You’ve probably heard a lot about non-fungible tokens, or NFTs, recently. Mike Winkelmann, the digital artist who goes by the name Beeple, made headlines earlier this month when he sold an NFT for $69 million.
And it goes beyond art. People are spending millions of dollars on NFT collectibles of all sorts, from sports trading cards and highlight reels to digital houses, augmented reality sneakers and music.
An NFT is a new type of digital asset. Ownership is recorded on a blockchain — a digital ledger similar to the networks that underpin bitcoin and other cryptocurrencies.
Each NFT is unique and can’t be duplicated. So, you can think of them as unique digital items nobody else owns. Sure, people might have an image of a piece of art you purchased as an NFT, for example, but they don’t own the original.
That’s what makes them enticing. And there’s the prospect that because they can be rare, you might be able to sell one later for more money. Just like you would with fine art.
You can use various currencies to buy NFTs. NBA Top Shot, for example, lets you buy them with a credit card. But other platforms require you to buy using some form of cryptocurrency.
How to create NFTs
Creating your own NFT artwork, whether it be a GIF or an image, is a relatively straightforward process and doesn’t require extensive knowledge of the crypto industry. NFT artwork can also be used to create collectibles like sets of digital cards.
Before you start, you will need to decide on which blockchain you want to issue your NFTs. Ethereum is currently the leading blockchain service for NFT issuance. However, there is a range of other blockchains that are becoming increasingly popular, including:
Binance Smart Chain
Flow by Dapper Labs
Tron
EOS
Polkadot
Tezos
Cosmos
WAX
Each blockchain has its own separate NFT token standard, compatible wallet services and marketplaces. For instance, if you create NFTs on top of the Binance Smart Chain, you will only be able to sell them on platforms that support Binance Smart Chain assets.
This means you wouldn’t be able to sell them on something like VIV3 – a Flow blockchain-based marketplace – or OpenSea which is an Ethereum-based NFT marketplace.
Since Ethereum has the largest NFT ecosystem, here’s what you’ll need to mint your own NFT artwork, music or video on the Ethereum blockchain:
An Ethereum wallet that supports ERC-721 (the Ethereum-based NFT token standard), such as MetaMask, Trust Wallet or Coinbase Wallet.
Around $50-$100 in ether (ETH). If you are using Coinbase’s wallet you can buy ether from the platform with U.S. dollars, British pound sterling and other fiat currencies. Otherwise, you will need to purchase ether from a cryptocurrency exchange. A guide on how to buy cryptocurrencies using the most popular exchanges can be found here.
Once you have these, there are a number of NFT-centric platforms that allow you to connect your wallet and upload your chosen image or file that you want to turn into an NFT.
The main Ethereum NFT marketplaces include:
OpenSea
Rarible
Mintable
Makersplace also allows you to create your own NFTs but you have to register to become a listed artist on the platform beforehand.
What are some examples of NFT's?
Examples of popular NFTs include:
Topps “Garbage Pail Kids” trading cards, an iconic cult-classic collectible since the 1980’s reimagined as NFTs
William Shatner, the legendary actor whose roles include Captain Kirk in Star Trek, who released personal memorabilia to the public as trading cards
Blockchain Heroes, an original trading card series featuring the likenesses of personalities in the crypto and blockchain space
Prospectors, a popular blockchain-based game where players earn NFTs based on their gameplay which help improve their in-game performance
CryptoKitties, the “OG” popular NFT series that skyrocketed NFTs to popularity back in 2016 and even though they quickly fizzled out, they are one of the most recognizable names in the NFT world since they were the first to be successful.
The Future of NFTs
Right now most NFTs are used to sell digital art and collectibles. This may be a fad or it could be the new form of exchanging collectible assets ranging from trading cards to artwork.
In the future, NFTs can be used to tokenize any real world asset, making ownership of assets transparent and incorruptible. Non-fungible tokens could be extremely valuable for real estate deeds, vehicle titles and business ownership.