Everyone’s Talking About Them, but What Exactly Is an “NFT?”
It seems like everyone is tossing around the acronym, “NFT” but what is it? Why the popularity? I felt so stupid the other day when someone at work dropped the ole’ “NFT” and all I could do was nod like a clueless bobblehead.
If you’re clueless to what NFT means like I was, I did some research to help explain the best that I can what it means so that if it ever comes up in conversation, you’ll know what people are talking about and be able to jump into the conversation with confidence-ish.
What Is an NFT?
An NFT is a Non-Fungible Token (am I the only one who immediately thought of fungus, like mushrooms?). An NFT a type of cryptographic token. It’s not a type of cryptocurrency because it can’t be interchanged. An NFT is one of a kind which makes it non-fungible. An example of something that would be fungible would be a bitcoin, which you could trade for another bitcoin. When you trade an NFT, you're not going to get the exact same thing back. An NFT can represent items like a one-of-a-kind music album, video, even artwork, basically anything that is digital.
Can I Make Money on an NFT?
Yes. That’s the simple answer. You can buy an NFT and resell it for more than what you paid. Like, when you buy a pair of pants on clearance but then turn around and sell them on Poshmark for their retail price. If someone really wants those pants because they have an emotional attachment to them, they’ll be willing to pay. That’s how an NFT works - people buy them because of the emotional value. They don’t really need the emoji, but there’s something special about how it makes them feel, so they’ll pay for it.
How Can I Buy an NFT?
I had to turn to Coin Desk for help with this answer because it’s still completely over my head even though several people have tried to explain it to me. According to Coin Desk,
...certain NFTs are only available on specific platforms. For example, if you want to purchase NBA Top Shot packs you will need to open an account with NBA Top Shot, create a Dapper wallet and fund it with either the USDC stablecoin or supported fiat currency options. You will also have to wait for one of the card pack drops to be announced and try your luck in trying to buy them before they sell out.
What Are the Best Websites for Buying and Selling an NTF?
Again, Coin Desk to the rescue for the answer to this question. The website says that these are some of the best places where you can buy and sell an NTF: OpenSea, Rarible, SuperRare, Nifty Gateway, Foundation, Axie Marketplace, BakerySwap, NFT ShowRoom, and VIV3.
Wait, NFTs Are Digital Only?
Do you remember the story from a couple of months ago where people were spending hundreds of dollars on digital clothes? They would pay for digital pants, shirts, etc., and then build an outfit. Except the clothes weren't tangible- they were digital and could only be used online. This is is along the same lines as an NFT. Check out the digital clothes story here because it might all start to make more sense in your head if you do.
Are People Really Making Money off Selling NFTs?
You bet! Someone paid over $170,000 for a digital cat. But wait, there's more! There's the digital artist whose work was sold at Christie's for $69 MILLION, and someone shelled out $3,600 for an animated GIF of a Gucci Ghost. Remember, these aren't tangible items that someone can hold in their hands which makes the fact that people are spending crazy amounts of money on them completely mind-boggling.
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