What is an NFT?
A non-fungible token (NFT) is a type of token on a blockchain that represents a unique asset. These can either be entirely new, digital assets or digital versions of real-world assets. NFTs are not interchangeable with each other, which means they can function as digital proof of authenticity and ownership. Fungibility means that an asset’s individual units are interchangeable and essentially indistinguishable from each other. Currencies like the US Dollar are fungible, which means each unit is interchangeable with any other equivalent individual unit. A ten-dollar bill is interchangeable with any other genuine ten-dollar bill, or two five-dollar bills. This is imperative for an asset that aims to act as a medium of exchange. Fungibility is necessary in a currency because it enables free exchange, and theoretically, there is no way to know the history of each individual unit. However, that doesn't work for collectible items. Instead, we can create digital tokens that are individually unique, indivisible, and that can exist within the same crypto ecosystems as other fungible tokens, like Ethereum and many more. This makes each token different from all the other units: non-fungible. And that's what an NFT is.
There are various frameworks for the creation and issuance of NFTs. The most prominent of these is a standard for the issuance and trading of non-fungible assets on the Ethereum blockchain. However, the process of creating NFTs - called 'Minting' has also been engineered into most well-known blockchains including Polygon, Cardano, Tezos, Binance Smart Chain and Polkadot. Each blockchain has its own separate NFT token standard, compatible wallet services and marketplaces.
Much of the action taking place in the NFT world to this point has been advertised as a democratisation of the art world, but most buyers already understand cryptocurrencies, and have benefitted from being early adopters. Now, collectors, investors, flippers, fans of various artists, and people worldwide buy NFTs.
As cryptocurrencies gain public interest more people will find opportunities to transact with them - providing more reason for more people to take interest. More creators will get paid for selling their work as NFTs.
Digital artists experience a lot of difficulties when it comes to protecting the ownership of their work online. Thanks to NFTs, digital artists can safely sell their works. NFTs and their smart contracts allow for detailed attributes to be added directly into the token — and this is where Infinifty comes in. The fact that your NFT can be so much more than just a JPG means that you can build a pervasive store of authenticity, utility and provenance, which is passed from owner to owner as the NFT is resold, with access credentials locked into the token for only the owner to use.“
Art is one of the biggest and fastest-growing applications for NFTs. The intersection of proof of ownership and scarcity makes it a perfect match made in heaven. Same with physical goods. Buying a digital copy and receiving a physical equivalent is becoming a big business and part of an ecosystem.”- Artur Sychov, founder and CEO of virtual reality platform Somnium Space
NFTs give creators more autonomy, allowing them to produce whatever they like, and select where their work will be sold. Creators receive a royalty when their token is sold and further resold, empowering artists and media creators to realise a better, more robust, value for their work.