Why Non-Fungible Tokens?

Non-fungible tokens are the newest trend to enter the virtual market place. The first tweet posted by Twitter’s CEO John Dorsey sold for almost 3 million dollars. The value of the tweet is derived from its impact on society as well as how significant of an event the token represents. Diametrically opposite to the concept of fungible tokens. Fungible tokens are virtual entities that can be replicated and obtained by individuals in large quantities. Our favorite games let us purchase virtual entities that exist on a network for actual money. Non-fungible tokens are quite the opposite. In order to understand what NFTs are, we must understand how tokens operate first.

What is a token?

A token sounds like a fancy internet term that may be simpler than most people think. Tokens exist virtually on blockchains and a value is assigned to them based on the physical or virtual representation of assets. A token can hold monetary value as long as there is a community supporting it and willing to purchase it. Tokens are different from coins and should not be confused. Tokens are created onto blockchains whereas coins exist independently using their own platforms. There are two types of tokens. The first being a security token that is a token representative of an external asset for example tokenization of land. The second being a utility token which derives value from the demand and supply. The higher the demand for the utility token, the higher the value.

What is a Non-Fungible Token?

Non-fungible tokens are exclusive virtual entities that use blockchain technology. They are differentiated from one another based on their representation of an experience, event or memory. In the past, people decided together and assigned value to everything in society. NFTs provide a digital platform to do exactly that but with greater security and better transparency. The reason why this experience or event has so much value is because it is one of a kind. Tangible non-replaceable items such as the Mona Lisa can be represented using a token on a blockchain network. Since the Mona Lisa holds a sense of exclusivity, its value rises significantly. NFTs are an example of exclusive tokens representative of analogue or digital events that people assign significance too. The higher the significance, the higher the value for the NFT will. The world’s most expensive NFT was a JPEG file called 5000 days by Beeple, that managed to sell for 69 million dollars. Such large amounts simply represent value that people give to exclusivity. NFTs are secure and easier to manage than physical assets and have developed a really large following in recent times. NFTs offer a unique digital connection to the creator of the token that is different from any other type of art. This makes the entire user experience more exciting for communities and fans of different games, movies or even paintings. NFTs also enable artists to prevent forgeries or plagiarism of their work all the while making the release of digital artwork more feasible and efficient. NFTs also pride themselves for being efficient, enabling users from all parts of the world to obtain digital tokens at the press of a button.

Who can buy a Non-Fungible Token?

Non-Fungible Tokens can be purchased by anyone that has access to cryptocurrency or even a debit card. NBA offers people to buy special basketball moments using their debit card while other entities allow purchases using different cryptocurrencies. Ensuring that the purchase of cryptocurrency and NFTs is legal in your country before buying will eliminate all complications related to a secure purchase on an online market place.

Can I create my own Non-Fungible Token?

Most Non-Fungible Tokens operate on the Ethereum network. In order for you to create your own NFT, multiple platforms are available to make the process easier. For starters, download Metamask and create a wallet. Purchase a cryptocurrency, preferably Ethereum because most NFTs are created on the Ether blockchain. Once you’re done with purchasing Ethereum, connect to OpenSea where you can create your own token and put it up for sale.

How to purchase a Non-Fungible Token?

There are various online marketplaces available to purchase Non-Fungible Tokens. They differ based on categories and fields of art. For example, for basketball we have ‘NBA Top Shot’ while for music we have ‘The Musician Marketplace’. All of these markets support Ethereum based transactions making it incredibly easy for users to simply connect their wallet and start making purchases. Non-Fungible tokens can be resold for higher values or kept to yourself if you feel the piece of art is too valuable. Transaction details are stored on the blockchain network and become public record post purchase.

How secure are Non-Fungible Tokens and Blockchain technology?

One of the biggest concerns for anything that starts to generate monetary value is security. Non-Fungible Token purchase and creation has been made incredibly secure using blockchain technology that stores information in blocks and protecting them with difficult algorithms that make hacking into the network incredibly difficult. All transactions made on the blockchain are stored in a public ledger and are verified and authenticated by various databases owned by various users on the blockchain network. Multiple databases ensure accuracy and authenticity of data while ensuring that original versions remain if some of them are hacked. The copies of the data are in all users’ hands enabling NFTs to derive community-based transparency.

Are Non-Fungible Tokens worth the hype?

With an increasing shift to the digital world post-Covid 19, online marketplaces are the future of all marketplaces. With quicker and safer transactions, people across the world can access, purchase and sell artwork at any time making the process extremely efficient. Analogue security is difficult and expensive to manage coupled with human error. Online marketplaces function on machine-based algorithms removing potential for security issues and enabling safer transactions. Will you be purchasing an NFT soon? Go ahead and see what all the hype is about and let us know if you can create something like the Nyan cat GIF and sell it for 630 thousand dollars!

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DIREWOLF Token: 0xbdea5bb640dbfc4593809deec5cdb8f99b704cd2