet

MetaMask is one of the most popular digital wallets that users can use to receive, transfer, and manage cryptocurrency.

There are many benefits of using Metamask. First, it is one of the most user-friendly wallets available. Second, it is very secure and supports multiple security measures such as 2FA and a hardware wallet. Third, Metamask allows you to interact with decentralized applications (dApps) on the Ethereum network. Finally, Metamask is available in multiple languages. Those who are interested in setting up a MetaMask wallet need to follow a few steps. Right now, MetaMask can be used on Microsoft Edge, Chrome, Firefox, and Brave. Using Metamask is easy.

First, users need to download and install MetaMask. One of the easiest ways to do so is to create an account on a PC or Mac device, but it is also possible to set up an account on a phone.  Click here to continue reading the instructions.

NFT Marketplace you can browse with ETH:


Where Do You Buy Or Sell NFTs 

Cryptocurrency has expanded significantly during the past few years, and many people are wondering about the best NFT to buy. Selling NFTs and investing in NFT art projects is on the rise with and to ensure that you don’t miss out on upcoming NFT mainstream drops, you need to learn more about the best places to shop for NFTs. Learn more about some of the most popular marketplaces, and make sure you take advantage of the next big NFT release. Remember that you don’t need physical money but you need cryptocurrency. Here are a few of the platforms you can use when thinking of buying NFTs.


How To Buy Your First NFT

Step 1: Go to our upcoming NFT project page and check what approval it has on our website. We authenticate projects by looking at these criteria: 

  • Can we identify the creators of the collection? 
  • Is the Art or design original?
  • Do they have a roadmap? 
  • Does the collection have a presence on social media? 

Reading our ratings will save you time and research. Click here to read more about how to buy your fist NFT and browse NFT collections.

Step 2: Check the best NFT marketplaces for projects you can purchase with ETH:

Step 3: In our example we will use Opensea to purchase NFTs while using the Metamask wallet. Once you arrive to the Opensea website, click on the profile icon and it will take you this page:

Step 4: Once you connect your metamask wallet to Opensea, you are ready to shop!

Step 5: In this example, we are going to purchase a Deadfellaz NFT but these intructions apply to any NFT on Opensea that is available for purchase. When you’re ready to purchase, click buy now.

Step 6: Choose the method of payment that works best for you – keep in mind that if you don’t have enough Ethereum in your digital wallet, you can purchase more crypto with a card. (keep in mind that there are additional processing fees)


How To Avoid NFT Hackers 

As the own NFT creator marketplace becomes more mainstream, you will hear stories about people getting hacked. NFT scams are everywhere, and if you’re not careful, you can become the next victim. If you own nfts, make sure to check the following tips to protect yourself.

Here are our top tips to avoid getting scammed: 

  • Always double check emails/links 
  • Avoid DMs from people you don’t know on Discord
  • NEVER share your seed phrase with anyone. 
  • Use a hardware wallet for valuable assets.


How to Secure NFTs

When it comes to safeguarding your NFTs, the most important thing is to choose the right crypto wallet. In order to purchase an NFT, you’ll need to create an account on a marketplace that sells them. In the past, this has typically meant creating a wallet with a private key that’s only stored on your computer. However, most NFT marketplaces now require you to use a software wallet that’s connected to the internet. This exposes your private keys to some level of risk, but it also makes regular transactions on dApps or NFT marketplaces more convenient. Additionally, software wallets are still far safer than buying NFTs with credit cards. The smartest way to secure your NFTs is to use a hardware wallet. Ledger, the cryptocurrency hardware wallet provider is a popular option and recently has launched a marketplace for buying, selling, and transferring non-fungible tokens (NFTs).


The Difference Between a Cold and a Hot Wallet:

There are two types of wallets to choose from software (hot) and hardware (cold) wallets. Hot wallets are less secure, but they’re more convenient because they’re always connected to the internet. Cold wallets are more secure because they’re not connected to the internet, but they’re less convenient because you have to physically connect them to a computer when you want to access your NFTs. So, it’s really up to you to decide which type of wallet is right for you. But either way, make sure you take security seriously and choose a wallet that will protect your NFTs from theft and hacks. Security risk in the NFT world is a real concern and we want you to stay safe and not lose access to your assets.

The Top Real Estate Digital Marketplaces

As the art world goes digital, so does the real estate industry! The rise of non-fungible tokens (NFTs) has disrupted the way we buy, sell, and trade property.  Who would have thought that real estate inside the metaverse was a thing! Here are the top five nft popular marketplaces and click here for a thorough description on each.


Do Roadmaps Matter?

The NFT roadmap is a strategic planning tool for setting outcomes, milestones, and high-level tasks related to releasing an NFT collection. They are not always required, but they can be very helpful in terms of direction and purpose, both to the project creators and to the NFT holders who participate in it. Think about it this way, without a roadmap you are sort of investing blindly into a project without truly knowing what plans they have to continue providing value to their communities. A strong roadmap demonstrates a strong brand strategy and team. A comprehensive roadmap covers the following: 

Long-term goals of the project

Investors will look for the future viability of NFT collections. They want to know what plans you have immediately after launch and a year or more from now. They want to know how you plan to reinvest in the community and how the team is planning to add value and strengthen the brand. 

Important milestones

The roadmap should include important dates or milestones that the team will plan to hit. For example, are there important drops, merch, or giveaways? These milestones will set expectations to the holders and community looking to invest. 

Accountability 

Roadmaps are a way for your community to hold you accountable for the promises you are making. While a project without a roadmap doesn’t necessarily mean it will fail, it does suggest poor planning and a lack of commitment to the purpose and vision of the project. 


Roadmaps we love 

Here are a few projects who we think are doing an amazing job with their roadmaps: 

BAYC NFT

World of Women NFT

INVISIBLE FRIENDS NFT


Top Collections: Blue Chip NFTS

NettyArt was created by collectors for collectors. So it should come as no surprise to you that our team appreciates the creativity behind NFT collections. Every month the team will share their favorite NFT art projects like the Bored Ape Yacht Club NFT and personal tips to help you make better decisions. Click here to read what are nfts.

Blue Chip NFTs are some of the most valuable and important NFTs. They are often created by well-known or established artists and brands, and they often have a high resale value. For these reasons, owning a bluechip NFT can be a great investment. Not only do blue chip NFTs tend to hold their value well, but they can also increase in value over time. As more people become interested in NFTs, the demand for bluechip NFTs is likely to increase. This could cause the prices of these NFTs to skyrocket.

Another reason to go invest in blue chip projects is for the community of passionate enthusiasts backs blue chip NFTs. The people who own bluechip NFTs are typically very passionate about the technology and its potential. This creates a strong sense of community and support that can help to drive the value of these assets higher over time. 

Here are our favorite top collections:

BAYC NFT

Credit: Opensea

The Bored Ape Yacht Club NFT is a collection of 10,000 unique Bored Ape NFTs— unique digital collectibles living on the Ethereum blockchain. This collection has created shockwaves in the NFT community and beyond. The launch of the Bored Ape Yacht Club NFT has been hailed as a major breakthrough for the NFT industry, as it provides a new use case for this emerging technology. The possibilities for what can be done with NFTs are now endless, and the Bored Ape Yacht Club NFT is leading the way.

Yuga Labs is the team behind BAYC NFT, MAYC NFT, Apecoin, Otherside, and Cryptopunks NFT – they are innovative and have one the strongest communities in the world of digital assets. What sets this collection apart from others is its focus on quality over quantity. As the market for nfts continues to grow, the BAYC’s collection is poised to provide long-term ROI for its investors.

World Of Women NFT

One of the most renowned NFT projects is World of Women NFT.  Developed by French artist Yam Karkai, the World of Women NFTs collection consists of 10,000 NFTs. With World of Women, Karkai aimed to empower women and increase their representation in the NFT and cryptocurrency industries. Following the launch of the NFTs on July 27, 2021, several high-profile celebrities (Reese Witherspoon, Eva Langoria) and influencers quickly sold out in 10 minutes. Approximately a month later, WoW had done 745 ETH in trading. Click here to learn more.

Doodles NFT

Doodles NFT is a collection of 10,000 non-fungible tokens (NFTs) that was created by Scott Martin, Jordan Castro, and Evan Keast. While the creators use working aliases, they were already well-established in the NFT community before launching Doodles. In fact, all three creators participated in the launch of CryptoKitties NFT, another popular collection of NFTs. What sets Doodles apart from other NFT collections is its focus on art and creativity. Each Doodle NFT is a unique piece of digital art that can be traded, sold, or collected.

CryptoPunks NFT

CryptoPunks NFT are one of the earliest examples of non-fungible tokens (NFTs), first created by Larva Labs in 2017. NFTs are digital assets that are unique and cannot be replaced, making them highly valuable to collectors. CryptoPunks NFT skyrocketed in value and several have sold for over $1 million. Celebrities such as Jay-Z, Gary Vee, and Serena Williams are all prominent Punk owners, helping to raise the profile of the project. The high prices paid for CryptoPunks reflect the growing interest in NFTs as a new asset class, with investors eager to get in on the action. The rarity and uniqueness of CryptoPunks makes them a desirable collectible, and it is likely that their prices will continue to rise as demand increases. Yuga Labs, the company behind the Bored Ape Yacht Club NFT, has purchased the rights to Larva Labs’ CryptoPunks and Meebits collections.


Basic NFT Terms To Know

Apecoin: The Ethereum-based token ApeCoin is part of the bored ape yacht club world. Despite being ApeCoin’s official token, apecoin DAO was officially created to govern the token and its future.

Asset: Another word for digital tokens or NFTs.

Blockchain: Blockchain technology is a distributed digital ledger that stores data of any kind. A blockchain can record information about cryptocurrency transactions, NFT ownership or DeFi smart contracts.  Think of it as an open spreadsheet that everyone in the crypto world has access to, and it records any changes or transactions. 

Beeple: Beeple is one of the most well-known nft artist. Beeple is an artist who creates nfts. He has created nfts for brands such as Coca Cola and Nike. He has also created nfts for major publications such as The New York Times and Wall Street Journal. Beeple’s nfts are some of the most sought after and valuable nfts in existence. He’s also known for early on selling an NFT $69 million! Beeple is one of the leading innovators in the nft space and his work is highly coveted by collectors and investors.

Blue Chip: They’re considered industry leaders and are more likely to grow than other NFT projects. BAYC NFT , World of Women NFT, CryptoPunks NFT are considered Blue Chip NFTs!

Bored Apt Yacht Club NFT – The BYAC NFT is a collection of 10000 unique Bored Ape NFTs— unique digital collectibles living on the Ethereum blockchain.

Bullish -A crypto investor is bullish when he or she feels confident a cryptocurrency and or non-fungible token (NFT) will rise in price.

Cryptocurrencies: A digital currency in which transactions are verified and records maintained by a decentralized system using cryptography, rather than by a centralized authority…like Bitcoin, Ethereum etc.

Defi: An acronym for decentralized finance.

Digital Artist: Digital art is a term used to describe art that is made or presented using digital technology.

Discord: A group chatting platform originally built for gamers but has since evolved into a platform for all kinds of communities, especially NFT projects.

ETH: This is the abbreviation for Ethereum.

Flip: When you flip something like an NFT or token, you buy and then sell realy quickly to make a profit.

Floor price : The lowest NFT price in any given category of NFTs. To “buy the floor” is to buy the cheapest NFT in a project / collection.

GasAn amount required to perform cryptocurrency transactions on the blockchain. Every time you buy an asset, send ETH, or set up a smart contract, then gas has to be paid in order to run the transaction. Artists must purchase “gas” to mint NFTs.

Generative Art – Generative art is a type of art that is created using algorithms. These algorithms can be used to create anything from images to audio to 3D models. Generative art is often seen as a form of digital art, as it makes use of computer-generated imagery (CGI). Generative art is unique in that it allows for an infinite number of possibilities and variations. This is due to the fact that the algorithms used to generate the art are constantly running, producing new results each time.

Liquidity: When we talk about liquidity, we’re referring to how easy it is to buy or sell an asset. It’s also the ability of a coin to be easily converted into cash or other coins.

Metaverse: A network of socially connected 3D virtual worlds.

Minting: An NFT is “minted” when it is published on the blockchain for purchase.

Offers: Interested buyers of a specific edition of a collectible are able to make offers to the owner in hopes of purchasing the NFT at their desired price.

PFP Project: The term ‘PFP project’ stands for ‘profile picture. As avatars in these NFT collections are often used as profile pictures on Twitter, Discord, etc., the term was coined.

Rarity: NFT rarity decides how rare an NFT is and in turn, how valuable it is. Rare NFTs are most highly sought after by collectors, which pushes their price up.

Roadmap: The development plan for an NFT project. As compared to a project with no foreseeable updates, one with a solid roadmap has greater potential, and longevity.

Rugpull: The term “rug pull” refers to unknowing investors “having the rug pulled from underneath them” by the creators or developers of a cryptocurrency. This can take a number of forms, but the most common type of rug pull is the liquidity scam, which most commonly takes place on decentralized exchanges.

Trait: A distinguishing quality or characteristic in the art of your NFT. A unique trait can increase the value of it. 

Secondary sales: Where a collector, who has bought an NFT, can resell or relist their NFT.

Smart Contract: A contract or a smart digital file between two or more parties that automatically executes under certain circumstances.

Wallet: Digital wallets allow users to store and manage their cryptoassets.

Whitelist:  A list of people who get early and guaranteed access to mint at a specific date and window of time. A whitelist is similar to a VIP list, or a guest list for an event. If you’re on it, you might get perks or even a lower price.

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About the author 

lourdes

Lourdes is an International creative strategist & content creator. She has curated content for the fashion, travel & hospitality industry for over 12 years.