The New Marketplace: Non-Fungible Tokens

 

Bored Ape, an NFT.

Blockchain technology and Cryptocurrency has reshaped several aspects of our daily lives. One notable aspect it has reshaped is the way we buy and sell. We see this in the concept of NFTs.

I present to you Non-Fungible Tokens!

What are NFTs?

NFTs stand for "Non-Fungible Tokens". 

First, let's get the idea behind the word "fungible". What does "fungible" mean?

Fungible (adjective) means "able to be substituted for something of equal value or utility". For example, if I have a thousand naira note, I can exchange it for two five hundred naira notes. 

A Non-Fungible item therefore is an item that cannot be substituted for something of equal value.

NFT stands for Non-Fungible Token and are digital assets that are stored on a blockchain. A blockchain is a distributed database that records transactions.

The Architecture of NFTs:

Since its creation in 2013, Ethereum has been able to support a lot of unique blockchain features such as smart contracts. Ethereum utilizes the decentralised nature of the blockchain. 

It is secure, scalable and able to support features such as smart contracts on decentralised applications (dApps). 

Today, the most popular blockchain to store and trade NFTs is Ethereum. There are other NTFs blockchain that are emerging but Ethereum remains at the top. 

In 2018, Ethereum introduced an NFT standard known as ERC-721 (Ethereum Request for Comments). ERC-721 implements a standard interface between other applications and smart contract driven tokens on Ethereum. 

ERC-721 supports the transfer of NFTs from one wallet to another and the ability to determine the owner of an NFT at any point in time.

How to buy and sell NFTs

Let me guide you in the process of buying your first NFT. It's easy if you follow these steps.

• Get a cryptocurrency wallet: Make sure you get a cryptocurrency wallet that supports Ethereum. A good example is the Metamask wallet.

• Purchase some Ether: Ether is the native token of the Ethereum blockchain network. You'll need it to be able to purchase your NFT and also to be able to pay for your gas fees on the ERC-721 network.

• Select a platform to buy your NFTs: Popular platforms include Opensea, Superrare, Niftygateway etc. Opensea remains the most popular platform for trading NFTs.

• Register on Opensea: Your next step will be to register on Opensea, this will include connecting your cryptocurrency wallet to your Opensea account.

• Buy or sell your NFT: Peruse through the NFT gallery on Opensea and trade carefully. Goodluck.

Future of NFTs

NFTs provide creators of digital assets a marketplace for their works. NFTs also provide a store and marketplace for digital assets. 

They also play a role in preventing counterfeiting physical products. If original physical products could come with an NFT to prove authenticity, it will be a way to reduce the rise in counterfeit products.

Blockchain and Cryptocurrency technology continue to change different aspects of our lives and NFTs are just one of those ways it has done that. The NFT market is one that is promising with a lot of potential, it's worth giving a try.

DYOR as always.

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