What are NFTs?
NFTs or Non-Fungible Tokens are unique, indivisible digital assets created on blockchains. An NFT’s uniqueness is proven by a distinct label that is created with the use of special cryptographic code, and this uniqueness makes it so that no token can be interchanged for another. This lack of interchangeability is what makes it “non-fungible”, unlike say Bitcoin, where 1 BTC is always the same as another BTC in circulation.
While fungibility makes an asset useful as a currency or payment method, non-fungible tokens have found their use as on-chain representations of assets like art, game collectibles, music, and other one-of-a-kind items. Thanks to their unique, timestamped metadata, NFTs can also be used as placeholders for real-world assets like real estate, patents, and voter IDs which don’t have to exist on the blockchain itself. One of the more popular projects in this space today is NBA Top Shot – a licensed collection of NFTs that display animated highlights from basketball history and can be easily purchased using fiat money.
Uses of NFTs
- Art: NFTs can be used to authenticate the ownership of virtual art, which is typically easy to copy. Just like real artworks are verified through certificates of authenticity, NFTs are used to validate and track the ownership of a particular digital artwork. They can also be used to replace the certificate of authenticity of a physical piece of art, which makes it easier for the owner to resell the art.
- Gaming collectibles: Many games feature items that can be traded and purchased. By using NFTs to depict these items, which can depict characters, powers, events, and more, game developers can make it easier for users to conduct micro-transactions and purchases in their games.
- Real-world assets: By linking real-world assets to NFTs, we can digitize the proof of ownership. In real estate, for example, ownership is proved through property deeds. By creating NFTs of these deeds, houses and land can be moved onto the blockchain, making it easy for prospective buyers to view the property’s ownership history. This application is currently limited due to a lack of support from regulators but might see a boom in the future.
- Logistics NFTs: The immutability and transparency of blockchain technology can be leveraged to track the supply chain data of a product. For example, if you buy some cheese linked to an NFT, you could trace its entire history – right from the dairy farm to the market – as well as get information about when it was made and how long it was spent in storage and transit.
The NFT space is still in its nascent stage and will undoubtedly witness a slew of innovations and new use cases shortly. How many of them will turn out to be practical or popular remains to be seen.
How to buy NFTs?
Buying NFTs is a straightforward deal, once you know how to. First, you need to find out what NFT you want. Once you do that, you need to find a secured marketplace that sells that particular NFT. If you don’t know what marketplace to trust, make sure you get it off a well-known Marketplace like Opensea or Cryptopunks.
Once you find the perfect NFT, add your wallet to the platform, for example, your Metamask wallet.
To add the funds to your Metamask Wallet, you just need to purchase the crypto from your Defy account and send the funds to your Metamask wallet. You can use the funds in the Metamask wallet to place a bid on your desired NFT. If you win the bid, you’ll get the NFT in your account, attached to your address.
NFTs & Ideologies
With these NFTs, there are very interesting storylines and ideologies as to how these NFTs came into being. DYOR for the NFTs and try to find out what ideologies match yours, and start bidding for those, with Defy.