WHAT IS NFTs?

NFTs are assets with a unique code that makes them one-of-a-kind. Since they’re non-fungible (or non-tradable), you can’t equally trade one NFT for another. For example, a penny is a fungible token because it’s not unique–you can trade it for virtually any other penny without seeing a change in value. However, a painting like the Mona Lisa is non-fungible because it’s irreplaceable.

Likewise, each NFT represents a unique asset with its own value. When you buy an NFT, you’re buying full ownership of the piece. This means that you can keep it, sell it or display it in your online collection. Other people can look at the file, but you have full ownership and distribution rights. Depending on how they set up the NFT, the original artist might get a portion of the proceeds when you sell your asset.

What Makes NFTs Valuable?

NFTs are valuable because they give you full ownership over the piece. Essentially, it’s like buying an original Georgia O’Keefe painting. Other people can download the file or look at the image, but they don’t own the actual painting. Like traditional paintings from famous artists, there’s only one NFT–and only one person can hold ownership at a time.

When you own an NFT, you own all the value that comes along with it. You can’t sell a screenshot of the piece that you own, but you could sell the actual NFT for potentially thousands or millions of dollars. You also get “bragging rights” over the meme, video, painting or image that you bought. This comes with a lot of clout if you own a piece by a famous artist or a viral video that’s circulated for a decade.

Since anyone can view the NFT records, you won’t have to prove your ownership to anyone. You’re the certified owner of your NFT until you decide to sell it to another buyer. Some people prefer to display their NFTs publicly while others keep them in private collections.

Are NFTs An Investment?

Ultimately, it’s hard to predict how well your NFT will do in the future. Since each NFT is one-of-a-kind, you probably won’t have to deal with market oversaturation. However, market trends and new technology can affect the value of your NFT when you place it back on the market. Some people have bought NFTs for a few thousand dollars and sold them for a massive profit, while others had to take a price drop when they sold their NFTs.

Many brokers see NFTs as an investment regardless of the piece or subject matter. Like cryptocurrency, NFTs represent the future of online business–and as demand increases, the prices may skyrocket. Later advancements could make NFTs even more profitable and valuable. Nothing’s guaranteed, but their non-fungible nature makes NFTs more valuable than tradeable tokens.

How Are NFTs Tied To Cryptocurrency?

Like Bitcoin, Ethereum, and other forms of cryptocurrency, NFTs are recorded in a digital ledger. This creates a public record of the NFT and who currently owns the asset. Some cryptocurrencies like Ethereum have NFT capabilities that allow people to record NFTs in the blockchain as well as the currency itself. Not all cryptocurrencies have this function, so make sure you do some research before you order currency online.

Most of the time, you can’t buy NFTs directly with cash. You’ll need Ethereum to buy NFTs and create a record of your ownership. The majority of NFTs use Ethereum, although you can buy a few with other types of cryptocurrency. Either way, you’ll need to open a digital wallet and buy cryptocurrency online before you start shopping for assets.

What Are Some Examples Of NFTs?

NFTs are typically digital assets, but an NFT can be just about anything. Here’s a few examples of NFTs that brokers have bought and sold in the past:

  • Popular online videos, including viral videos or clips featuring a celebrity
  • Virtual goods like Fortnite skins
  • Images that became viral memes
  • Tweets posted by celebrities
  • Digital art pieces
  • Sports collectibles and memorabilia
  • Animated GIFs

While most NFTs come directly from artists and individuals, major brands like Taco Bell have sold NFTs for thousands of dollars. These companies often donate the proceeds to charity.

Why Do People Sell NFTs?

For artists, creators, musicians and collectors, NFTs have a number of advantages over the traditional online marketplace. Many creators prefer NFTs because they can sell their art directly and keep most of their profits. They can also collect royalties every time someone resells their NFT, which is unheard of in other marketplaces. NFTs also give creators more freedom in selling their work–for example, a musician could choose the marketplace and set their own price instead of relying on traditional streaming services.

NFTs make information freely available to collectors. In some marketplaces, it’s difficult–if not impossible–to verify who owns the asset. With NFTs, the ownership and authenticity are public record. Anyone can look up the ownership without sifting through false, outdated information. There are no secrets with NFTs and cryptocurrency, making this one of the most transparent global economic systems.

Finally, you can sell just about anything on the NFT marketplace. Normally, you need to visit different platforms to sell art, music, streetwear and other collectibles. With NFTs, you can buy and sell GIFs, videos, memes, artwork, digital assets, streetwear and tickets on the same website. Selling NFTs grants you access to a global marketplace that has just about everything in stock.