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In February 2021, the musician Grimes sold around US$ 6 million worth of tokens representing digital art on Nifty Gateway. Later in February 2021, an NFT representing the meme animation Nyan Cat was sold in an internet marketplace for just under US$ 600,000.
The American digital artist Beeple's work "Everydays: The First 5000 Days" was the first NFT of an artwork to be listed at prominent auction house Christie's and sold for US$ 69 Million on 11 March 2021. NFTs have taken the art market by storm, making the leap from specialist websites to premier auction houses. Here’s Beeple’s opinion on NFTs a day before the auction:
"I actually do think there will be a bubble, to be quite honest. And I think we could be in that bubble right now."
If you have heard about NFTs and want to know
“What the f**** are NFTs?!!!”
Here’s a primer.
In economics jargon, a fungible token is an asset that can be exchanged for the exact same value and can be traded freely. Think the Indian Rupee or even Bitcoin.
A non-fungible object, by contrast, has its own distinct value, like a Picasso painting or a classic car. Cross this with cryptocurrency technology known as the blockchain and you get NFTs.
Non-fungible tokens or NFTs are effectively digital certificates of authenticity that can be attached to digital art or, well, pretty much anything else that comes in a digital form such as audio files, video clips, animated stickers, and even tweets.
Recently, Jack Dorsey (Twitter’s CEO) put up his first tweet for auction for charity purposes. Here’s the tweet:
NFTs confirm an item's ownership by recording the details on a blockchain, making it effectively impossible to lose ownership, unless transferred.
Sure, anyone could screenshot the above tweet from @jack’s social media feed, print it out, and hang it on the wall. Just like one can take a photo of a Van Gogh painting or buy a print from the internet. But that doesn't mean that one owns those original artworks.
“When someone transfers one NFT to someone else, the code, which represents the NFT, also gets transferred to the other person on the blockchain. This makes sure that one can check on the blockchain who owns the NFT. When an NFT is created it is put up on the blockchain and is time-stamped, therefore it makes digital ownership very simple and easy to identify,"
said Nischal Shetty, the CEO of WazirX (we interviewed him back in January 2021).
So What’s Next?
Well, you could make your own NFTs. Here’s how.
You could read up on the environmental impact of NFTs right here.
You could laugh at this ongoing trend right here.
We’ll leave the choice to you.