What is NFT Crypto? Here's the full explanation

If you are still a beginner in the cryptocurrency world, you will definitely ask what is nft crypto? Now, VCGamers has provided a complete explanation in this article.

Non-fungible tokens (NFT) seem to be everywhere these days. From art and music, these digital assets sell like 17th century exotic Dutch tulips. Some of them cost millions of dollars. Then, what is nft crypto? Why is it so expensive?

But is NFT worth the hefty price tag? Some experts say they are bubbles ready to burst, like mad gold or Beanie Babies. Others believe NFT will still be around, and they will change investments forever.

What is NFT Crypto?

What is NFT Crypto
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what is nft crypto be a question for laymen and beginners who are new to the crypto world. NFTs are digital assets that represent real-world objects such as art, music, in-game items, and videos.

They are bought and sold online, often with cryptocurrencies, and they are generally coded with the same basic software as many cryptos.

Although it has been around since 2014, NFT is now gaining prominence as it is becoming an increasingly popular way to buy and sell digital artwork. The market for NFT is worth a staggering $41 billion in 2021 alone, an amount that is close to the total value of the entire global fine art market.

NFTs are also generally one of a kind, or at least one of a very limited process, and have a unique identifier code. “Essentially, NFT creates digital scarcity,” said Arry Yu, chairman of the Washington Cascadia Blockchain Technology Industry Association board and managing director of Yellow Umbrella Ventures.

This is in stark contrast to most digital creations, which are almost always in unlimited supply. Hypothetically, cutting supply should increase the value of a particular asset, assuming it is in demand.

But many NFTs, at least in these early days, have become digital creations that already exist in some form elsewhere, such as iconic video clips from NBA games or securitized versions of digital art already circulating on Instagram.

Renowned digital artist Mike Winkelmann, better known as “Beeple,” combined 5,000 daily images to create 2021's most famous NFT, “EVERYDAYS: The First 5000 Days,” which sold at Christie's for a record $69.3 million.

Anyone can view individual images or even entire image collages online for free. So why are people willing to spend millions of dollars on something they can easily screenshot or download?

Because NFT allows the buyer to own the original item. Not only that, it contains built-in authentication, which serves as proof of ownership. Collectors value the “digital bragging rights” almost more than the item itself.

Difference between NFT and Cryptocurrency

What is NFT Crypto
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NFT stands for non-fungible token. It is generally built using the same type of programming as cryptocurrencies, such as Bitcoin or Ethereum, but that's where the similarities end.

Physical money and cryptocurrencies are “worth it”, meaning they can be traded or exchanged for one another. They are the same in value—one dollar is always worth another; one Bitcoin is always the same as another Bitcoin. Crypto's functionality makes it a trusted means of conducting transactions on the blockchain.

NFT is different. Each has a digital signature that makes NFTs impossible to interchange or equal to one another (hence, not interchangeable).

One NBA Top Shot clip, for example, isn't the same as EVERY DAY just because they're both NFT. (One NBA Top Shot clip may not even be the same as another NBA Top Shot clip).

Read also: Controversy Ubisoft Launches NFT, Good Or Bad Sign?

What is NFT for?

What is NFT Crypto

Blockchain and NFT technologies provide artists and content creators with a unique opportunity to monetize their wares. For example, artists no longer have to rely on galleries or auction houses to sell their art.

Instead, the artist can sell it directly to consumers as NFT, which also allows them to keep more profit.

In addition, artists can program in royalties so they will receive a percentage of the sale each time their artwork is sold to a new owner. This is an interesting feature because artists generally do not receive future results after their artwork is first sold.

Art is not the only way to make money with NFT. Brands like Charmin and Taco Bell have auctioned off NFT-themed art to raise funds for charities.

Charmin dubbed her offering “NFTP” (non-interchangeable toilet paper), and Taco Bell's NFT art sold out in minutes, with the highest bid coming in at 1.5 wrapped ether (WETH) equaling $3,723.83 at the time of writing.

Nyan Cat, a 2011-era cat GIF with a pop-tart body, sold nearly $600,000 in February. And NBA Top Shot made over $500 million in sales at the end of March. LeBron James Highlights single NFT sold over $200,000.

Even celebrities like Snoop Dogg and Lindsay Lohan joined the bandwagon, releasing unique memories, artwork, and moments as a securitized NFT.

Read also: Instagram Starts NFT Implementation Trial This Week

So, if you are still asking what is nft crypto? Then the answer is a future asset that is very valuable and cannot be copied and pasted easily. 

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