The most important thing you would need to understand in terms of the significance and use cases of NFT is an explanation of NFT. 

Non-fungible tokens are basically digital assets that feature identifying information documented in smart contracts. The varying NFT use cases evolving in the present times provide clear motivation for learning about them. 

NFT or non-fungible tokens are presently the hottest trends in the domain of blockchain and crypto codes. If you dive deeper into the technicalities of enterprise NFT, you will discover that they are basically unique digital codes.

The unique digital codes depend on the same blockchain technology as cryptocurrencies, such as Ethereum.
On the other hand, NFT are unique and give you the privilege of ownership over digital assets. The existence of NFTs on a blockchain is formidable proof of the NFT blockchain interplay.

You should also note that you can buy and sell NFT by using cryptocurrency. Interestingly, you don’t necessarily need a physical asset in the real world associated with the NFT. 

On the other hand, NFT types also include representation of physical assets such as artwork, real estate, and even your pet dog.

Properties of NFT

In simple words, NFT are digital tokens on a blockchain network and provide a representation of a unique item. You can find a clear explanation of NFT by taking a look at their important NFT attributes in the following discussion.

Uniqueness

The foremost trait on which non fungible tokens rely is uniqueness. The information in the code of NFTs illustrates the properties of the tokens in detail, thereby differentiating them from others. For example, a digital art item could have information about individual pixels in the code of its NFT.

Traceability

The on-chain documentation of transactions for an NFT includes all details of the NFTs. You can easily trace the history of NFT from the time of their creation till the present time.

It is also possible to identify the different times when the non-fungible token changed hands. Therefore, you can easily verify the authenticity of NFTs with the traceability trait.

Indivisible

Another important highlight you will notice in the NFT marketplace would refer to indivisibility. You could not purchase half of the artwork, and the same applies to NFTs.

You cannot transact with NFTs as fractions of a complete NFT as it is impossible to divide NFTs into smaller denominations.

Rarity

Non fungible tokens also feature scarcity that can improve their attractiveness for buyers. As a result, the assets would be highly desirable alongside ensuring that the supply does not surpass the demand.

Programmability

The most crucial trait of NFTs that will drive many other NFT use cases in the future is programmability. NFTs feature-complete programmability is similar to traditional digital assets and tokens on smart contract blockchains.

Users can add features in their NFTs according to their preferences. After all, NFTs are basically pieces of code, and you can add anything to the code. These advantages of NFT makes this technology even more lucrative.

Applications of NFT

The most significant aspect in any discussion about non fungible tokens would be the potential of NFT. 

Many people ward off NFT as a technological fad for the rich people who can invest thousands of dollars in purchasing NFTs and trading them. 

However, NFT is more than just Cryptopunks and the NFT of Jack Dorsey’s first tweet. Let us take a look at some of the potential future applications of NFT.

Digital Identity

NFT can serve a vital role in changing how you visit museums, galleries, and landmarks. You can think of ways in which NFTs can be used to verify the authenticity of guests at such events and places.

In addition, such NFT use cases would also present favorable benefits for attendees. For example, they could receive exclusive benefits and better access to drops.

Marketing

NFT could also find promising use cases in the domain of marketing. Taco Bell has been one of the frontrunners in using non fungible tokens for marketing purposes.

It listed the Live Mas taco-themed NFTs on the renowned NFT marketplace, Rarible. Interestingly, the set of 25 NFT sold out within 30 minutes. Taco Bell allocated a specific reward for the original owners of the NFTs with an exclusive $500 digital gift card.

Real Estate

While virtual real estate has been gaining a lot of attention in recent times, the potential NFT use cases for physical real estate also appear endless.

Using NFTs could support the development of new avenues for property ownership with trustless property titles. NFTs can also solve the setbacks associated with property transfer in traditional real estate.

For example, a European startup, Propy, offers a transaction platform for NFTs bearing access to paperwork for ownership transfer.

Gaming

The use of NFT in gaming has also been one of the prominent highlights of the NFT ecosystem. While online games have items that you can buy and sell for money, the items are under the control of the centralized game server.

However, the introduction of play-to-earn games has transformed the concept of gaming.

Players can participate in the NFT games to earn items, which they can sell on marketplaces at higher prices. Axie Infinity is a glaring example of using NFTs in a game.

Sports

Another important entry among NFT use cases that you should not miss is sports NFTs. Sports collectibles fit naturally with the use cases of NFTs, and NBA Top Shot has developed on the same foundation.

The platform allows users to collect officially licensed video highlights as NFT.

Digital Art

NFTs are a stepping stone for the development of digital arts. With NFT, artists can create programmable arts.

Creators can program their art pieces to change or act differently based on certain conditions. The buyer can verify the authenticity of a digital art before buying it.

Creative theft is a major issue, and digital artists can fight against this issue by using NFTs to present their work.

Fashion

The Fashion industry can utilize use cases of NFTs to facilitate their product provenance process. There is a persistent duplication issue with luxury items, and many users buying from a third-party seller don’t have any way of knowing whether the product is authentic or not. NFT can help to reduce the counterfeiting issues by offering solid proof of authenticity to the buyers.

Fashion companies can also offer tokens for the bought goods which can be sold on NFT marketplaces.

Certifications and Licenses

NFTs can help companies verify certifications and licenses using blockchain technology. 

Tokenizing institutional certifications or educational degrees can help public or private companies verify the documentation before hiring an employee.

Other licenses like business licenses, gun licenses, driving licenses, etc., can also be tokenized and brought under the radar of blockchain.

Entertainment

Musicians or entertainers can tokenize their content using NFT. Musicians can distribute their music with full rights to their creations. 

Creating a transparent system for the royalties will still require the help of media platforms and music labels. 

Entertainers can also auction their work to fans creating more fan engagement without needing any third party. This will help small-time artists to be finally recognized and have a good source of income.

Ethereum Name Service and Domain Name

Domain names are a great example of NFT use cases. Domain names are unique in nature, and tokenizing them will increase their liquidity. 

Unstoppable domains or Ethereum Name Service (ENS) offers blockchain-based domains, and these are available as NFTs. 

Blockchain domains can help companies enter the blockchain ecosystem and get access to the benefits. In NFT marketplaces, users can also trade their domain names, which creates more liquidity for this niche.

It is also important to know how to access, use and manage your NFTs. How can you do that? The answer would take you towards the next chapter of this eBook, focused on NFT marketplaces and wallets.

NFT Marketplaces

Now that you know about NFTs and why they are in the rage right now, it is quite reasonable to harbor intentions about participating in the NFT space. 

What is the best answer for you to capitalize on the immense potential associated with NFTs? This is where you would need an NFT marketplace. 

The basic purpose of NFT marketplaces is to provide a gateway for users to purchase and sell the new category of digital assets.

How Can I Choose NFT Marketplaces?

When you want to find out how to use NFTs, the choice of an NFT marketplace becomes an imperative requirement. Non fungible token provides representation for ownership of an asset.

You can decide on the type of digital asset you want to purchase, sell or create, and this is quite critical before you choose a specific marketplace. 

You can tokenize anything digital, starting from collector’s items to written documents on a blockchain. Therefore, you should narrow down your interest in NFTs to the ideal marketplace for accessing non fungible tokens.

You can also define the selection of the marketplace on the basis of supported NFT types.

With all these considerations in the right place, you can easily move to the next step of creating your account on the NFT marketplace. However, you would come across the need for a blockchain wallet in order to participate in the activities on the marketplace.

If you want to buy some NFTs on a marketplace, you need the required crypto or tokens for the same.

Similarly, you would also receive payments in crypto or other tokens for selling NFTs on the marketplaces. In both cases, you can clearly notice the need for a wallet to store the crypto and tokens required for NFT transactions. 

Just link your wallet with the NFT marketplace, and you are ready to enter the vast world of NFTs.

Best NFT Marketplaces

While we are discussing NFT marketplaces, it is imperative to bring the top marketplaces into the equation. Let us take a look at the top NFT marketplaces in the market right now.

OpenSea

The topper in NFT sales right now is OpenSea. It has a wide assortment of digital assets on the platform, which offers a free signup facility. 

The platform also supports creators and artists with an easy process for creating NFTs or NFT minting. An interesting term indeed, isn’t it? 

We will discuss it in the next chapter! As of now, OpenSea supports over 150 unique payment tokens and serves as a great place for NFT beginners.

Rarible

The next important addition among NFT marketplaces would be Rarible. It offers a massive marketplace for different types of NFTs, with promising similarities to OpenSea. Rarible is a credible platform for selling, purchasing, and creating art, collectibles, music, and videos on the platform. 

However, you have to use the native token of Rarible, RARI, for purchasing and selling on the marketplace. The collaboration of Rarible with notable names such as Adobe and Taco Bell speaks a lot for its credibility as an NFT marketplace.

Nifty Gateway

Another favorable choice of an NFT marketplace would include Nifty Gateway. Here, users can buy and sell music, sports cards, game items, etc. This marketplace collaborates with various top artists and offers limited edition NFTs.

Nifty supports MetaMask wallet, and the user will need to pay via their debit or credit card or via Ethereum. The platform also offers commissions to the creators.

Best NFT Wallets

After learning about the top NFT marketplaces that can help you enter the world of NFTs, it is also important to find the best choices of wallets that you can use for storing your NFTs. The best NFT wallets right now would bring the following names to mind.

Trust Wallet

Trust wallet is one of the most secured crypto wallets that offers to buy, store, exchange, and earn cryptocurrencies. At this moment, this wallet supports more than 40 blockchain platforms and 160k+ digital assets. It also supports storing ERC-721 and ERC-1155 tokens. Users can use Trust wallet in OpenSea and Rarible marketplaces.

Metamask

The all-around wallet for anything related to Ethereum is Metamask. It allows storage of ETH tokens, ERC-721, and ERC-20 tokens. The foremost advantage of Metamask points to the ease of interfacing with popular NFT marketplaces such as Rarible and OpenSea.

How to create, Buy and sell NFT

How to Create NFT

The first thing you need to note about creating an NFT is that it is a simple and straightforward process. The creator should choose the blockchain they want for issuing their NFTs. 

One of the obvious choices for minting NFTs right now is Ethereum, especially for its popularity. In addition, many other blockchain networks are also offering reliable prospects for creating NFTs. 

For example, Binance Smart Chain, Cosmos, Tron, Polkadot, and Tezos are some blockchain networks that have been gaining momentum in the NFT market recently.

All the blockchain networks for creating NFTs have their own token standards, marketplaces, and wallet services. You would need the following things to create NFTs or the NFT minting procedure:

  • Ethereum wallet with ERC-721 compatibilities such as Enjin, Coinbase Wallet, or Metamask.
  • ETH tokens worth almost $50-$100 that you can purchase from exchanges such as Coinbase in exchange for fiat currency.
  • The next thing you need for creating the NFT is a marketplace.

Wait, haven’t we been through this marketplace and wallets thing before? The thing is, we didn’t reflect on how to use the NFT marketplace or wallets we discussed in previous chapters. Let us assume that you want to create an NFT art. 

You can find many marketplaces that help you connect your wallets and upload the images you want to convert to NFTs.

The notable NFT marketplaces, as we discussed before, such as OpenSea and Rarible, are great picks for creating NFTs. 

You can discover a “create” button dedicated to NFT minting on these marketplaces, thereby making your work easier. 

Here is an example of the steps you need to follow on OpenSea for creating NFT art.

  1. Click on the “create” button in the upper-right corner of the OpenSea application.
  2. You would have to connect to an Ethereum-based wallet with the prompt on the next screen.
  3. Enter the wallet password and connect to the NFT marketplace.
  4. Just hover over the “create” button and find “my collections.”
  5. After clicking on the “my collections”, you have to tap the blue “create” button.
  6. Then, you can upload the image and add your name alongside writing a description.
  7. Assign an image for your collection, which would be visible on the left side of the screen. Add a banner image by choosing the pencil icon available on the top right.
  8. You are ready to create an NFT now by just clicking on “Add New Item” alongside signing a message with the wallet. Then, you will find a new window for uploading the image to convert it to an NFT.
  9. Once you are done, just click on “create” at the bottom of the page, and you can complete the NFT minting process.

How to Buy and sell NFT

With the new knowledge you acquired about creating NFT tokens, you would look for information on how to buy and sell NFTs. 

You can purchase NFTs on marketplaces with crypto tokens or fiat currency, as in auctions. After purchasing an NFT, you have the final word about selling or holding to the NFT. You can sell an NFT by listing the token on a specific marketplace.

Just click on the NFT you want to sell in your collection in the wallet. Find the “sell” button and click on it to find a pricing page.  Set the terms of the sale on the pricing page, with options of choosing from an auction or fixed price sales. Generally, you would receive payments for NFTs in the form of ERC-20 tokens or ETH tokens.

Creators can also choose to add the option of royalties to their NFTs, which can help them fetch a share of earnings from future sales of their NFTs.

The future of NFT

The final statement about non fungible tokens NFT would draw a fine line of balance between what NFTs are, and what they can be. You need to understand that digital assets are still a cause of concern for many, especially considering the environment they are in. Anything digital is volatile and could disappear in the blink of an eye.

They are a new class of digital assets with the potential for transforming ownership as we know it. However, we can definitely say that NFTs, DeFi and Metaverse will play a vital role in the upcoming future. Start discovering more about NFTs with comprehensive learning materials and explore your possibilities in this new world.

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