Before explaining what NFT is, let’s look at what the functional token is.
Fungible Homogenization means that each has an equal face value, so it can be exchanged with each other, similar to the currency we usually use, and the equivalent can be exchanged or used to buy its goods. For example, a $5 bill can buy a hot dog.
Most cryptocurrencies are homogeneous tokens, such as bitcoin and etheric as we know well. Although their prices fluctuate sometimes, the homogeneous tokens can be used as general equivalents for trading because each par value is equal, and have a high level of liquidity.
The full name of NFT is Non functional token, contrary to fungible, is translated into a non homogeneous token, which means that each one is irreplaceable and unique. As there are no two identical leaves in the world, and there are no identical two NFTs in the world, which means that one-on-one exchange cannot be made and transactions are very difficult because of the value evaluation of each.
The simplest example is that NFT, which represents art, cannot be used for exchange, such as Mona Lisa portraits displayed in the Louvre and graffiti by children, which are not worth the same.
In technology, NFT is to embed an identity information in the intelligent contract, so that each NFT has a unique ID. This unique attribute makes NFT an ideal option for recording and storing ownership of digital products, including art, games and collections.
Based on the features of NFT, this article will organize a full guide tutorial on NFT.
Unlike bitcoin, which offers 21million identical coins, NFT has unique characteristics that make it different. The following three points make them different from the typical cryptocurrency:
Uniqueness: This is the “irreplaceable” part of NFT. NFT is completely unique, and no two NFT are the same;
Rarity: scarcity is an important factor in NFT’s appeal. Although developers are free to produce unlimited amounts of certain assets, they also have the right to limit the number of rare and ideal items that exist;
Indivisibility: in most cases, NFT cannot be split into smaller denominations, they can only purchase, sell and hold them as a whole;
Interoperability and tradability: since many blockchain standards are open, NFT can move across different ecosystems, wallets, markets, etc. As a result, users can use NFT to trade goods outside their original system (e.g., selling video game skin);
1、 NFT use case
Before, digital artists could be in a nightmare because they could not protect their copyright and talented creators might have had a hard time making a living. But with NFT, one can buy creation and proudly show it in virtual space, while blockchain provides ownership. Artists can also gain more from it, even distribute the remaining profits from future sales to create a regular source of income
As we can see in cryptokitties, NFT is used to create a new type of collection – even the possibility of buying a token version of your favorite celebrity or sports star. The tokens also drag traditional collectors’ items (such as baseball cards, coins and stamps) into the 21st century.
Ethereum name service, which provides eth domain names, has turned each of these domains into irreplaceable tokens, so they can be sold, and unstoppable domains can also deal with.Crypto addresses. Other platforms (such as decentraland and cryptovoxes) even allow users to buy virtual land.
Assets in the real world
Work in this area is still in the early stages of development, but it can be demonstrated by marking NFT that someone owns a piece of land, thus marking real-world assets such as real estate.
Each of us has a unique character – from our looks to our education and medical history. NFT can digitize all of these and let us control data better.
2、 Which major brands have joined NFT?
3、 2021 NFT project worthy of focus
Lecube is the new product that chain veteran mikmarvel is about to officially launch. The team once produced many kinds of fire chain tours such as cloud Dou long in 2018, which once exceeded “cryptocat”. Lecube is mainly focused on NFT community creation and new nft+defi play, aiming to change the current NFT pricing immature and consensus rapid loss and other difficulties.
Ethernet chain is one of the most popular NFT platforms at present. Ethernet chain is a digital art market that sells sports cards, collections and digital art through NFT. The goal is to use some of the benefits to help charities and promote social welfare. It also helps artists and other creators auction their works and donate part of their earnings to the charity they choose.
Kiwie is a digital art market that sells street art through NFT. For each street artwork you draw, you will also create digital artwork that matches it and add NFT that contains the physical coordinates. Anyone who buys digital art on this platform also owns the street art. Once street art is repainted or destroyed, digital art will be permanently converted into ghost version.
4、 Ecological blueprint of NFT enabled by IPFs filecoin Technology
As we all know, although the value of NFT is now recognized by more and more people, if the custody is not proper, it is likely that the NFT assets owned are likely to be worthless. For example, you buy a NFT product of video. Although you can query token information in the chain, due to the excessive file memory, transmission efficiency, storage cost and other factors, the platform does not have the chain up center storage, but uses the method of saving asset data under the chain. That is, if the storage platform is overloaded one day, it will bear a large amount of data storage, Then the NFT products you buy are likely to be lost from now on.
Now, filecoin storage can help NFT break through bottlenecks.
Through NFT stored by filecoin, miners must pack and upload blocks to filecoin network for saving, and the whole transaction (save) process can be considered complete. Of course, asset owners can also use the filecoin retrieval function to view assets or transaction assets. Therefore, NFT stored on filecoin is provided with effective security.
The following ecological map published by IPFs community of time-space blockchain introduces the current NFT integration of the technology dynamics and project progress of ipfs&filecoin. From the application of filecoin&ipfs in NFT, we can see that filecoin&ipfs, as the infrastructure of Web3.0, has great potential for application in the future decentralized digital era.
There are several different standards for immutable token. The first is erc-721, which is more common erc-20 token. Erc-721token is driven by intelligent contract code. These codes embed unique details, making it a rare or ideal token. This metadata can be stored on or outside the blockchain.
NFT is not limited to Ethereum – these tokens are supported by other blockchains, including flow blockchains for Tron, EOS, Neo and dapper labs.
6、 NFT industry statistics
In terms of market capitalization, the NFT industry grew 17 percent in 2019 – 50 percent by the end of 2020, and a new outbreak is expected in 2021.
In addition, NFT games were extremely good in 2017, while the number of players in 2018 and 2019 stagnated. By 2020, the user base of the industry will increase by 30%. This year, it is expected that the user group of the industry will double its growth.
7、 What is the next step in NFT?
The emergence of NFT may have a profound impact on industries other than games and digital art.
In content, companies like mirror allow authors to own and sell their works as NFT, opening up new ways to distribute and monetize content. So the idea of decentralized self-government organizations (DAO) is also emerging.
In addition, some companies are expanding their business into deeper financial services, combining defi with NFT. Nftfi allows users to use their NFT as collateral for loans, while nftx has launched the NFT index fund that allows buyers to own a number of NFTs.
At the same time, the combination of NFT and filecoin has gradually matured. Although filecoin technology can only support the storage under the chain of NFT market, in the future, with the implementation of filecoin intelligent contract, NFT can realize the exchange of data and value based on filecoin itself.