What in the world is an NFT?
NFT stands for Non-Fungible Token. Unlike big daddy Bitcoin or your local 1 dollar bill which are 2 fungible examples, NFTs are non-fungible meaning they are unique assets with different utilities and characteristics that are stored in the blockchain.
But WTF does fungible mean? Stepping back this means that your dollar or BTC look/feel/work the same way. This means you cannot tell them apart and you can use them as money to buy or save for the future (yes you maxis chill as we will go down the rabbit hole later on why BTC is a better store of value, but my fellow newbs here is a sneak peak).
With that said examples of NFTs can be digital collectibles in the form of art, memes, virtual land, sports cards, music and much more.
Why are NFTs important?
NFTs allow buyers to hold ownership of assets in a digital way as these are coded in the blockchain. Yes it’s true can download a video, screenshot a picture or record audio and share it worldwide across the internet. However its important to mention the blockchain here as this is what distinguishes who owns this the asset from one that is copying it.
From a creator perspective this allows an artist or developer to set the rules. These rules can vary and can be things like; how many items does a collection have, what is the percentage of royalties artists make, what is the utility for owners among other things. The fact that artists can decide royalties and have pricing power makes this technology a blessing for creators. If not just read the news on how artists like Taylor Swift or the band Failure get shafted by the likes of Spotify. Yeah maybe we do not care about Taylor Swift shes loaded with tons of $$$$, but your talented stoner cousin from California can now make money and platform himself. All thanks to the magic of NFTs.
Nic Carter , Crypto OG goes more in detail about this here (not the Backstreet Boy)
Although NFTs are a relatively young technology they continue to have increasing utility serving as a token to proof membership of an exclusive community, game pieces/digital characters, real estate deeds and much more.
How did it all start?
History was probably my favorite subject in high school yet you probably want a short and sweet snipped to here are key points and a brief timeline.
In 2009, Satoshi Nakamoto posted the following message on Bitcoins first block. The message stated: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.” This was not an NFT, but a precursor of what was to come as people noticed you could write messages and store them on the blockchain.
2011: Dan Kaminsky launched ASCII art on the Bitcoin Blockchain.
2012-2013: Colored Coins emerged as tokens that represented real ownership of real world items like cars, real estate, stocks and more. These were also on the Bitcoin Blockchain.
2014: Counterparty is launched. This platforms allowed for the creation of a token called XCP, games on the blockchain, and trading cards.
2016-2017: Rare Pepes Launched in 2016. These NFTs were some of the first memes on the blockchain that went viral and gained notoriety in the years to come. By 2017, Ethereum creators announced the first collection of unique Pepes.
- 2017: Breakthrough really comes to the NFT verse with the creation of Cryptopunks. This project was created by John Watkinson and Matt Hall, who through the Ethereum blockchain created a unique set of collectibles. No two characters were the same. These were given out for free and today they are worth several $$$$$$.
- 2018-2021: NFTs are now in the mainstream and have been auctioned in places like Sotheby’s and one of the biggest and costly collections was Beeple’s “The First 5000 Days”
6 Extra Things You Should Know:
- Ethereum is still king, but if you want to get started and do not have money. Try other protocols like Solana, Algorand, or Cardano. More info here
- If you want to learn about NFTs the best place is by getting a wallet like the Coinbase Wallet or MetaMask and load it with crypto from an exchange.
- You can buy NFTs through the following places: Opensea, Nifty Gateway, and Mintable
- Scams happen all the time. I got rugged by some stupid ass hippos. Be patient and ready to lose a bit or a lot of money. The lessons you take will guide you probably into good money or into a better investment thesis.
- The best way to make money in NFTs is to find projects with moats, large communities, brand creations, and doxxed creators (these means creators are revealing their personal details).
- NFTs are for everyone: creators, developers, investors, collectors. You just have to find your edge!
Good luck I am tired now and going to bed.
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