nft: NFT craze explained: What is it, why is it so popular and how to they work

NEW DELHI Cricketer Yuvraj Singh on Monday launched his Non-fungible token (NFT) collection in partnership with Colexion, a digital collectables website to share some of the best moments of his career with his fans. A hot-air balloon was launched from earth to orbit that carried Yuvraj Singh’s iconic bat, which he used to register his first-ever century in the 2003 ODI match against Bangladesh in Dhaka. People have spent over $9 billion in NFT sales so far—and total sales are expected to hit $17.7 billion by the year’s end, according to a new research by Cointelegraph.
The NFT contains a 3D version of the cricketer along with his signed 1st-century bat to be made available for his fans. Colexion is also creating a one-of-its-kind virtual NFT Museum for all the NFTs of Yuvraj where his fans can be a part of his life’s journey. Yuvraj is one of the many Indian celebrities to cash in on the growing interest in such digital assets.
But why are NFTs so popular?
Non-fungible tokens are unique digital assets, or collectibles, which are created using blockchain. The blockchain, also used by cryptocurrencies such as bitcoin, creates a time stamped permanent, publicly accesible record of decentralised data.
NFTs, also known as nifties, represent real-world objects like art, music, in-game items and videos. They are bought and sold online, mostly with cryptocurrency, and they are generally encoded with the same underlying software as many cryptos.NFTs are usually bought with cryptocurrency Ether or in dollars and the blockchain keeps a record of transactions. While anyone can view the NFTs, the buyer has the status of being the official owner – a kind of digital bragging rights.
What can you do with an NFT?
NFTs allow people to prove ownership ownership of digital assets. Owners can also programme royalties for themselves into the metadata before selling on, to receive a percentage of future sales.
What about copy and paste?
No matter how many times something is copied, the current ownership of the originalfile will always be provable. Like any are, exposure can potentially increase the value of ownership.
What is fungible?
Anything you can swap with exactly the same value, such as money.
What is it non-fungible?
A fungible asset is something with units that can be readily interchanged – like money. For example, swapping a Rs 20 for two Rs 10 notes without losing any value. Non-fungible is an economic term that you could use to describe things like your furniture, a song file, a painting or a house. These things are not interchangeable for other items because they have unique properties. Although a painting can be copied or photographed, the original is still the original, and the replicas don’t have the same value.
So NFTs represent ownership of unique items like art, collectibles, even real estate. They can only have one official owner at a time and they are secured by the Ethereum blockchain – no one can modify the record of ownership or copy/paste a new NFT into existence.
How is it different from cryptocurrency?
Unlike cryptocurrencies, which can be exchanged with one another,NFT is unique and cannot be exchanged with another item. Also this: Bitcoin can be broken down into smaller units but NFTs cannot be broken down and exist as a whole.
How do NFTs Work?
Most NFTs are created and stored on the Ethereum network. NFT ownership can be traced and verified while the owner of the token can continue to remain pseudonymous.
“An NFT can only have one owner at a time. Ownership is managed through the uniqueID and metadata that no other token can replicate. NFTs are minted through smart contracts that assign ownership and manage the transferability of the NFT’s. When someone creates or mints an NFT, they execute code stored in smart contracts that conform to different standards, such as ERC-721. This information is added to the blockchain where the NFT is being managed. The minting process, from a high level, has the following steps that it goes through:Creating a new block, alidating information and recording information into the blockchain,” explains a blog post on etherum.org.
So tokenized artwork comes with a unique digital certificate of ownership which can be sold or bought online. Since it is stored in blockchain, it is transparent and cannot be copied or stolen.
What can NFTs be used on?
Any digital content, such as art, videos, gaming items, Gifs, avatars, music, tweets, domain names.
What is not to like about NFTs?
The large carbon footprint generated by the computing power needed for blockchains.
The current high prices nifties fetch may well be a bubble.
Why own something anyone else can have?
What are the post popular NFTs?
NFTs exist for all kinds of videos, music, text, art even tweets. Art has seen some of the highest sales while in sports, fan con collect and trade NFTs relating to a particular player or team. For example you can buy NFTs in the form of video highlights of moments from games. While these highlights can be seen for free, people are buying the status as the owner of a particular NFT, which is unique due to the digital signature.
On 19 February 2021, an animated Gif of Nyan Cat – a 2011 meme of a flying pop-tart cat – sold for more than $500,000, while Christie’s sale of an NFT by digital artist Beeple for $69 million set a new record for digital art.
In March, an NFT digital artwork called “Everydays: the first 5,000 days”, sold for $69.3 million.
Jack Dorsey, the founder of Twitter, sold the NFT for his first Tweet for $2.9 million
The NFT of the popular ‘Charlie Bit Me’ video of a baby biting his brother’s finger sold for around $761,000 in May
A New York Times columnist sold an NFT-enabled article for $563,000.
What’s happening in India?
In 2021, several Bollywood and sports celebrities launched NFTs.
In September 2021, Amitabh Bachchan become the first Bollywood actor to launch his own NFTs with BeyondLife. club where Bachchan’s Madhushala poem recital sold for $7,56,000 and physical posters of Sholay and other movies that were personally autographed by him were sold for $94,052.
Actor Salman Khan-backed BollyCoin, a Bollywood-based non-fungible token (NFT) platform is launching digital collectibles of the Dabangg franchise on December 30. The collections will include movie clips, posters, and stills.
In July, a Singapore-based NFT marketplace, Diginoor.io inked a pact with movie production company AVM Studios to launch movie collectibles in NFT form the Rajinikanth-starrer ‘Sivaji: The Boss’. Seventeen NFTs of the film were sold out.
In August, NFT platform Rario launched a cricket-based digital collectibles platform with former Indian cricketer Zaheer Khan. Cricketer Rishabh Pant has also signed up with Rario. Pant’s association will allow Rario to mint exclusive digital collectibles of Pant’s iconic moments on and off the field. Cricketer Dinesh Karthik auctioned a digital art reel from a match where he hit a match-winning six on the last ball for around 5 ethereums/
FDCI x Lakme Fashion Week has partnered with WazirX NFT Marketplace for fashion NFTs. In October, designer Manish Malhotra sold NFTs of digital sketches of some of his most famous creations for $4,000 a piece. The other pieces were sold in the range of $2,054 to $2,535 within two minutes after the sale started.
Pop icon Ritviz and visual artist Santanu Hazarika sold their collaboration for $391.80 on WazirX’s NFT marketplace within 10 seconds of going live.
In November, actor Sunny Leone’s NFT collection–were “sold and minted”, NFT platform Mintdropz tweeted.
In November 2021, superstar Kamal Haasan said he was joining the NFT space with his own collections. The actor, through Lotus Media Entertainment, has joined hands with a digital collectibles platform called Fantico to launch his NFT series.
Earlier this month, premium tea company Vahdam India gifted a personalised NFT to Parag Agarwal, the newly-appointed CEO of Twitter. The NFT has been listed on the marketplace platform OpenSea and features Agarwal sipping tea in his office soaking in the momentous day in his life that is now being celebrated by Indians across the globe. “This is a proud moment for all of us here in India. As a CEO of a homegrown Indian brand, Parag’s achievement feels not only thrilling but personal,” Bala Sarda, founder and CEO, Vahdam India.
With inputs from AFP