Welcome to the world of ‘NFTs’

Recently, Digital collectibles known as “NFTs” have exploded in popularity. You’ve probably seen people in your social media feeds talking about NFTs too.

The growing market for NFTs is turning the art, music, gaming and finance worlds upside down.

We will be running through everything you need to know about them.🙂

(🔊 If you want to listen to the AUDIO version of this newsletter, you can do it by clicking here)

You’re probably familiar with this famous tweet by Jack Dorsey, the billionaire co-founder and CEO of Twitter. He is selling his very first tweet as an NFT.

Despite the fact that this tweet is publicly available as a free digital item to look at whenever anybody wants, as of 6th March, the highest offer for buying this tweet was over $2.5 million🤯

What you are purchasing is a digital certificate of the tweet, it is unique because it has been signed and verified by the creator and “only one” of this is existing all over the universe and you own that exact piece.

NFTs, or Non-Fungible Tokens, are blockchain-based records that uniquely represent pieces of media.

The media can be anything digital. Here, “Non-fungible” more or less means that it’s unique and can’t be replaced with something else. For example, our fiat cash are fungible — trade one for another, and you’ll have exactly the same thing or a different thing with same value.

Ownership of these assets are recorded on a blockchain. NFTs are currently kept in the same blockchain logs as a cryptocurrency called Ethereum.

They’re like a unique collectibles in a forever-open store window that anyone can admire, but only one person (or cryptocurrency wallet, to be exact) can own at any given time.

NFTs have received a lot of attention lately because in the last 30 days there has been over $300M generated in NFT sales.💰

Yes, but NFTs are designed to give you something that can’t be copied: ownership of the work (though the artist can still retain the copyright and reproduction rights, just like with physical artwork). To put it in terms of physical art collecting: anyone can buy a Monet print. But only one person can own the original.

Unlike regular cryptocurrencies, NFTs cannot be directly exchanged with one another. This is because no two NFTs are identical.

Like all assets, supply and demand are the key market drivers for price. Due to the scarce nature of NFTs, people are often ready to pay a lot of money for them.

There are several marketplaces that have come up around NFTs, which allow people to buy and sell the digital goods. 

MakersPlace, SuperRare, and Rarible are the sites that specialize in digital NFT artwork. 

Grimes, partner of Elon Musk & mother to X Æ A-12 sold NFTs through Nifty Gateway but there are plenty of others.

NFTs are still extremely new. As an industry, there has to be a lot of work to be done to improve the technology.

The biggest problems we face boil down to building applications that can support larger numbers of transactions.

We know that NFTs are still relatively inaccessible to mainstream users. Right now, only early adopters and speculators are using blockchain-based platforms. We need to lower the barrier of entry to NFTs.

Centralized applications scale much more easily than decentralized ones, giving us one more hurdle to overcome, but this is a problem we’re actively solving.

***

👋 That’s it for this week. I hope you enjoyed what I included this time and have learnt something new🤞

🍻 Consider subscribing in case you haven’t already and share this newsletter with those you feel can get benefit out of it.

 See you on the Internet next Wednesday!