In the last few years, Non-Fungible Tokens or NFT have exploded into a multibillion-dollar industry with new projects launching each day. With celebrities and huge brands adopting and minting NFTs, this new technology has gained massive media attention and is one of the most talked-about cryptos in the world. But if you don’t know how NFTs work, this is the place to be.
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What are NFTs?
Fungible is an economic term that defines a good that is interchangeable with something else, regardless of its value. Non-fungible is the opposite, it’s something that is wholly unique and thus not interchangeable.
NFT’s represent ownership of a unique digital asset in the virtual world. NFTs are constantly emerging in various forms and can represent digital art, music, in-game items and other such collectives. Any real-world assets that are classified as non-fungible can also be digitally represented by an NFT and coded with unique details using a smart contract.
With this knowledge in mind, here is every answer to the big questions regarding NFTs.
Are NFTs a safe investment?
Not really. There are open legal questions, such as how data protection laws and regulations apply to a blockchain, where nothing is able to be deleted. There is little regulation overall, so theft, scams and bugs tend to cause issues, but also have no negative repercussions on those who perpetrate these issues. In addition, NFTs can contain malware, so any offer of a ‘free’ NFT may be dangerous. People also lose access to their wallets and thus can never sell the NFT, or access it again.
How much do NFTs Cost?
The first major problem many face is the cost of NFTs. They are not cheap. Most solid projects on the Ethereum chain sell for a minimum of four figures. If an NFT collection has more than 10,000 in it, the price may be less due to the higher supply. If the number in the thousands is too high for you, cheaper alternatives are available on the market.
Why the hype?
NFTs are popular in the digital art world as they allow artists and creators to make good money, the way they would with physical media. Without something like this available, many artists would find it hard to get compensation for digital work. You may have noticed that the internet is a prime place for art to be sold, celebrities do it all the time. To keep your art safe, and generate wealth from it, NFTs are the the solution.
Although the hype can be too much, NFTs have proven to live up to it, with some NFT creators even donating to charity with their finds, and doing campaigns for Pringles, MAC and the Superbowl to name a few.
Is NFT going to go away?
Cryptocurrency is rapidly infiltrating the mainstream, and although not perfect, NFT is one of them. It is highly unlikely for NFTs to go away. That being said, it is very likely that NFTs will change over time to be something very different from how they began. This is due to the user-centric method NFT employs, as well as changing attitudes to digital art and cryptocurrency overall.
So how do I get involved?
Now that you know about how NFTs work, it’s a great time to start trading. This is where Swytx comes in. Australia’s leading digital asset platform, Swyftx makes trading in popular NFTs easy.
