Explore Non-Fungible Token (NFT) | Technology.
The Article contains a basic understanding of NFT.
NFT, Non-fungible tokens are the current trend. If you are active in the cryptocurrency domain then I am sure you must have at least heard about the same. Even though I am not the owner of any Cryptocurrency, my urge to explore them encouraged me to research them.
So I decided to understand all the pros and cons of this currency before making my mind about investing in them. The intent of the article is to help you explore NFTs and if everything goes well, probably in a couple of days we might have something regarding my first NFT transaction. You never know. Although in no way, I am encouraging anyone to invest in it, understanding the NFT and blockchain world is kind of necessary as it’s the future. So before understanding NFT, we need to understand blockchain. Let's discuss blockchain. Disclaimer my knowledge is ever-growing and I like to keep sharing it with everyone, so consider following(Click here) and subscribing to my newsletter(Click here). Let's get started with Blockchain and then we will continue with NFT.
Blockchain in simple words can be described as a decentralised distribution of power that is handled by various peers instead of a central authority. Unlike any central authority, here there are peers(authorised individuals) who are responsible for making it work.
On contrary, like banks or the financial institutes where the power is in hands of them, they play a critical role in deciding about the policies. But with the help of Blockchain, this entire outlook has changed. So due to issues with the centralisation of power, there was a need for something which is decentralised. Although blockchain is not been fully accepted in the market, soon it will be widely accepted. But various economies are considering it as a possible option. With a central organisation, the power is always in the hand of a particular organisation any policy change made by them can affect hundreds of people. Everyone was yearning for change, they want the end-users to have the power since they are the main stakeholders, not the middle man. In Blockchain, there is distributed ledger which is been distributed to all the peer anybody involved in the network can fetch that leisure and verify any transaction made. With respect to crypto current, any transaction made is permanently marked on the network which can't be deleted. Any new transaction is always verified by the peers managing the blockchain.
Cryptocurrency as the name suggests is the type of currency that is powered by blockchain. To understand cryptocurrency a person should already be aware of blockchain and decentralisation. In the section above we have already read about what is decentralisation and blockchain. So here we will directly jump into cryptocurrency.
So your regular currency is anything that is handled by any government /central organisation and is valid throughout the country. There can be various denominations of the regular currency but the catch is that it is always handled by that centralized organisation. But on the contrary, the currency is decentralised, there is a distributed ledger that is available to anyone on the network, they can fetch the transactions made on the blockchain. This letter is immutable so it can't be tempered. The data is absolutely safe it can't be deleted or updated. There is some set of tokens that can be purchased and sold amongst the peers who are dealing with cryptocurrency. Bitcoin, doggy coin, litecoin etc are some of the famous cryptocurrencies. You need to have a wallet to deal with these currencies you can purchase or sell them. The benefit of cryptocurrency is that it is secure, data is readily available and there is no central organisation that can affect your investments. Also, decentralisation makes it vulnerable as it's the human tendency to trust an organisation more than individual contributors. Somewhere near 2008, Satoshi Nakamoto has introduced Bitcoin to the market, way before it was accepted by leading authorities. Currently, Bitcoin is the leading cryptocurrency, where 1 Bitcoin equals 2975217.77 Indian National Rupee or 38626.40 US dollars. One can have either a hot (Connected to the internet, easy to transact wallet) or a cold wallet(Offline wallet, much safer as chances of theft is minimal unless done any blunder) to transact using bitcoin. Meta mask, Coinbase are some of such wallets which can be used easily. Just a suggestion always research thoroughly or consult an expert before investing any huge amount.
The non-fungible token is commonly abbreviated as an NFT. Fungible means that are replaceable by any other identical things. So obviously non-fundable tokens are something that can't be replaced by any other identical item. The non-fungible tokens are tokens in the blockchain which helps us identify a particular copy of any image, property, or any physical and digital product.
For instance, let's suppose there is a book which you own, there can be thousands of other people who might be having the same book. But the copy of the book which you have is unique in the entire world. It can't be replaced by any other book which is even identical. Since it has some emotions, marking which is specific to you. On similar grounds NFT also has the same concept. Let's suppose an image present over the internet that can be purchased and graved in Blockchain. This means that any particular instance of the image belongs to you. Although that doesn't mean nobody over the internet can download that image. But that particular instance of the image belongs to you, not the entire internet.
Like various famous online wallets, Metamask is one such wallet that helps with making transactions at the NFT marketplace. For the creation of one such wallet on Meta mask.
You can visit the link https://metamask.io and create a free account. Make sure that you are landing upon the correct website. As there are various unwanted elements in society who are always ready to loot your hard-earned money. Various NFT marketplace like Opensea (https://opensea.io/) etc get links with meta mask wallet which contains your cryptocurrency. Using this you can make any transaction on any of the NFT Market Places. There is a gas fee that is charged on any transaction done. The fees depend upon the type of cryptocurrency you are dealing with. Just for your information, Ethereum has significantly high gas rates. But for sake of practically experimenting with it, you can use Polygon as your cryptocurrency. Personally, I am also planning to try Polygon for the first time for making the NFT transaction. So will recommend you research a bit more about polygon.
Like everyone even I sailing the same boat, I am also new to NFT and exploring it in depth. Post my research I will make up my mind about investing in NFT. Even if I invest in NFT this will be purely for my personal understanding. In near future, I don't have any plan to make it a source of my permanent investment. But there is no harm in understanding the process of investing by purchasing NFT. I want to do it practically, to get first-hand knowledge. If anyone of you reading this article have already invested in NFT, I would be more than happy to learn about your experiences. Originally Published on Medium.