NFT is the latest trend of 2021. While everybody speaks about it, there are too few guides about NFT. Along with the company BoostyLabs (visit their site: https://boostylabs.com/blockchain), we will discuss everything that concerns NFT: what it is, what spheres of life it will change, and where we can apply it.
What is NFT?
The interpretation of the acronym (non-fungible token) does not make it clear. To speak briefly, it is a technology that will digitize our interaction with all physical and virtual items.
Let us start with guessing the word token. In blockchain systems, this word means the indication of the essence of the item. Blockchain is decentralization, in other words. It allows storing all the data about every operation in thousands of computers without using a mediator. Bitcoin was the first example of a mass blockchain application. The information about Bitcoins is being kept on computers and constantly updates. You do need a bank to operate this currency.
Then, Etherium appeared. This currency has launched a new term – smart contracts. These are contracts that do not require human control. It is a simple code that is written to work in any case. If you are interested in this technology, we recommend reading about Smart contract development.
- Non-Fungible is the essential word in NFT. It means something that cannot be copied, recreated, or does not have any equivalents. It is easier to use the examples:
- For instance, a dollar is a fungible token. It is equal to any other dollar.
On the other hand, your pet is unique. It has acquired a specific character, and you will not agree to change it for another pet of the same breed. Your phone, automobile, or shoes are other examples of non-fungible things. Though they have been produced equal to each other, your usage has made them unique.
So, NFT is a special certificate of uniqueness. We can attach it to any good. All the information is stored in the token. It makes NTF a document that approves your right to have the item. All the operations you conduct with the token are conducted with the physical item as well.
The NFT technology allows potential digitalization of every item, physical or not. Right now, digital items are ideal for tokenization. Now, these and many other things are tokenized:
- digital art;
- items and collectibles from games: skins, equipment, characters, etc.
- every item in virtual space;
- everything you want.
How Can NFT Change The Industries?
With the token, your belonging is decentralized. It does not depend on any system. A good example is an item from a game. Without a token, you have the item until the developer allows it. With the NFT, you have got a certificate that proves your right to have the item. The same principles concern other digital items. Imagine you’ve created a GIF with a flying cat, posted it, and want to prove that you are a creator. With a token, it is easy. Yes, everybody else can still download the GIF, but you are the only owner. So, what can the NFT token bring to our lives?
- Liquidity of the product. No one will buy something with uncertain originality. NFT eases your ability to sell something. One cannot sell a game sword without a marketplace. With NFT, you can sell the blade in any blockchain game. Your wallet will plug into a game and identify the new owner.
- The interoperability of the items. In the past, every item belonged to a peculiar game or marketplace. Today, it is not an obstacle anymore.
- Owing to smart contracts, complicated operations with digital items are possible. You can lease money depositing your GIF.
Everything looks strange now. We got used to copying and saving anything we want. The NFT tokens are changing the paradigm of intellectual property on the Internet.