Want to Invest In Non-Fungible Tokens (NFTs)? Here Is What You Need To Know
Non-Fungible Tokens (NFTs) are taking the world by storm! Ever since renowned artist Beeple sold one of his artworks for a whopping $69 million, everyone wants to know what NFTs are and how they can get in on the action. NFTs have been around since 2012 with the first NFT being created in 2014. NFTs grew in popularity partly due to the Covid pandemic. Creatives have been using them to generate revenue as seen with the likes of American rapper Eminem who created a Shady Con NFT collection and sold it for $1.78 million.
What are NFTs?
Let’s start by looking at Fungibility. For us to understand what Non Fungible Token means, we have to know what a Fungible asset is. Fungible goods are identical and can be exchanged for the other. Money, oil and bitcoin are examples of Fungible assets. You can exchange your 10 $1 bills for a $10 dollar note and you will still have $10, the value is still the same, it is just in a different form.
However a Non- Fungible asset refers to unique assets that cannot be easily interchangeable for something similar. An example would be collectables such as diamonds, artwork, baseball cards or even limited edition comic books. You cannot exchange it for another one that is exactly like it because it is a one of a kind piece. Take the famous Mona Lisa painting for instance, it is the only one in the world. You can buy a copy of it at a gift shop or even take a picture of it with your phone but there is only one original piece out there.
NFTs are not a cryptocurrency. Yes, you can buy them using crypto and both NFTs and Cryptocurrencies are stored on block chains, cryptocurrencies like bitcoin are fungible and NFTs are not. The block chain is, in simple terms, a public digital record keeping system. The block chain keeps track of digital transactions made using cryptocurrency. NFTs are recorded in a digital ledger in the same way as cryptocurrency, so there’s a listing of who owns each one.
How do they work?
A majority of NFTs are part of the Ethereum block chain. Ethereum is a decentralized block chain system which has its own cryptocurrency called Ether. While the physical product in the case of diamonds and artworks are stored elsewhere, your NFT, stored on the block chain, is proof of ownership. The token is encrypted with information about the creator, the product and the buyer/owner of the product. The block chain also creates a certificate of authenticity.
Both the buyer and the creator of the piece of art receive crypto keys after a digital transaction is made. The buyer receives a private crypto key as proof of ownership. The creator gets a public crypto key that serves as copyright of that asset. NFTs are secure and ownership is easily verifiable.
NFTs can be tied to physical or digital assets. For the first time ever anyone can create something and get paid for it. Twitter CEO Jack Dorsey famously sold his first tweet for $2.9 million after turning it into an NFT. American band Kings of Leon sold NFTs of their latest album and raked in over $2 million. Nike jumped head first into the world of NFT with their very own Crypto Kicks. The NBA is capitalising on the craze by selling NBA Top Shots, a video of LeBron James’ slam dunk moment sold for $200 000. The 2011 meme of the Nyan Cat was sold for $590,000.
The possibilities are endless!
Another great thing about NFTs is that artists can put in built in royalties in their NFTs. This means they get paid a certain percentage each time their work gets resold. Embedding these royalties means the artist will get residual gains.
Anyone can create an NFT. The first thing you would need to have is a digital account. You can open one with The Big Five Marketplace.
The Big Five Token also lets you buy and sell your NFTs quickly and easily.
NFTs are giving content creators the opportunity to monetize their works like never before. This has not only proven to be profitable but it has also opened them up to a whole new audience and the time to get in on this is NOW!
Be Part of the Big Five Marketplace!!!