Introducing NFT

Introduction

Nowadays, there are a lot of talks about NFT‌ tokens. These tokens are a kind of digital asset in the Blockchain space and, like Bitcoin, Ether or Cardano, they are a cryptocurrency. An important difference that makes NFTs fall into a separate category is their “irreplaceability”. These tokens are designed and built to a specific standard so that unique features can be incorporated into their code that make each token different. According to Mr. Hosseini, this feature of NFTs has become very popular in areas such as collectibles, special symbols, works of art, and even computer games. This article introduces NFT tokens by an interview with Mohammad Hosseini.

Mohammad Hosseini is a trader, financial markets analyst and cryptocurrency expert born in 1996 in Tehran. He has provided extensive trainings in areas such as stock exchanges and cryptocurrency. This financial expert has a master’s degree in mechanical engineering. he is a well-known analyst and trader in the field of cryptocurrencies and an experienced lecturer in this field.

Join us to talk more about these attractive tokens and their uses.

What is an NFT‌ token?

Non-Fungible Token (NFT) is a special type of cryptocurrency that, like all of them, uses Blockchain technology. What makes these tokens fall into a separate category is their “non-fungibility” feature. That is, information is written in the code of an NFT‌ that makes each of these tokens different from each other. For this reason, they are called irreplaceable tokens.

Consider this example to better understand the nature of irreplaceable tokens. Suppose you lent your friend’s 0.1 Bitcoin, and now he wants to return it to you. He can pay you 0.1 Bitcoin, or the equivalent of some ether, or any currency whose daily price is equal to the price of 0.1 Bitcoin. These assets are called Fungible, which can be exchanged for equal value. The same is true of cash. That is, the value of two similar banknotes is always the same, and there is no difference between them for trading.

NFT‌ tokens cannot be copied; they are unique and their information is stored on the Blockchain. So, no one can manipulate them. Because NFTs are not interchangeable, they cannot be exchanged like other cryptocurrencies in exchange offices, and certain markets are used to buy and sell them.

Depending on the features of an NFT, it can be used to tokenize real assets, such as a work of art, an old structure, a famous game character, a popular athlete’s shirt, etc.

How are NFT‌ tokens made?

NFTs are written using the ERC-721‌ programming standard. Developers working with the Ethereum network “Solidity” language, mostly design smart contracts with the ERC-20 standard. As you know, the Ethereum network is capable of implementing a variety of coding standards. Thus, in addition to DeFi, NFTs are implemented on this powerful Blockchain. Of course, rival Ethereum projects such as NEO, EOS, and TRON have also entered the NFT field and have set their own standard for making these tokens.

It is interesting to note that there is another standard called ERC-1155 that can reduce the cost of transactions and storage of NFT tokens and collect and manage several different NFTs in one smart contract.

We said that NFTs are a kind of cryptocurrency, and they can also be stored at specific addresses on the Blockchain or sent to another address. Like all cryptocurrencies, the owner of these tokens is the person who has the information and address keys that contain the NFT‌ token. The holder of this token can make any changes to it; For example, an artist can add his “digital signature” to it. This information is stored as “Metadata” in the corresponding token code.

What is the application and importance of NFT tokens?

NFT technology can be considered as a kind of developed branch in the world of cryptocurrencies. The range of applications of this technology is very wide. The real estate market, lending, art, computer games, and even sports clubs in the real world are interested in using NFTs. Their main use is that the properties of a physical asset can be stored in the form of digital information, thus tokenizing the asset, and NFTs are the best platform for doing so.

Of course, storing digital information about physical assets is not a new task, but using NFTs, this information can be stored on the Blockchain, thus ensuring that information is not tampered with. This is what distinguishes the use of irreplaceable tokens.

Another application of NFTs is to eliminate intermediaries and optimize markets. For example, an artist can convert their artwork into an NFT token using one of the token-building platforms. In this way, he can be sure that the token will never be tampered with (because it is stored on the blockchain), and he can sell it at a market price at any price, without having to pay through the intermediaries of this market.

NFTs can be used to identify and manage people’s identifying information. Documents such as passports and other unique information of each person can be placed in an NFT‌ token, and wherever identification information is required, that token can be used instead of all previous documents.

You may be interested to know that multiple ownerships can also be applied to NFT tokens. That is, just as, for example, each share of a house document can be named after a different person, it is possible to write a smart contract for an NFT‌ token in such a way that each part is owned by a different user.

What are the most famous NFT tokens?

Older crypto users first experienced the concept of irreplaceable tokens in 2017 with a Blockbuster game called Cryptokitties. The characters in this game are virtual cats with unique characteristics, and since this game is based on Ethereum, you have to pay ETH‌ to buy these cats. It did not take long for the game to become very popular with users, and some of them even sold for astronomical prices of several hundred thousand dollars. Of course, over time, the emotional atmosphere of this game subsided, but you can still use the Cryptokitties‌ platform.

Today, big companies like NIKE and Louis Vuitton and even the Professional Basketball Association (NBA) offer services based on NFT‌ tokens. NBA Top Shot, Crypto Punks and Street Fighter are some of the most popular tokens in this field. NBA Top Shot is currently the most popular platform in this field, in which video clips of the best basketball throws are traded in the form of irreplaceable tokens. The value of the tokens traded on this platform is close to $ 300 million.

Some NFT token building platforms are active in one area and some in several. For example, the Terra Virtua platform is mostly used to create works of art and Hollywood, and SuperRare‌ works in the field of tokenizing works of art and, as its name implies, focuses on works of art that are extremely rare.

Decentraland‌ is one of the first decentralized games on the Ethereum network and has many fans. The native token of this network is called “MANA”. Users can use this token to buy a variety of goods, services, and even plots of land and perform various stages of the game. The game environment is similar to Minecraft and even supports other NFT tokens such as AXIE Infinity and Cryptokitties.

Concluding remarks

In this article, we introduced NFT tokens and the concepts and applications of these attractive tokens. As mentioned, these tokens have properties that make them irreplaceable and cannot be considered valuable. An NFT token can symbolize a work of art, a particular person, property, game character, or even an athlete’s shirt.

The value of an entity is always determined by its users. So, if an NFT token is exchanged for multimillion-dollar figures, it shows that human beings value such a particular technology. Thank you for accompanying us to the end of this article, and we hope you find this article useful.

Description: NFT tokens are a set of digital currencies that are different from each other and are therefore called irreplaceable tokens. Learn more about NFTs.

Summary: Irreplaceable tokens, or NFTs, are a special class of cryptocurrencies in the Blockchain world that, because of their unique features, cannot be exchanged like Bitcoins and other currencies. NFTs are unique and are used to tokenize collectibles, artwork, real estate, game characters, and more.

References :

https://www.investopedia.com/non-fungible-tokens-nft-5115211

https://decrypt.co/resources/non-fungible-tokens-nfts-explained-guide-learn-blockchain

https://www.businessinsider.fr/us/what-does-nft-mean-crytpo-non-fungible-tokens-art-explained-2021-2