What is a Non-Fungible Token? The Rise of NFT in the Cryptospace
The resurgence of non-fungible tokens (NFTs) underscores the momentum of the cryptocurrency industry. While non-fungible tokens are not a new concept in the industry, we are witnessing a renewed interest in this concept, which has led to a revolution in digital technology.
This infographic vividly illustrates what a non-fungible token is and how it affects newcomers to Bitcoin. Specifically, this infographic will explore what a non-fungible token is, its main differences from Bitcoin, its different forms, and how it works. Finally, this infographic provides some suggestions to help you launch non-fungible tokens smoothly.
What is NFT? The Rise of Non-Fungible Tokens in Cryptocurrency
What is a non-fungible token?
A non-fungible token is a unique digital unit of data stored on a blockchain that proves the ownership and authenticity of a specific digital or tangible asset (including the rights associated with it).
Bitcoin and non-fungible tokens
Bitcoin and Non-fungible tokens Development can be distinguished by their interchangeability or fungibility. Bitcoin is fungible because you can exchange it for another bitcoin or other similar items. On the other hand, a non-fungible token cannot be exchanged for another non-fungible token because each non-fungible token is considered unique and cannot be replaced.
Bitcoin itself has intangible value, while non-fungible tokens represent real-world assets. The price of each bitcoin is determined by market volatility, and the cost of non-fungible tokens is determined by the value represented by the asset.
6 forms of non-fungible tokens
Non-fungible tokens come in different forms. These include:
1. Art
Perhaps the biggest impact of non-fungible tokens is the art industry. Today, people have begun to trade masterpieces and works of art on non-fungible token platforms, and creators and artists have profited by auctioning their non-fungible token art. Most digital artworks are stored on different web servers, while physical masterpieces are kept in galleries, art galleries, art clubs, etc.
2. Real World Items
Currently, real-world items like land and real estate are making waves in the non-fungible token space. For example, with fractional ownership, homeowners can sell a portion of their property to investors by issuing tokens. In this way, investors can obtain benefits by sharing income, giving priority to occupancy, and using properties at low prices.
3. Image
With non-fungible tokens, photos can now be tokenized. If you are a photographer, you can sell title to your images by issuing a certificate. You can also attach a franchise agreement to your non-fungible tokens, earning a portion of the profit each time your non-fungible tokens are sold to someone else.
4. Video
Like photos, video-based non-fungible tokens have artistic and collectible value. Video creators can now sell 10-second excerpts for a whopping $6.6 million . Recently, Douyin released a series of digital assets inspired by popular videos, entering the world of non-fungible tokens.
5. GIF animation
GIFs have been around for a while and have now entered the realm of non-fungible tokens. Now, creators of these moving images can monetize them in exchange. Last March, a link to a GIF that was stored on the blockchain for less than 24 hours sold for $25,000 in an ethereum auction .
6. Music
Artists can now use a non-fungible token platform to put their new music on the blockchain, allowing fans to enjoy and buy content right away.
Some platforms offer inline licensing options that allow fans to earn money by promoting their music on social media. Musicians and their supporters find this arrangement new and interesting, allowing them to connect and interact, helping to create a better music industry for everyone.
How does it work?
Non-fungible tokens are created and stored on the blockchain. Non-fungible tokens represent tangible and digital items that have been “tokenized” and have been given a unique code for their authenticity . When you buy non-fungible tokens, you are buying tokens that represent assets.
Once the purchase process is complete, ownership is recorded on the blockchain and no one can tamper with it. In this way, everyone on the blockchain can verify and track the authenticity of ownership.
With the introduction of non-fungible tokens, creators and artists can monetize their works without dealing with intermediaries such as galleries or record companies. This is the equivalent of leveling the track and helps to eliminate the factors that make art extremely expensive in the art world. At the same time, it also provides buyers with another way to support their favorite creators, because in the digital space, everyone has access to the non-fungible token platform. NFT Drevelopment Company Note: Due to the nascent industry, many non-fungible tokens may try to sell you rights to assets that you do not have the right to transfer, or otherwise sell you short tokens without any legal rights attached to them. Please carefully research your market and non-fungible token issuers to ensure that the tokens you purchase do have enforceable legal rights.
Why good platforms and marketplaces are important to the success of non-fungible tokens
A good platform is critical to the success of non-fungible tokens. The reasons are as follows:
Various fragmented platforms are not conducive to market development
For non-fungible token platforms to thrive, they need a marketplace where everyone can create, sell, and transfer their non-fungible tokens. Ethereum leverages this umbrella structure of the OpenSea trading platform to integrate agreed economic centers into the platform. On the other hand, it is difficult for the market to thrive due to the fragmented trading environment due to different protocols, restrictions and markets.
Increase market users and participants
Increasing participants in the non-fungible token market is a lot like promoting a real-world product. First, you need to build awareness and trust in your brand, and then you can attract new users. Given the increasing necessity of mobile phones in everyday life, taking advantage of this opportunity to create marketplace-like applications can drive customer engagement and allow the marketplace to flourish.
Attract premium members
Ethereum has a high-profile membership, including celebrities, business titans and other public figures. This has contributed to the success of the platform to a certain extent. When an Ethereum project mentioned by an influencer or celebrity has a limited supply to their audience, the platform can better attract new users.
In this situation, there will be a continuous chain reaction. New users will spread the word about the project and bring others into the market. In the end, the asset value is boosted.
build community
Building a network of loyal and devoted users is an important element of the success of a non-fungible token platform. The point is to get the designated audience into membership. To most laymen, the concept of blockchain may sound new, so taking a different approach helps build community.
8 Tips for Trading Non-Fungible Tokens
If you are new to non-fungible tokens, especially note the following:
For sellers:
1. Promote your work
A key factor in the successful launch of a non-fungible token is marketing. For example, publishing a blog can effectively promote your work. Collaborating with other artists or creators can also help expand your market reach because you can reach your collaborator’s audience.
2. Leverage social media
Non-fungible token galleries usually have their own groups and pages on Twitter, Telegram and Discord social media platforms. Leverage the power of technology to be active in these channels. Interact with your followers and share updates on your upcoming projects. Keep in touch with your fellow artists, participate in different forums, expand your knowledge and foster collaboration.
3. Post your non-fungible token on the most popular non-fungible token market
Launching your non-fungible token through a well-known marketplace allows you to reach a larger audience. OpenSea, Rarible and SuperRare are some of the most popular non-fungible token trading platforms used by traders, investors and creators. These spaces are believed to be part of the main camp of non-fungible tokens, where digital art and collections are sold at different prices.
4. Lock down collectors
If you log on to the mainstream non-fungible assets (English abbreviation: NFA) platform, you may encounter collectors. Take advantage of this opportunity to find collectors with a competitive proposal.
For buyers:
1. Prepare a digital currency wallet
Before you can start buying non-fungible tokens, you need a digital currency wallet where you can transfer money out to build your own funds. Make sure the wallet is connected to the non-fungible token market you want to use as a shopping channel.
2. Check the payment method
Most markets only accept ether for payments, as most non-fungible tokens are built on ether. But some non-fungible token gaming platforms accept credit or debit card payments, like NBA Top Shot. Before buying, you must first check which digital currencies can be used to buy non-fungible tokens.
3. Be wary of transaction fees
Every time a homogenized token is purchased, a transaction fee will be incurred. This includes miner fees, which vary depending on the blockchain you choose. Certain marketplaces will charge a flat fee on top of your order total. When purchasing non-fungible tokens, remember to check the associated fees first, then click the “Checkout” button.
4. Minting when non-fungible tokens are released
As a rule of thumb, it is best to choose the date and time when the non-fungible token is released. Otherwise, you may have to pay a higher price! Remember: non-collectors will resell non-fungible tokens at a higher price than the original, so remember to shop around to find the best option.
A bright future for non-fungible tokens
The popularity of non-fungible tokens over the past year has attracted thousands of people to jump on the bandwagon. One of the reasons is its verifiability, so traders can attest to its authenticity. This alone, has been quite creative, giving legitimacy to the market.
Crypto art of non-fungible tokens is particularly transformative for the art world, offering creators, artists, fans and investors an alternative and novel way to collaborate. Given their enormous potential, many see non-fungible tokens as a new means of generating revenue. As the new disruptor, non-fungible tokens are taking the world by storm at a rate of “one ether at a time”, and the future is bright.
If you want to learn more about blockchain and bitcoin, CoinGeek is the best place to learn. Our team explains Bitcoin for beginners , giving you everything you need to know about the digital currency, including key terms and their definitions , as well as blockchain basics NFT genrator.
