Ever since its first appearance on the market back in 2009, it seems that Cryptocurrencies have won a lot of attention and money from many people worldwide for several reasons.
First of all, transactions without any need for intermediaries and the fact that it is almost impossible to hack have given Blockchain technology popularity and credibility.
However, are you familiar with the term “Non-Fungible Token” or its acronym NFT? Whether you have just heard of him or had phenomenal NFT ideas and insights, you will surely love to learn more about him and his benefits.
For those who have just heard of this term, we want to explain more closely what NFT means, shall we?
Non-Fungible Tokens Explained To Absolute Beginners.
An NFT is an acronym for the Non-Fungible token. It represents a non-interchangeable unit of data stored on a digital ledger that can be traded or sold, and it is called Blockchain technology.
NFTs can be in both physical and digital forms. The primary NFT data units are audio, video, and photo. However, today we can find tweets, GIFs and memes as Non-Fungible Tokens.
Since every token is uniquely identifiable, Non-Fungible Tokens are very different from Bitcoin and other cryptocurrencies on Blockchain. Proof of ownership and a public certificate of authenticity is what NFT ledgers claim to provide.
It’s also interesting that Non-Fungible Tokens don’t restrict people from sharing or copying the underlying digital files. In addition, they don’t prevent the creation of Non-Fungible Tokens with identical associated files, and they don’ convey the copyright of the digital files.
What are NFTs Used for?
Non-Fungible Tokens are primarily used as speculative assets. However, they’ve been in the spotlight for the increasing criticism of carbon footprint associated with validating blockchain transactions, energy costs, and their everyday use in art scams. Some critics claimed that the structure of the NFT market is like a Ponzi scheme.
However, NFTs are mainly used to showcase or monetize artwork and ensure the provenance (historical record of ownership) of luxury goods. In short, NFTs enable a real market for digital works of art while fueling unprecedented speculation.
How Does the Non-Fungible Token Work Exactly?
A Non-Fungible token functions as a cryptographic token, but unlike cryptos like Ethereum or Bitcoin, NFTs aren’t interchangeable manually, meaning they are not fungible. Even though Bitcoins are equal, each NFT can represent a different underlying asset and, for that reason, may have an additional value.
Copyright of Non-Fungible Tokens
NFT ownership doesn’t grant intellectual property rights or copyright to the digital asset that a token represents. It’s essential to understand that while someone could sell one Non-Fungible Token representing their work, a buyer won’t receive copyright once the ownership of the NFT is changed.
That’s why the original owner has all the rights to create more Non-Fungible Tokens of the same work. Thus, an NFT is merely proof of ownership that’s strictly separate from copyright.
We want to point out that the time of NFTs has just begun and that it is worth investing in them. What the future brings us in the crypto world is up to us to be patient and optimistic!