What are NFTs, exactly? Non-fungible tokens explained

Essential the same, or similar technology used for cryptocurrencies like bitcoin and ether is used to guarantee the uniqueness of each NFT and to prove who owns it. NFT stands for "non-fungible token." At a basic level, an NFT is a digital asset that links ownership to unique physical or digital items, such as works of art, real estate, music, or videos. It can be online-only assets such as digital artwork or real assets like real estate. Some examples are in-game avatars, digital/ non-digital collectibles, tickets, domain names, and more. When someone buys a non-fungible token, they gain ownership of the content, but it can still make its way over the Internet.

Depending on its characteristics, each piece of land is unique, priced differently, and represented with an NFT. Real estate trading, a complex and bureaucratic affair, can be simplified by incorporating relevant metadata into each unique NFT. For the time being, much of the attention around non-fungible tokens is focused on artwork, gaming and crypto collectibles. Twitter launched its own collection of NFTs in June 2021; months later, it announced plans to verify users' NFT avatars. NFTs are here to stay because the possibilities and the opportunities of NFTs are boundless and go beyond art and celebrities' tweets or photos.

With a plan to add virtual jewellery, accessories and clothing that can be used across social media, the NBA is aiming to expand this revenue stream as far as it can go. The sites listed below are just some of those that sell NFTs, and some such as rising Magic Eden marketplace specialise in the newer, more environmentally friendly Solana blockchain. While there may be many practical applications for NFTs in the future, they're primarily used with digital art today.

But we have seen big brands and celebrities like Marvel and Wayne Gretzky launch their own NFTs, which seem to be aimed at more traditional collectors, rather than crypto-enthusiasts. It would be hilarious if Logan Paul decided to sell 50 more NFTs of the exact same video. NFTs can work like any other speculative asset, where you buy it and hope that the value of it goes up one day, so you can sell it for a profit. Sales have absolutely slumped since their peak, though like with seemingly everything in crypto there’s always somebody declaring it over and done with right before a big spike. Absolutely not, but I’m sure there are plenty of folks in NFT-based communities that are sure they’re still on the gravy train. The founder of Twitter sold one for just under $3 million shortly after we originally posted this article.

As the record sale of Beeple's Everydays – The first 5,000 Days at Christie's proved, NFTs are hitting more mainstream auction houses, too, so these also are worth watching out for. In case you missed it, that Beeple piece went for $69.3 million. Essentially, you can make NFTs from almost anything unique that can be stored digitally and holds value. They're like any other collector's item, like a painting or a vintage action figure, but instead of buying a physical item, you're instead paying for a file and proof that you own the original copy. Read about the Bella Hadid NFT project to see how non-fungible tokens can reach a global audience.

The first known "NFT", Quantum, was created by Kevin McCoy and Anil Dash in May 2014. McCoy registered the video on the Namecoin blockchain and sold it to Dash for $4, during a live presentation for the Seven on Seven conference at the New Museum in New York City. McCoy and Dash referred to the technology as "monetized graphics". This explicitly linked a non-fungible, tradable blockchain marker to a work of art, via on-chain metadata . This is in contrast to the multi-unit, fungible, metadata-less "colored coins" of other blockchains and Counterparty.