NFT – Non-Fungible Token Explained

By MusaTheGiant

Khanyi is an aspiring painter, she wishes to conduct an online painting exhibition for all her digital artworks.

However, as the exhibition is online, she is worried that her paintings won’t be secure as anyone could easily forge or replicate them.

Her friend Musa came to her rescue with an idea of nft, he suggested that Khanyi could buy NFTs for all her paintings, as NFTs are trustworthy,
easily transferable, and will also maintain her ownership rights on her artworks.

Khanyi had no idea what NFTs were, so Musa stepped ahead and explained it to her that NFTs turn your digital assets into one of a kind by
creating a unique digital signature which defines the ownership of your assets, and that can be bought and sold for real money, cryptocurrency,
or any other asset like a non-fungible token, aka NFT.

Non-Fungible Tokens means that they are not interchangeable and each of them represents unique assets owned by a specific person.

On the other hand, fungible tokens are interchangeable and can be divided into smaller units to form the same value.

For Example:
– A one hundred dollar bill i.e: $100 is fungible as you can exchange it with five twenty dollar bills or two fifty dollar bills, but the painting of the Mona Lisa is non-fungible as it cannot be generated in bulk, even if it is copied, it will not be authentic.

Each nft contains distinguishable information, like who owns the digital asset and who sold it, making them distinct and easily verifiable, as it is impossible to forge such a certificate, it will secure her painting’s originality.

After learning what NFT is, Khanyi was curious to know how exactly NFT works.

NFT basically creates a blockchain-based digital certificate for your digital collectibles, including games, music, art, and many more. This certificate gives your artwork a unique identity.

The underlying technology and the programming language used by nfts are the same as other
cryptocurrencies.

The majority of NFTs exists on the Ethereum blockchain, which is a distributed public ledger that records and keep all the transactions.

However, NFTs are quite different from cryptocurrencies such as Bitcoin and Ethereum, which are fungible tokens, meaning that if you trade Bitcoin or Ethereum for one another, you will have the same value or item in return. On the other hand, an nft is a unique token, therefore, if you try to trade it you may end up with something completely different in your hands.

Crypto Punks is a remarkable example of a nft, it enables you to buy, sell, and store 10,000 collectibles with the proof of ownership being stored on the Ethereum Blockchain.

After exploring how NFTs works, Khanyi was convinced and bought NFTs for all her paintings. Due to this, her artworks were secured from any kind of forgery and also gave her artworks a particular value. This contributed to increased sales too as everyone was easily able to buy the artwork without any fear.

All in all, her exhibition was a complete success, similarly, nft has proved itself to be a boon in the lives of many others like Jack Dorsey, the CEO and Co-Founder of Twitter with his very first and famous tweet “just setting up my twitter” and Vignesh Sandarsen famously known as
“Medicovan” who bought 69.3 Million Dollars worth of nft art on Beeble.

Owing to its increasing popularity, people are now willing to pay hundreds of thousands of dollars for NFTs.

NFTs has enhanced media exposure and special perks for aspiring artists like Khanyi on social media. This popularity of NFTs creates new
opportunities for new art platforms, motivating people to buy art from internet platforms and promoting copyright or originality of digital
assets.