NFTs, also called Non Fungible Tokens, are not new to the market. They have become more popular these days as cryptocurrency has gained popularity. Both cryptocurrency and NFTs come under blockchain. In this blog I will explain about NFTs from scratch in easy words.
If you are interested in tech, here is a list of our other tech articles that may attract you.
What are NFTs in layman’s terms
Basically, it is a digital asset which shows real-world objects like art, music, videos and in-game characters and items. NFTs are non replaceable I will explain to you with this example you can replace a dollar with a dollar I will give you a dollar and you can return me a dollar so it is replaceable but if I give you an artwork and you give me another artwork that is not replaceable.There is only one Mona Lisa original copy. It is non replaceable.There is only one Mona Lisa original picture.
In the figure below, here is an example of an ethereum coin being replaceable by giving another ethereum so it is fungible. A dollar is replaceable by another dollar. However, the picture is not replaceable by the video as shown in fig 2.
Now a question will come into your mind, well I can give you a duplicate copy of the same photo. Well, well, there are historians and experts who can do this task of differentiating a real photo and a fake photo.
In NFT, you create a digital copy of the original photo and sell it with cryptocurrency. You can use blockchain for encryption and security purposes so that the digital artwork is not duplicated. For e.g., you can make a digital copy of your photo and sell it. That’s the simple layman explanation.
NFTs have been in the business since 2014. But recently they gained huge popularity. You can see this from the stats. NFTs were sold for 41billion$ in 2021. That’s how big a market is of NFTs.
DIFFERENCE BETWEEN NFT & CRYPTOCURRENCY
There are a lot of differences between NFTs and crypto. NFTs are nonfungible while cryptocurrency is fungible. Each NFT is different and has a digital signature which makes it different from one another. Short clips and GIFs can also be an NFT for e.g., a good basketball moment, an amazing snooker shot, an enormous javelin throw etc. The main thing I want to tell you is that an NFT is not equal to another NFT.
Generally, ethereum blockchain is used for NFTs, although other blockchains also support NFTs. Twitter cofounder sold his first tweet as an NFT for $2.9million.
Benefits of NFTs
There are many benefits of NFTs, some of which are listed below
- Opportunities for talented people
- Economic stability
NFTs provide an opportunity to the artists of anyone who has talent, so sell their skills by making a digital copy. Art workers no longer have to send their paintings to art galleries, there is more monetary benefit in selling NFTs.
Similarly, selling NFTs will not only help that person but also the government as more and more dollars will come to his country, which will help in economic growth and prosperity for that country.
How to start as beginners
As a beginner, don’t get overwhelmed and overexcited. Patience is the key for success. Below are some of the key points for a newbie.
Create and sell your NFTs
If you have any sort of talent in art, gaming, fashion, music make something cool and once you consider you have made a good piece of work, then you can create your NFT by digitizing it. There are many platforms for creating an NFT, such as AirNFTs where you can mint your NFTS for less than a dollar.
Do Invest in NFTs
As NFTs are popular these days, if you invest and buy some NFTs, their price may rise and give you profit.
Flip your purchased NFTs
Flipping an NFT means you buy an NFT for low rates and wait for the right moment when its price gets high and sell it for a greater amount. This is also a good way to make money from NFTs.
Play NFT games
This is also another way to generate money. There are platforms like Axie Infinity, Spinterlands, The Sandbox, Star Atlas, Cryptokitties and Ember Sword. You can explore these platforms and earn money.
How NFT Works
We have understood above what NFTs are. Here we will discuss how NFT works from where we can buy an NFT and sell it. There are different marketplaces where we can get an NFT, such as:
- NBA top shot marketplace
- Nifty Gateway
- Theta drop
Mostly Opensea and Rarible are used for creating an NFTs on ethereum and you don’t have to pay anything. Here lazy minting comes to the rescue, but wait a minute… you might wonder what this lazy minting thing is.
In lazy minting, an NFT is available for sale without writing it on blockchain, so it saves you money. If someone likes your NFT and wants to buy it, then you can add the fees of writing your NFT to blockchain with the transfer fee. If you write an NFT for blockchain and no one buys it, then your money will be wasted, so it is a better approach for selling your NFT.
Tradeoff in Lazy Minting
Here is the catch when you use Opensea to sell your NFT. You have to initialize your account with some money which is $60-70. You have to pay it once after that you can lazymint your NFT giving no money. If you sell your NFT from the rarible or Opensea, 2.5 percent of your sale amount will be given to that platform.
How to make a good NFT
Look, there are millions of NFTs for sale on different platforms. There is a lot of science in it your nft should be unique and attractive. There are very few chances that someone will buy your NFT from millions of NFTs. You have to show something which attracts the buyer.
There is no magic spell for making a nice NFT. You have to be persistent and follow some good people who have successfully built some NFTs. Below is a list of some of the best projects for NFTs:
Discord Servers to Follow for NFT knowledge
If you want to learn about NFTs, it’s better to learn from multiple sources as it will increase your horizon and way of thinking. Below are six discord server links where you can learn more about NFTs. They teach NFTs from the beginning and if you are stuck at something, you can post a comment on your queries and there are many people who will help you.
There is another good NFT learning website, which is Meta Masters Media. You can visit this website and explore about NFTs. Remember, the more you explore, the more you learn.