NFT are Non-Fungible Token, these tokens are units of value that assign to a business model and are closely linked to cryptocurrencies.
This is a relatively new topic since it is growing, to begin to understand it is necessary to know what Fungible and Non-Fungible goods mean.
Fungible goods:
is anything of movable and replaceable character, which is exhausted with its use. Above all, they cannot be put to proper use without being consumed and are replaceable by items of the same characteristic, e.g. a banknote, a house, a car, gold, silver and a variety of items of daily use.
Non-fungible goods:
will be precisely that which cannot be replaced so easily, in other words, they are goods that cannot be exchanged directly with each other.
The most typical example used to explain what a non-fungible asset is is a work of art, which has the characteristic of being unique, unrepeatable and may or may not be associated with a business model.NFTs are unique assets that cannot be modified or exchanged for another asset of the same value, since no two NFTs are equivalent, no two paintings are equivalent.
How do NFTs work?
Cryptocurrencies and NFTs work through the blockchain, in a decentralized way, with blocks or nodes linked and secured using cryptography. Each block links to a previous block, as well as a date and transaction data, and by design they are resistant to data modification.
Like any transaction on the blockchain NFTs are made up of a series of metadata that cannot be modified. This metadata provides assurance of their authenticity, the starting value and all acquisitions or transactions that have been made are recorded, as well as their author.
I classify the NFT in 3 types:
1.-Art NFTs: for works of art, collectibles, GIFs, music, images.
2.-Game NFT: for unique objects in games.
3.-Certificate NFT: for titles, certificates, identities, patents, property rights and others, these are the uses that are in development and I particularly bet that they will bring us many benefits in the future.
Why do people buy NFTs?
The most purchased NFT�s that are in the market are art related, since the purchases are mainly due to liking the design or simply finding it attractive, however, the main objective for now is definitely because they believe that their value will increase.The idea, therefore, is that if I buy an NFT for a certain value, in the future I can resell it for more money.
Although there is another point that is taking a lot of strength in the market and are the projects that sell art to add the social value of a donation, they would be helping the physical or virtual world.
What is the value of an NFT?
What the market or creditor is willing to pay.
Characteristics NFTs:
Unique: This is simply because of the Token in blockchain technology that provides certification that it is unique, and it is so easy and possible to verify in the world of NFTs because that transaction is represented in a ledger generated from a smart contract in addition to being fully traceable.
Blockchain technology: To achieve that uniqueness, they rely on blockchain contract technology. This creates a representation of the original content, which cannot be plagiarized without losing the certificate of originality.
Durable over time: Just as they cannot be duplicated, they cannot be destroyed. Each NFT exists from the moment it is created, and its ownership is proven through the blockchain contract, which is unalterable. The innate properties of the NFT itself are also unalterable by the contract itself that holds them. (Just like when you buy a physical good, only the digital one, moreover, does not deteriorate).
Only cryptocurrencies are traded: Each platform or marketplace chooses the cryptocurrencies it uses to carry out transactions. Among them, the most used are Ethereum�s (ETH), solana (SOL) or World Asset eXchange (WAX) for purchases related to video games.
In addition, they are purchased through specific trading marketplaces, such as Opensea, Foundation or Rarible.
What is an NFT for?
Simply to prove ownership of the asset in question. However, it can also be traded on the buy and sell market in order to earn higher profits than its initial price.The NFT market is gaining momentum as a new method of financial support for artists or projects.
Negative characteristics NFTs
Imitations:Virtual fashion marketplaces that sell items associated with well-known brands for marketing advantage without the brand�s consent.
Scam:There are NFT projects where they promote purchases with the objective not only to buy art but also to use those assets in other platforms, once the collection is sold, the project is eliminated from the internet and they do not continue developing it, leaving the NFT without its main use or the one with which it was promoted.
Difficulty in investing: In the investment world it is necessary to justify or have a basis of price and market in this world of NFTs as well as cryptocurrencies end up being very volatile making the decision to capture investors more complex.
We have seen that the market is growing rapidly and one of the factors that determines this statement is that the market has exponentially increased its volume in purchases and sales, I imagine that when the big technology companies manage to develop their metaverses, many more market niches will open up as more digital products that emulate virtual reality will be needed.Imagine the NFT as real world property titles, it would be a simple way to control the flow of properties and market at the level of authenticity, security, in my opinion it would end with many of the bureaucracies that we see in different parts of the world, especially in underdeveloped countries.
undoubtedly it is very important to start learning about this technology since it will be the daily life of our children, it will be more and more relevant in our daily life and it is always important to be at the height of the events.
