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What Is An NFT? Non-Fungible Tokens Explained


What Is An NFT?

Non-fungible tokens (NFTs) seem to be everywhere these days. From art and music to tacos and toilet paper, these digital assets are selling like 17th-century exotic Dutch tulips—some for millions of dollars.

But are NFTs worth the money—or the hype? Some experts say they’re a bubble poised to pop, like the dot-com craze or Beanie Babies. Others believe NFTs are here to stay, and that they will change investing forever.

What Is an NFT?

An NFT is a digital asset that can come in the form of art, music, in-game items, videos, and more. They are bought and sold online, frequently with cryptocurrency, and they are generally encoded with the same underlying software as many cryptos.

Although they’ve been around since 2014, NFTs are gaining notoriety now because they are becoming an increasingly popular way to buy and sell digital artwork. The market for NFTs was worth a staggering $41 billion in 2021 alone, an amount that is approaching the total value of the entire global fine art market.

NFTs are also generally one of a kind, or at least one of a very limited run, and have unique identifying codes. “Essentially, NFTs create digital scarcity,” says Arry Yu, chair of the Washington Technology Industry Association Cascadia Blockchain Council and managing director of Yellow Umbrella Ventures.

This stands in stark contrast to most digital creations, which are almost always infinite in supply. Hypothetically, cutting off the supply should raise the value of a given asset, assuming it’s in demand.

Binance,What Is An NFT?

But many NFTs, at least in these early days, have been digital creations that already exist in some form elsewhere, like iconic video clips from NBA games or securitized versions of digital art that’s already floating around on Instagram.

Famous digital artist Mike Winklemann, better known as “Beeple,” crafted a composite of 5,000 daily drawings to create perhaps the most famous NFT of 2021, “EVERYDAYS: The First 5000 Days,” which sold at Christie’s for a record-breaking $69.3 million.

Anyone can view the individual images—or even the entire collage of images online for free. So why are people willing to spend millions on something they could easily screenshot or download?

Because an NFT allows the buyer to own the original item. Not only that, it contains built-in authentication, which serves as proof of ownership. Collectors value those “digital bragging rights” almost more than the item itself.

How Is an NFT Different from Cryptocurrency?

NFT stands for non-fungible token. It’s generally built using the same kind of programming as cryptocurrency, like Bitcoin or Ethereum, but that’s where the similarity ends.

Physical money and cryptocurrencies are “fungible,” meaning they can be traded or exchanged for one another. They’re also equal in value—one dollar is always worth another dollar; one Bitcoin is always equal to another Bitcoin. Crypto’s fungibility makes it a trusted means of conducting transactions on the blockchain.

NFTs are different. Each has a digital signature that makes it impossible for NFTs to be exchanged for or equal to one another (hence, non-fungible). One NBA Top Shot clip, for example, is not equal to EVERYDAYS simply because they’re both NFTs. (One NBA Top Shot clip isn’t even necessarily equal to another NBA Top Shot clip, for that matter.)

How Does an NFT Work?

NFTs exist on a blockchain, which is a distributed public ledger that records transactions. You’re probably most familiar with blockchain as the underlying process that makes cryptocurrencies possible.

Specifically, NFTs are typically held on the Ethereum blockchain, although other blockchains support them as well.

An NFT is created, or “minted” from digital objects that represent both tangible and intangible items, including:

  • Grafic art
  • GIFs
  • Videos and sports highlights
  • Collectibles
  • Virtual avatars and video game skins
  • Designer sneakers
  • Music

Even tweets count. Twitter co-founder Jack Dorsey sold his first ever tweet as an NFT for more than $2.9 million.

Essentially, NFTs are like physical collector’s items, only digital. So instead of getting an actual oil painting to hang on the wall, the buyer gets a digital file instead.

They also get exclusive ownership rights. NFTs can have only one owner at a time, and their use of blockchain technology makes it easy to verify ownership and transfer tokens between owners. The creator can also store specific information in an NFT’s metadata. For instance, artists can sign their artwork by including their signature in the file.

What Are NFTs Used For?

Blockchain technology and NFTs afford artists and content creators a unique opportunity to monetize their wares. For example, artists no longer have to rely on galleries or auction houses to sell their art. Instead, the artist can sell it directly to the consumer as an NFT, which also lets them keep more of the profits. In addition, artists can program in royalties so they’ll receive a percentage of sales whenever their art is sold to a new owner. This is an attractive feature as artists generally do not receive future proceeds after their art is first sold.

Art isn’t the only way to make money with NFTs. Brands like Charmin and Taco Bell have auctioned off themed NFT art to raise funds for charity. Charmin dubbed its offering “NFTP” (non-fungible toilet paper), and Taco Bell’s NFT art sold out in minutes, with the highest bids coming in at 1.5 wrapped ether (WETH)—equal to $3,723.83 at time of writing.

Nyan Cat, a 2011-era GIF of a cat with a pop-tart body, sold for nearly $600,000 in February. And NBA Top Shot generated more than $500 million in sales as of late March. A single LeBron James highlight NFT fetched more than $200,000.

Even celebrities like Snoop Dogg and Lindsay Lohan are jumping on the NFT bandwagon, releasing unique memories, artwork and moments as securitized NFTs.

How to Buy NFTs

If you’re keen to start your own NFT collection, you’ll need to acquire some key items:

First, you’ll need to get a digital wallet that allows you to store NFTs and cryptocurrencies. You’ll likely need to purchase some cryptocurrency, like Ether, depending on what currencies your NFT provider accepts. You can buy crypto using a credit card on platforms like Coinbase, Kraken, eToro and even PayPal and Robinhood now. You’ll then be able to move it from the exchange to your wallet of choice.

You’ll want to keep fees in mind as you research options. Most exchanges charge at least a percentage of your transaction when you buy crypto.

Popular NFT Marketplaces

Once you’ve got your wallet set up and funded, there’s no shortage of NFT sites to shop. Currently, the largest NFT marketplaces are:

•  OpenSea.io: This peer-to-peer platform bills itself a purveyor of “rare digital items and collectibles.” To get started, all you need to do is create an account to browse NFT collections. You can also sort pieces by sales volume to discover new artists.

•  Rarible: Similar to OpenSea, Rarible is a democratic, open marketplace that allows artists and creators to issue and sell NFTs. RARI tokens issued on the platform enable holders to weigh in on features like fees and community rules.

•  Foundation: Here, artists must receive “upvotes” or an invitation from fellow creators to post their art. The community’s exclusivity and cost of entry—artists must also purchase “gas” to mint NFTs—means it may boast higher-caliber artwork. For instance, Nyan Cat creator Chris Torres sold the NFT on the Foundation platform. It may also mean higher prices — not necessarily a bad thing for artists and collectors seeking to capitalize, assuming the demand for NFTs remains at current levels, or even increases over time.

Although these platforms and others are host to thousands of NFT creators and collectors, be sure you do your research carefully before buying. Some artists have fallen victim to impersonators who have listed and sold their work without their permission.

In addition, the verification processes for creators and NFT listings aren’t consistent across platforms — some are more stringent than others. OpenSea and Rarible, for example, do not require owner verification for NFT listings. Buyer protections appear to be sparse at best, so when shopping for NFTs, it may be best to keep the old adage “caveat emptor” (let the buyer beware) in mind.

Should You Buy NFTs?

Just because you can buy NFTs, does that mean you should? It depends, Yu says.

“NFTs are risky because their future is uncertain, and we don’t yet have a lot of history to judge their performance,” she notes. “Since NFTs are so new, it may be worth investing small amounts to try it out for now.”

In other words, investing in NFTs is a largely personal decision. If you have money to spare, it may be worth considering, especially if a piece holds meaning for you.

But keep in mind, an NFT’s value is based entirely on what someone else is willing to pay for it. Therefore, demand will drive the price rather than fundamental, technical or economic indicators, which typically influence stock prices and at least generally form the basis for investor demand.

All this means, an NFT may resale for less than you paid for it. Or you may not be able to resell it at all if no one wants it.

NFTs are also subject to capital gains taxes—just like when you sell stocks at a profit. Since they’re considered collectibles, however, they may not receive the preferential long-term capital gains rates stocks do and may even be taxed at a higher collectibles tax rate, though the IRS has not yet ruled what NFTs are considered for tax purposes. Bear in mind, the cryptocurrencies used to purchase the NFT may also be taxed if they’ve increased in value since you bought them, meaning you may want to check in with a tax professional when considering adding NFTs to your portfolio.

That said, approach NFTs just like you would any investment: Do your research, understand the risks—including that you might lose all of your investing dollars—and if you decide to take the plunge, proceed with a healthy dose of caution.

Crypto Staking Basics


Crypto Staking Basics

With cryptocurrency, one way to make a profit is to sell your investment when the market price increases.

There are other ways to make money in crypto, like staking. With staking, you can put your digital assets to work and earn passive income without selling them.

In some ways, staking is similar to depositing cash in a high-yield savings account. Banks lend out your deposits, and you earn interest on your account balance.

In theory, staking isn’t too different from the bank deposit model, but the analogy only goes so far. Here’s what you need to know about crypto staking.

How To Start A Travel Blog (2023 Guide)

Starting a Travel blog

If you’re passionate about traveling and want to share your experiences with the world, perhaps a travel blog is for you. But how do you start a travel blog? How do you make it stand out? We’ve put together a list of the basic considerations and the initial setup steps you should take to start your travel blogging adventure.

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Hobbies to boost your productivity 🏄🏻‍♀️


Boost your productivity 

Do you spend the time that you’d like dedicated to your hobbies? Most likely, the answer will be no… They’re often one of the first things we throw out the window when life gets busy, but they shouldn’t be. We need to prioritize our hobbies just as much as we prioritize work, because hobbies — they increase our productivity and make us better people.

Let’s dive into some hobbies that might boost your health and productivity…

Let’s dive into some hobbies that might boost your health and productivity…

Boost your productivity 

1. Hiking 🥾

Love outdoors and being active? hiking is an amazing vehicle to reconnect with yourself while you disconnect from work and social network. Research shows that when you go hiking your creativity and problem-solving abilities will most likely increase.

Where to go… (of course, every place has good WiFi for remote work)

  • Brasov, Romania – Being surrounded by mountains, Brașov gives the chance to outdoor lovers to enjoy wild trails in just minutes, starting from the city center and heading towards high alpine peaks. The easiest hike you can do is to climb the Tâmpa Mountain in order to admire a breathtaking view over the old city.
  • Boulder, United States – Boulder has a special charm for hikers, especially during late spring and summer when the astonishing mighty mountains are covered with an outfit of colorful wildflowers. Amongst the trees you can still breath in the fresh cool air even when the temperature in other parts of the country has risen too hot.
  • Vancouver, Canada – Vancouver checks all of the boxes for nomads looking for day hikes where the city serves as a starting point. For a host of epic hikes in the Pacific Northwest, and thanks to a thriving food scene, it’s the perfect city to recharge after a full day on the trail.
Boost your productivity 

2. Surfing 🏄

Patience, bravery and cognitive sharpness are just a few benefits that surfing brings. Not only when you are waiting for the right wave to ride, it also reflects in other aspects of life. Surfing teaches us to enjoy the process and not only the final result, doing things with passion and taking the bull by the horns.

Where to go… (of course, every place has good WiFi for remote work)

  • Canary Islands, Spain – The autumn, winter and springtime bring powerful waves giving the islands their nickname of “The Hawaii of Europe”. The summertime means smaller, less consistent waves, stronger winds and very warm weather.
  • Canggu, Bali – Canggu is a famous beach town on the south-west coast of the island, just north of the busy resort area of Seminyak. Over recent years it has transformed into a hipster hub, and currently, Canggu is one of the most popular places for surfing in Bali.
    With its accessible waves suitable for beginners as well as pros, the surf can definitely get a bit crowded, but that only goes to show what a great place it is.
  • Santa Teresa, Costa Rica – Santa Teresa is located on the southern tip of the Nicoya Peninsula, Santa Teresa is one of Costa Rica’s most beautiful surf towns. The town’s long stretches of sandy beaches and lush jungle make it a popular spot for both surfers and travelers alike. And with its year-round warm water and consistent waves, it’s no wonder that Santa Teresa is often referred to as the “surf capital” of Costa Rica.
Boost your productivity 

3. Running 🎽

Working through discomfort is one of the main learnings that running has. Additionally the positive impact that running has on your mind and body can’t be denied. So if you’re looking for an accessible, affordable, and comparably easy hobby, running may be your thing, mostly when traveling, with just the right outfit you are ready to go!

Where to go… (of course, every place has good WiFi for remote work)

  • Lisbon, Portugal – The city’s geography, weather, and history make it a great city for running. There’s a terrific 5-mile path along the Tagus (Tejo) River, going by important museums and landmarks. For hills, run the narrow streets and lanes of the Bairro Alto or Alfama neighborhoods, up to the Castle or one of the Miradouros (view points). Lisbon’s largest park, Monsanto which is now well connected to downtown via a recently completed ‘green corridor’.
  • Cape Town. South Africa – The city is famous for its harbor, natural setting in the Cape Floristic Region, beautiful landmarks such as Table Mountain, and superb beaches. Routes along Camps Bay, the Sea Point Promenade, and Lion’s Head are a great way to experience Cape Town’s unique geography.
  • San Francisco, United States – One of the world’s most beautiful cities, San Francisco has it all for runners: views, ocean, hills, paths, trails, good weather, variety, and accessibility. The highlight of San Francisco running is the trail from the Embarcadero, over Fort Mason, along with Crissy Field, and toward the Golden Gate Bridge. And for those who like hills, well…
  • Blogbysammy

13 Profitable E-Commerce Business Ideas For 2023


13 Profitable ECommerce Business – To evaluate inclusions for this list of profitable e-commerce business ideas for 2023, we looked for ones that tap into consumers’ passions and meet unique needs and, so, help our readers enter profitable markets. The e-commerce business ideas that met this criterion include handmade pet treats, toys, thrifted goods, dessert boxes, home decor and cosmetics in addition to educational platforms, eco-friendly baby products, specialty foods, plants, resold fashion and ideology-based products.

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