Difference between revisions of "Non-fungible tokens"
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===IPFS=== | ===IPFS=== | ||
| + | Very little data is stored directly inside an NFT. Rather the NFT includes information on where you can find a description of the artist’s name and the title of the work, but that information is not typically on the blockchain itself<ref name="four"> Kastrenakes, J. (2021, March 25). Your million-dollar NFT can break tomorrow if you’re not careful. The Verge. https://www.theverge.com/2021/3/25/22349242/nft-metadata-explained-art-crypto-urls-links-ipfs</ref> The actual artwork is still a link away. NFTs use a system called IPFS, or InterPlanetary File System. Rather than identifying a specific file at a specific domain, IPFS addresses let you find a piece of content so long as someone somewhere on the IPFS network is hosting it. IPFS is a peer to peer file sharing system.<ref name="four" /> | ||
==NFT Marketplaces== | ==NFT Marketplaces== | ||
===Opensea=== | ===Opensea=== | ||
| + | Opensea was founded in 2017 by Devin Finzer and Alex Atallah. It is an online marketplace for non-fungible tokens. <ref name=”five”>Ehrlich, S. (2021, July 8). NFT Marketplace CEO Explains Why The Industry Is Moving Beyond Ideological Purists. Forbes. https://www.forbes.com/sites/stevenehrlich/2021/07/06/nft-marketplace-ceo-explains-why-the-industry-is-moving-beyond-ideological-purists/?sh=34dd1e331fc3</ref> Users can generate NFTs for free on OpenSea and transfer the gas fee onto the first person who purchases the NFTs. OpenSea is based on the Ethereum ERC-721 standard and Polygon (a layer-2 scaling solution for Ethereum).<ref> Author, G. (2022, January 4). How to Create and Sell NFTs for Free. PetaPixel. https://petapixel.com/2021/11/24/how-to-create-and-sell-nfts-for-free/</ref> | ||
===Nifty Gateway=== | ===Nifty Gateway=== | ||
| − | + | Nifty Gateway is Gemini exchange’s NFT marketplace founded in 2018.<ref> Nifty Gateway - Collect Digital Art. (2022). Gemini. https://www.gemini.com/nifty-gateway</ref> | |
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| − | === | + | ===LooksRare=== |
| − | + | LooksRare is an NFT marketplace that airdropped its $LOOKS token to NFT traders on Jan. 9, 2022. In contrast to OpenSea, which keeps a 2.5% cut of all sales on its platform, all of the trading fees (currently 2%) on LooksRare are paid to $LOOKS stakers.<ref> Y. (2022, January 21). LooksRare Surges to $7B Valuation as Torrid Volumes Fuel Staking Rewards. The Defiant. https://thedefiant.io/looksrare-volume-surging/</ref> | |
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==Uses of NFTs== | ==Uses of NFTs== | ||
===Fashion=== | ===Fashion=== | ||
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===Membership=== | ===Membership=== | ||
==Notable Examples== | ==Notable Examples== | ||
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===Cryptopunks=== | ===Cryptopunks=== | ||
===Bored Ape Yacht Club=== | ===Bored Ape Yacht Club=== | ||
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==Ethical Issues== | ==Ethical Issues== | ||
===Royalties=== | ===Royalties=== | ||
Revision as of 08:43, 28 January 2022
Non-fungible tokens, more commonly known as NFTs, are cryptographic tokens on a blockchain with unique identification codes and metadata. They let people tokenize things like art collectibles, and real estate. They can only have one official owner at a time and because they are stored on the blockchain their record of ownership can’t be altered.[2] Non-fungible is an economic term that is used to describe things that are not interchangeable for other items because they have unique properties. Fungible items however, can be exchanged for one another because they do not have unique properties.[2] Unlike cryptocurrencies, which are fungible tokens, they can’t be traded or exchanged at equal value because each is unique. [3] It is impossible for one non-fungible token to be equal to another because each token is unique due to their metadata. NFTs can be used to represent real world items like artwork, real estate, and clothing.[3]
Because NFTs exist on blockchains, they can be used to connect artists directly to their audiences, removing intermediaries and simplifying transactions.
Contents
Technology
Blockchains
Some blockchains that support NFTs are Ethereum, Flow, Binance Smart Chain, Cardano, Solana, Algorand, Tezos, Tron and EOS. [5] Ethereum is the most popular blockchain for NFTs and has two popular token standards, ERC-721 (used for the creation of non-fungible tokens) and ERC-1155 (used for the creation of new semi-fungible tokens) To implement smart contracts, Ethereum makes use of Solidity, an object-oriented programming language created by the Ethereum team and compiled by the Ethereum Virtual Machine (EVM). The blockchain also features its own crypto called Ether (or ETH).[5] The Ethereum transaction fee varies based on network congestion and is usually between $100 and $200 per transaction, which is rather high compared to other blockchains.
IPFS
Very little data is stored directly inside an NFT. Rather the NFT includes information on where you can find a description of the artist’s name and the title of the work, but that information is not typically on the blockchain itself[6] The actual artwork is still a link away. NFTs use a system called IPFS, or InterPlanetary File System. Rather than identifying a specific file at a specific domain, IPFS addresses let you find a piece of content so long as someone somewhere on the IPFS network is hosting it. IPFS is a peer to peer file sharing system.[6]
NFT Marketplaces
Opensea
Opensea was founded in 2017 by Devin Finzer and Alex Atallah. It is an online marketplace for non-fungible tokens. [7] Users can generate NFTs for free on OpenSea and transfer the gas fee onto the first person who purchases the NFTs. OpenSea is based on the Ethereum ERC-721 standard and Polygon (a layer-2 scaling solution for Ethereum).[8]
Nifty Gateway
Nifty Gateway is Gemini exchange’s NFT marketplace founded in 2018.[9]
LooksRare
LooksRare is an NFT marketplace that airdropped its $LOOKS token to NFT traders on Jan. 9, 2022. In contrast to OpenSea, which keeps a 2.5% cut of all sales on its platform, all of the trading fees (currently 2%) on LooksRare are paid to $LOOKS stakers.[10]
Uses of NFTs
Fashion
Games
POAPs
Music
Art
Membership
Notable Examples
Cryptopunks
Bored Ape Yacht Club
Ethical Issues
Royalties
Climate
Artist payments
IP rights
References
- ↑ M. (2020, October 29). NFT Ecosystem Overview. The Nifty Crypto Nomad. https://niftycryptonomad.com/nft-ecosystem-overview/
- ↑ 2.0 2.1 Ethereum. (2022). Non-fungible tokens (NFT). Ethereum.Org. https://ethereum.org/en/nft/
- ↑ 3.0 3.1 Non-Fungible Token (NFT). (2021, December 14). Investopedia. https://www.investopedia.com/non-fungible-tokens-nft-5115211
- ↑ Team, P. (2022, January 25). Top Ten Blockchains Used in NFT Development. PixelPlex. https://pixelplex.io/blog/top-ten-blockchains-for-nft-development/
- ↑ 5.0 5.1 Team, P. (2022b, January 25). Top Ten Blockchains Used in NFT Development. PixelPlex. https://pixelplex.io/blog/top-ten-blockchains-for-nft-development/
- ↑ 6.0 6.1 Kastrenakes, J. (2021, March 25). Your million-dollar NFT can break tomorrow if you’re not careful. The Verge. https://www.theverge.com/2021/3/25/22349242/nft-metadata-explained-art-crypto-urls-links-ipfs
- ↑ Ehrlich, S. (2021, July 8). NFT Marketplace CEO Explains Why The Industry Is Moving Beyond Ideological Purists. Forbes. https://www.forbes.com/sites/stevenehrlich/2021/07/06/nft-marketplace-ceo-explains-why-the-industry-is-moving-beyond-ideological-purists/?sh=34dd1e331fc3
- ↑ Author, G. (2022, January 4). How to Create and Sell NFTs for Free. PetaPixel. https://petapixel.com/2021/11/24/how-to-create-and-sell-nfts-for-free/
- ↑ Nifty Gateway - Collect Digital Art. (2022). Gemini. https://www.gemini.com/nifty-gateway
- ↑ Y. (2022, January 21). LooksRare Surges to $7B Valuation as Torrid Volumes Fuel Staking Rewards. The Defiant. https://thedefiant.io/looksrare-volume-surging/
