Non Fungible Tokens, or NFTs, have been all over the news lately. The latest version of digital currency is having a moment as everyone gets in on the craze. Here’s a quick breakdown on what they are, how you can get one, and what to do with them.
The world is buzzing about non-fungible tokens.
NFTs are the latest craze in digital currency. Superficially, it looks no different than buy art digitally. NFTs are unlike other forms of cryptocurrency in that they are blockchain-based assets. People are able to exchange Bitcoins with other Bitcoins or equivalent amounts in other digital currency. This is not the case for NFTs. NFTs are unique to themselves. This gives people the chance to own a specific token.
The owner of the digital image can then resell the image for a profit or a loss based on the future of the market. This means that the NFT you buy today could bring in a big profit or a breathtaking loss.
There is a lot of concern about the environmental impact creating the NFT community is causing. According to The New York Times, studies are showing that creating digital art to sell as NFTs is creating large carbon footprints that are negatively impacting the environment. Some in the community are looking for a solution while others think there is no changing the environmental impact.
There is still a lot of debate about how NFTs really work.
There is one explanation that is going viral on Twitter and has caused a whole discussion about what NFTs really are and how they are valued. Like all sellable items, NFTs get their value from supply and demand. Their irreproducibility adds to their value because it is a unique item that only you own, much like a piece of art.
The first high-profile piece of art to sell as an NFT was Mike Winkelmann’s “Everydays: The First 5000 Days.” Winkelmann, also known as the digital artist Beeple, created a new piece of art every day for more than 13 years. The collage of these pieces of work sold by Christie’s for $69,346,250. The buyer was Vignesh Sundaresan, the founder of the Metapurse NFT project.
Yet, it is important to know that buying an NFT gives you ownership of the art, not the copyright.
“I think that people don’t understand that when you buy, you have the token [or NFT]. You can display the token and show you own the token, but, you don’t own the copyright,” Winkelmann, told CNBC Make It.
NFTs are part of the Ethereum blockchain.
As the popularity of NFTs continues to spike, so does the value of Ethereum. This means that if you want to get serious about the NFT investments you are seeing, you should consider getting yourself some Ethereum.
You can set up an account on Coinbase to start buying Ethereum if you are interested in joining in on the craze. Coinbase is a digital space where you can trade cryptocurrency.
If you want to get more into NFTs, check out mitú’s NFTs on OpenSea.
mitú is offering three different NFTs of the beloved Guacardo. The animated avocado is being sold in three “Lord of the Rings” inspired images. The bidding starts at 0.1 Ethereums (about $27). You can see the images on the mitú OpenSea page where the bidding has begun.
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