If you spend any amount of time browsing the internet then you’ve probably heard about NFT’s by now. Traders and celebrities spending millions of pounds on a digital image. That’s what it seems like from the outside anyway. But it actually goes a lot deeper than that and can be quite confusing. Why would someone spend money for a house on a clip art of a cat? An explosion of blockchain news like this gets a lot of people interested but some may find it a bit complicated. Well we hope to shed some light on what an NFT actually is as simply as possible.
What is an NFT?
Let’s start with the basics. What does NFT stand for? NFT stands for Non-fungible token. Non-fungible means that it has a unique digital identifier that cannot be copied, substituted or subdivided. This unique identifier is recorded in a blockchain and that is used to certify authenticity and ownership of the token. These NFT’s can be pretty much anything. Drawings, clip arts, GIF’s and even more obscure things such as a Twitter post. That’s right, the founder of Twitter actually sold one of their Tweet’s for just under 3 million dollars. It’s similar to collecting pieces of art but the art you are collecting is digital.
Where NFT’s get a bit awkward is that the piece of art you have just paid all this money for is easily downloaded or saved by other people around the world. The difference is that the file they have copied will not have all the blockchain information attached to it. To put in an example, anyone can buy a print of The Mona Lisa but only one person can own the original. Another thing to note is that when buying one of these pieces, you don’t have to buy it outright yourself. In fact, many people pitch in together and purchase a small piece of it each.
Most of the high level NFT’s are part of the Ethereum blockchain which is a cryptocurrency like Bitcoin and Dogecoin. But Ethereum’s blockchain can also support NFT’s.
Should I Buy An NFT London?
With NFT’s being a very new craze, the market is very erratic and no one truly knows where they will go in the future. We actually read an article which said ‘are NFT’s already over?’. So we would never encourage someone to purchase an NFT because it could go very badly. Many people have already bought into the trend, only to lose thousands of pounds. But there have also been many successes in the market. Pak’s The Merge is an NFT which sold for 91.8 million dollars at the end of 2021. It had almost 30,000 collectors all pitching in together to buy it. That’s almost 100 million dollars for a digital piece of digital art.
We’re still very sceptical but at the same time, very excited to see where these go. If you’re an artist then now might be the time to get designing and creating your own NFT’s to sell. You never know where it could take you.
What is the purpose of buying an NFT London? Obviously buying an NFT lets you support the artist who created it but other than that, what does it get you? Of course you have usage rights where you can use the image online or as a profile picture etc. But other than the bragging rights that you own it along with the blockchain entry to back it up, is there anything else? This is why we directly relate it to collecting art. You own it, you can look at it but that’s about it. As a trader, you can sit on it and hope that it goes up in value and then eventually sell it for a profit.
What Do You Think About NFT’s?
What do you think about NFT’s? Do you think they will last or is it just a trend? Feel free to drop us an email with your thoughts.
Check out the Things To Do In London Homepage for more