WHAT ARE NFTS AND WHAT IS THEIR RELATIONSHIP WITH THE BLOCKCHAIN?

submitted 2 years ago by ethereumtoken to cryptocurrency

Value is usually conferred on tangible goods that can be touched and seen, such as stamps, works of art or jewelry. However, intangible assets can also be given a value. In this context and, above all, if we talk about collecting and art, there is more and more talk of non-fungible tokens or non-fungible tokens (NFT). We explain in this article what NFTs are and what relationship they have with the blockchain. How we define NFTs From IEBS Business School they explain to us that non-fungible tokens could be defined as a contract in which it is stipulated that a person is the owner of a unique and irreplaceable copy of a digital asset. Thus, to ensure that the contract is safe and true, it is stored in a public network, using blockchain technology. NFTs are not interchangeable because they are unique, even though there may be copies out there. However, an NFT can be sold to another person. As the business school points out, most of these tokens are written on the Ethereum network. What role does the blockchain have Being on the blockchain ensures that it is auditable and that if these buyers decide to sell such a single asset ownership contract, it can be tracked. Precisely, the relevance of NFTs development comes from the fact that their origin can be guaranteed by introducing a code in the programming. In this way, it allows that if the work ends up being sold to another owner, the transaction is recorded on this public network, and the creator or artist will be remunerated with a percentage for each transmission of the same. What is the evolution of NFTs? Although tokens and this crypto art market have a speculative business aspect , as is the case with cryptocurrencies , at the moment there are forecasts that indicate that it will continue the same upward line of growth that it has registered in recent times. According to a study carried out by the firm Invezz, echoed by IEBS Business School, the volume of operations is expected to reach 145 million euros by October. Among the most famous sales of NFTs is that of the American boxer and youtuber Logan Paul. A few months ago he put 3,000 NFTs of Pokemon cards up for sale and in a few days he sold all the assets for 5 million euros. IEBS explains that what is interesting about this action is the value that these cards will have in the future,it is estimated that in 2030 it could increase to 30,000, since in 2021 they cost 2,000. Another well-known case is that of artist Mike Winkelmann, nicknamed Beeple, who sold his NFT “EveryDay - The First 5000 Days” in March for $69 million. Risks of the NFT boom From the business school they warn that the theft of digital works of art has also increased with the rise of NFTs . " Even if there is an original version of the artistic product, it does not prevent multiple copies from being made," they argue. However, "there is only one original, whose ownership is recorded in the blockchain," they add. They exemplify this risk with the theft reported at the end of March by the NFT platform development Nifty Gateway of their complete collections of NFTs. Their accounts were hacked which triggered the theft of digital assets valued at $150,000 and the purchase of others using their credit cards