Metaverse NFT – What is it?
Metaverse NFT and YOU!
What is Metaverse NFT? They aren’t exactly the same thing, but they can work together. You can learn more about the metaverse specifically in this article, What is the Metaverse?
Here, in this article we will be looking at what are NFT’s and why are they so popular, and how do they relate to the metaverse.
What Are NFTs And Why Are They So Popular?
You may have heard of NFTs but are not sure what they really are. In this article, we will explain what NFTs are and why they are so popular right now. NFTs have not been around for long but in the last year, some have sold for millions of dollars.
A Unique Digital Asset
The best way to describe an NFT (non-fungible token) is that it is a unique digital asset. Non-fungible means that it cannot be replicated or replaced. This is the complete opposite of fiat currency such as the US dollar. Every one-dollar bill has the same value as every other one-dollar bill. If you own one Bitcoin it will have the same value as all Bitcoins.
NFTs have different values. You cannot replicate one NFT with another. When you purchase an NFT you will receive full proof of ownership. The NFT record is immutable and cannot be changed so it is a very secure way to trade digital assets.
All NFTs are Traded on Blockchain Platforms
Blockchain technology supports cryptocurrencies and it also supports NFTs. All NFTs are “minted” (created) on a blockchain platform which is a decentralized ledger comprising many computer nodes. There is a unique block of information about a new NFT created and this forms part of the chain.
Many NFTs are minted on the Ethereum blockchain. This is one of the earliest blockchain platforms. Today, the “gas” fees are high with the Ethereum blockchain so other platforms are emerging which have lower fees. All blockchain records are immutable which means they cannot be changed.
There are Different Types of NFTs
Many people believe that NFTs are only about digital art but this is not true. There are other types of NFTs created from different file formats such as video clips, audio clips, animated GIF files, and more. The first-ever tweet on Twitter was sold as an NFT for more than $3 million.
Instant Proof of Ownership
One of the reasons why NFTs are so popular is because they have instant proof of ownership. Anyone can examine the blockchain record for an NFT and see that it is authentic. Of course, digital files can be easily copied, but there will only be one owner of an NFT.
Think of an NFT as a digital certificate of authenticity. Any digital asset traded as an NFT has this authenticity associated with it. Because NFTs are created and traded on blockchain platforms, their records cannot be changed. It is virtually impossible to steal NFTs.
NFTs have Smart Contracts
Another reason for the popularity of NFTs is that they have smart contracts associated with them. These are pieces of code in the NFT blockchain record that specify the conditions of trading an NFT. For example, there could be royalties built into an NFT so that the original creator will earn a percentage of the sale price each time their NFT changes hands.
NFTs are closely associated with the Metaverse
The majority of existing metaverses have NFT marketplaces where users can purchase and trade unique items that relate to it. Experts believe that NFTs will provide the foundation for metaverse economies. Metaverse users want to customize their avatars and own things and NFTs are the best way to do this.
