What is NFT?

The abbreviation NFT stands for "Non-Fungible Token." To understand tokens, it is necessary to understand in what environment they exist - in this case, in the blockchain.

Simply put, a blockchain is a database that is simultaneously stored on a huge number of computers. In the traditional Internet model, all devices are connected to centralized nodes (in the form of servers or Internet providers), while the blockchain works differently. It does not provide for any central nodes; in its system, all devices store all the information published in the blockchain.

The tokens, in turn, are an entry in a ledger within this blockchain. A distinctive feature of most tickets is the principle of fungibility. It can be compared to a currency (including cryptocurrency): one dollar, one ruble, or one bitcoin can be easily replaced with one dollar, one ruble, or one bitcoin belonging to other users.

However, not all digital assets are fungible. The picture of Pablo Picasso is different from the work of Claude Monet, and a recording of Eminem's concert can hardly replace the mp3 file with the song by The Beatles. Therefore, the format of non-fungible tokens was created to transfer unique items to the blockchain.

What can be sold in the form of an NFT?

Anything. Music, images, text, video, 3D models - that is, any digital product that claims to be unique:

Yuga Labs announces that particular attention is paid to NFT by collectors (who, if not them, will search for unique items), gamers (who are interested in in-game items: skins, weapons, collectible cards, etc.), and figures and art lovers. Moreover, art in all its manifestations.

Singer Grimes (the mother of a boy named XÆA-12, the child of Elon Musk) sold her drawings in NFT format for $5.8 million, and Russian artist Pokras Lampas sold a projection of his drawing at the Chirkeyskaya HPP for $28,000.

I created NFT. What should I do now?

Many platforms work with NFTs. Some are highly specialized marketplaces and differ in the categories of objects sold: somewhere you can find only items for video games, somewhere - digital art.

Well-known services include OpenSea, Rarible, Niftygateway, and super rare. The platforms take a commission in ethers (this is the name of the exchange unit of the Ethereum cryptocurrency - based on its infrastructure, non-fungible tokens were created). The commission size varies but is usually calculated in tens of dollars.

Some services immediately generate a token from the uploaded file (and directly charge a fee), while others create NFTs only at the time of sale.

We have yet to hear of NFTs. Did they appear recently?

Although blockchain and cryptocurrencies have been around for years, NFTs are a relatively new phenomenon.

Tokens of this kind were created in the mid-2010s, but the first NFT projects became available only in 2017. The popularization of NFTs, with which people now earn millions of dollars, was originally the merit of CryptoKitties, a game where you can breed virtual cats. The game became extremely popular, and the amounts you can sell digital pets exceeded $100,000.