NFTs, or Non-Fungible Tokens, are all the rage right now. But what are they exactly? How do they work? And why should you care? In this article, we will answer all of those questions and more.
We’ll discuss what NFTs are, how you can buy them, how safe they are, and what benefits they offer. Plus, we’ll take a look at some of the exciting possibilities that NFTs hold for the future of the internet. So whether you’re a seasoned crypto investor or just getting started, read on to learn everything you need to know about NFTs!
What is an NFT ? and how does it work ?
NFTs are digital assets that are stored on a blockchain (learn more about blockchain here). Unlike traditional cryptocurrencies, NFTs are not interchangeable. Each NFT is unique and can be bought, sold, or traded like any other asset.
So how do they work? When you buy an NFT, you’re actually buying a token that represents the asset. The asset could be anything from a piece of digital art to a virtual world land plot. And because the token is stored on a blockchain, it can’t be duplicated or destroyed. This makes NFTs ideal for storing valuable digital assets.
What is a wallet?
A wallet is a digital place to store your NFTs. Just like you need a physical wallet to store your cash, you need a digital wallet to store your NFTs. To store my NFTs or other cryptocurrencies I’m using the Ledger Nano X from Ledger which allows me to externally store my currencies/NFT with an USB. For a digital wallet I’d choose Coinbase (see review here) or Blockchain.com
Your wallet is important because it secures your NFTs. If you lose access to your wallet, you lose your NFTs. Wallets are secured with a seed phrase. This is a string of 12 or more words that you can use to recover your wallet if you lose access to it. Make sure to store your seed phrase in a safe place, a password vault would be, for example, an excellent choice. (Click here to learn more about passwords vaults)
Ledger review
Ledger is one of the big names is the wallet world, having excellent fiability and having a highly rated app, this brand knows how to satisfy their customers.
| PROS | CONS |
|---|---|
| +5,500 assets supported | Poor customer support |
| Two-factor authentification | |
| Low price for the Nano S Plus | |
| Beginners friendly |
Be sure to check out their website here.
Blockchain.com review
Used as an exchange platform as well as a wallet, blockchain.com is undoubtedly one of the most popular digital wallet you can find. With over 80million wallets, you can buy, sell, store and swap cryptos and NFTs in seconds.
| PROS | CONS |
|---|---|
| Security | Poor customer support |
| Blockchain Wallet is available in 25 languages and over 200 countries | |
| Two wallet option | |
| Beginner friendly |
Learn more about blockchain.com here
Can anyone buy some NFT ?
Yes, anyone can buy NFTs! All you need is a cryptocurrency wallet that supports NFTs. Most NFT platforms require you to buy with crypto, however, some platforms such as FLOW blockchain from Dapper Labs allow other forms of payments such as credit cards.
Are NFTs safe?
NFTs are stored on a blockchain, which makes them incredibly secure. Because they are stored on a decentralized network, there is no single point of failure that could be hacked. Additionally, each NFT has its own unique code that can’t be duplicated or altered. This makes them nearly impossible to steal.
NFTs with utility can’t be used by anyone else because access will be denied if the NFT owner doesn’t have the legitimate NFT. This is because each NFT has a specific code in the smart contract that ensures its legitimacy. If that code doesn’t match the contract, access will be denied.
Anyone can copy and paste the art itself, but they won’t be able to use the NFT with the true benefits that it’s intended to give.
Copyrighted NFTs such as digital art may have restrictions on how they can be used. For example, if it’s intellectual property, the artist may have copyrighted it and you would need their permission to use it. Typically sentences/punishment for copyright infringement includes fines and/or jail time depending on the severity.
What’s the process of making money with NFTs?
There are a few ways to make money with NFTs. The most common way is to buy low and sell high, just like with any other asset. You can also earn interest on your NFTs by lending them out or staking them.
Additionally, some NFTs offer a utility that allows you to earn rewards. For example, some NFTs give you access to exclusive content or games. Within these games, you can earn in-game items that can be sold for real money.
On which platform can I buy NFTs
There are many platforms where you can buy NFTs, but OpenSea and Coinbase are the most popular one. OpenSea is an NFT marketplace that allows anyone to buy NFTs. OpenSea has a wide variety of NFTs, including but not limited to digital art, in-game items, and collectibles.
Coinbase, on the other hand is an exchange platform which offers also some NFTs ! (find a coinbase review here)
Could it replace art? Could anything on the internet be sold as an NFT?
Yes, it’s possible that it could replace art. Anything can be tokenized and made into an NFT. This includes both digital and physical assets. For example, you could tokenize a painting and sell it as an NFT or you can tokenize a digital file of music and sell it as an NFT.
What links NFTs to the Metaverse?
The Metaverse is a decentralized network of virtual worlds. NFTs are a big part of the Metaverse because they allow for ownership of digital assets. This is important because it gives people the ability to own property in the Metaverse. In the past, all digital assets have been owned by centralized companies. However, with NFTs, a new world of decentralized ownership is possible. Learn more about the metaverse in this post.
