What Is a Non-Fungible Token (NFT) Marketplace?
What is a Non Fungible Tokens Marketplace? Read an article to find out everything you need to know about NFTs!
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The last few years have seen an increase in NFTs. Today, tokens could be sold online for millions of dollars. Investors are turning to NFTs because it is a lucrative way of making serious cash.
As more people are moving towards acquiring these digital assets the value of the NFTs market surpassed $338 million in 2020. A good example of the impact of nonfungible tokens is when Twitter founder, Jack Dorsey, sold the very first tweet for over a million dollars.
So why the sudden increase in interest in NFTs and what exactly is an NFTs. Let’s find out everything you need to know about NFTs marketplace!
For All Those Who Are Still a Bit Confused with What “NFT” Is
Non Fungible Token commonly known as NFTs is a certified digital asset on a blockchain. Unlike other digital assets, it is not interchangeable. NFTs can represent any type of assets from sports memorabilia, videos, pictures, and digital art pieces. They are similar to physical items in so many ways, for example, imagine a limited version of a sports item. Only a few people would have that item. The same applies to NFTs. The only difference is that it is unique and a digital item belongs to only one person.
Special numbers are given to each NFT, thus separating one from another. While a nonfungible token is not interchangeable, it doesn't necessarily mean that other people won't have access. The essence of NFTs is to provide owners with proof of ownership that can be traced to a blockchain.
Where Does One Come From?
The first known NFT, ColoredCoins, was implemented on Bitcoin. Just like the NFTs today, ColoredCoins was designed to certify ownership of digital assets. Unfortunately, bitcoin couldn't sustain ColoredCoins. Because the bitcoin blockchain wasn't meant to support the NFTs, the project was canceled. By that time, investors had already started realizing the importance of certifying digital assets, meanwhile:
- Bitcoin launched another platform, Counterparty, in 2014, which was designed to create tokens. The first real NFT was quantum. This was a video of spinning dollar signs. Till 2016 there was not much change in dealing with NFTs.
- But 2017 was a major game-changer as Ethereum took center stage. Unlike bitcoin, Ethereum was designed to support tokens. It was Ethereum that came up with the term Non Fungible Tokens. With Ethereum, there were several NFTs released including CyberPunks and CryptoKitties.
- In 2019, Nike was able to create CryptoKicks, a system that would rely on NFTs to ensure the authenticity of sneakers. So customers could buy a virtual pair of physical sneakers. Dapper Labs, the studio that created CryptoKitties launched TopShot in 2020 which has made over 200 million dollars.
What’s interesting, more people have shown interest in NFTs in 2021. Popular people such as Grimes and Jack Dorsey started making millions from digital art. Investors are trading big as there is a growing frenzy around NFTs. Today, users can collect NFTs or simply buy them from marketplaces. Some platforms offer users the opportunity to win NFTs by signing up.
How an Existing Tech Works
Several blockchains support NFTs, each working differently. Among the most popular blockchains is Ethereum. With blockchains, the main goal is to provide an authentic digital product that is unique. It is a one-of-a-kind asset with no other copies. Even though Ethereum is the leading blockchain many others are capable of implementing their own NFTs.
Non Fungible Tokens can be anything from games to digital items. Even tickets from a concert can be used as NFTs. Once you get one, it is like a contract, stating that the particular item or collectible belongs to you. Through the blockchain, you can prove your ownership of the item.
The Non Fungible Token marketplace is booming. Basically, the Marketplace is an online platform where users/artists can buy or sell non-fungible art pieces and earn cryptocurrency, e.g. BitCoin.
Most of the marketplaces also charge a transaction fee, and require an account with them (usually a free one)So many marketplaces exist that offer users the opportunity to acquire NFTs. So users can go through several items and pick one that they want to buy. Typically, NFTs are limited. For instance, CryptoPunks only has a few characters and users can collect these characters at a certain amount. Each character is unique and thus the owner will be the only one with that collectible. So whoever owns any of the characters will be officially given a special number showing proof of ownership on Ethereum.
Originally, NFTs could be purchased directly from the blockchain. That has changed over the last few years. Now, users can sell and buy NFTs through a marketplace. When someone puts NFTs up for sale, people can place bids until the highest bidder wins.
NFTs serve two main purposes:
- The first is just the pleasure of collecting different items. Owning one of a kind item is simply exciting.
- The second purpose is financial gain. Investors buy NFTs and can later sell them at double or triple the amount that they bought the item at. The value of NFTs only keeps rising, making them a good investment.
So one can earn millions simply by buying and selling NFTs. Also, the price of the blockchain doesn't necessarily affect that of NFTs. For example, while the price of Ethereum didn't change by much, that of CryptoPunks increased by three times its original value.
Another NFT that has been making waves is TopShot. Since its launch, TopShot has made millions of dollars selling video clips. The NFT marketplace attracts sports players and fans. Within a really short period, this NFT has generated more value as compared to others. Even actors and influencers are investing in TopShot.
Below we provided the list of famous marketplaces. It is better to make an own research according to your needs, however, we recommend see the below platforms where you can find artists and buy new art:
6. Myth Market
9. Enjin Marketplace
It comes as no surprise that the value of NFTs keeps increasing. The increase extends to the point that these digital assets are surpassing the value of physical products. People are simply willing to spend any amount of money on a unique digital asset.
Some studios offer users the opportunity to buy virtual land. Users can buy a piece of land in virtual worlds such as DecentraLand and The SandBox. Because of the popularity of virtual lands, each piece of land is awarded a unique nonfungible token. So one knows exactly which land is taken. The location and scenery of each piece of land is the distinguishing factor.
DecentraLand was able to raise millions of dollars in less than an hour. Most of the buyers were gamers who could own land and build anything of their choice. Today, the demand for virtual land is very high. The virtual world has gotten larger with many new places such as galleries and fashion stores being opened. The owners of fashion stores within a virtual work can sell their items. Users can buy different items like art pieces or decorations for their virtual homes.
How to Acquire an NFT?
Think of what it feels like to have a picture of your favorite musician autographed. The idea behind NFTs is the same as autographed photos or sports memorabilia. Each gift is given a unique identity that can be traced on a blockchain. The use of NFTs extends to:
So Non-Fungible Tokens can be used for almost any type of virtual asset. Sports brands like Nike have attached digital assets to physical sportswear. Many sports players are also investing in tokens. The NBA through TopShot was able to use NFTs to sell selected video clips. While the sports industry is one of the leaders in NFTs, the same cannot be said for the film industry.
One of the biggest challenges that the film industry faces in using Non-Fungible Tokens is the immense difficulty of storing data. Because digital files are larger files, storing them on a blockchain is a challenge. Blockchains are typically designed to handle smaller files. Despite this challenge, the film is gradually making its way into the world of NFTs. In 2021, the first film, Claude Lanzmann: Spectres of the Shoah was sold as a nonfungible token.
Artists who create digital work are fully taking advantage of NFTs. Artists can sell their work on marketplaces. Other platforms such as Pixabay give artists a chance to create different art pieces without getting paid. It is purely for attribution. Virtual Lands have so many artists currently. That is because they offer artists the chance to sell their pieces for millions of dollars. Through galleries, people looking for NFT art and those creating it have found a better way of interacting with each other.
Non-Fungible Tokens are taking the world by storm. More people are willing to spend money on digital assets. These certified and unique assets are verified on the blockchain. NFTs come in the form of different items including audios, videos, fashion, and concert or sports tickets. The number of marketplaces offering NFTs has been increasing. Users can buy unique characters or simply buy land within a virtual world.
While NFTs are supported on the blockchain, the value is independent. Sometimes, the blockchain may remain constant while that of NFTs will only increase. The future of Non-Fungible Tokens seems promising. With so many people looking to not only buy but spend huge amounts of money on digital assets, this industry will only keep growing.