NFTs can be used to trace an object’s digital origin, allowing a limited number of people to verify ownership. In a broader sense, it’s a method of artificially creating scarcity so that you can sell something for a greater price because of its scarcity.
In other words you create something and sell it from a value generation perspective. Whoever can do this in the best manner, gets the best $$$$.
American artist Michael Joseph Winkelmann aka Beeple took the NFT world by storm.
On May 1, 2007, Winkelmann began “Everydays,” a project in which he created a piece of art every day. This project is still going strong, with more than 5,000 days of digital art creation under its belt. Winkelmann has spoken about finishing a piece of art even on inconvenient days. He even created art on his wedding day and on birthdays of his children.
On February 25, Christie’s auctioned Everydays: the First 5000 Days, a collage of photos from the “Everydays” collection, which sold for over $69 million on March 11, 2021. Everydays is the first NFT to be sold by a legacy auction house. The payment was made using Ether.
Beeple’s work is now the third-most valuable artwork ever sold by a living artist, behind works by Jeff Koons and David Hockney, as disclosed by Christie’s.
In India, Bollywood legend Amitabh Bachchan, is also slated to make his debut. He’ll be auctioning a collection that includes his father’s poem Madhushala, which has been recorded in the actor’s own voice, as well as other notable items from the actor’s film performances, such as classic attire and vintage hand-painted posters signed by the actor.
Simplifying Further :
So NFTs are certificates of ownership of antiques stored in blockchain technology. Non- fungible means you cannot exchange one piece of art with another, you can only own it.
NFT promotes peer-to-peer transactions by removing middlemen and delays in transactions through financial institutions.
As blockchain is a decentralized technology, when you own something, the information of ownership is shown to everyone. This major issue is solved within a fraction of time which generally takes days.
Think about NFTs as a mechanism to decouple property rights. Having legal ownership to a traditional asset usually comes with a set of standard benefits. In context of owing a house, automobile, or company stock, your title gives proof of ownership, the right to exclusive use, the power to charge for others’ usage, and the right to receive the revenues of a sale.
How does it work?
Suppose somebody wants to sell his painting as an NFT. In the digital network, he should register it as an NFT, and instantly a token is minted and stored in the blockchain ledger. Instead of the actual art, its attributes such as the unique fingerprint, token name, token symbol, and links to file are stored. It is important to not forget that blockchain uses smart contracts to store information, so nobody can tamper with it. Once your artwork is sold, this token is passed to the buyer, giving him the certification as the owner of the artwork.
So you sell your artwork’s ownership rights with a secured technology and earn money for your work. But here’s the trick, the buyer does not get the actual artwork in its physical form, he only gets the option to download a print of the artwork.
The buyer owns the ownership of the original artwork but other things such as copyright and reproduction rights are with the creator.
This is the advantage of trading in the blockchain network with NFT. In the real world, oftentimes the reproduction and copyrights are stolen away with the ownership rights from the creators without any recognition. NFT’s are changing that. By storing original creators’ identities via the decentralized platform, blockchain is maintaining the authenticity of the former and giving them the credit they are due.
What can be sold as an NFT?
Selling of “Everydays: the First 5000 Days” for a total of $69.3 million was a surprise. It is still regarded as the biggest NFT purchase in the blockchain world.
Again, in another scenario, the founder of Twitter, Jack Dorsey sold his first tweet as an NFT for $2.9 million. So, besides artwork, you can sell concert tickets, domain names, real estate, or basically anything that requires proof of ownership.
To keep your money and transactions, first you create a digital wallet. The majority of wallets will immediately generate an Ethereum account for you, which will store your data. The wallet facilitates access to your information.
NFTs are tied to cryptocurrency and their success depends on how well Ethereum and other currencies stay afloat. Stay ahead in the game with market trends before you decide if you want to invest in NFTs or not. But that should not hold you back from having fun since most NFTs can be purchased at an extremely low price.