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Non-Fungible Tokens (NFTs) and Your Business

 


What’s a Non-fungible Token?


To understand Non-Fungible Token Development Services, let’s start with a fungible token. A fungible token is a digital asset. It’s secured by blockchain technology, and it’s interchangeable. Bitcoin is a well-known fungible token. One Bitcoin is equal in value to any other Bitcoin. In contrast, a non-fungible token is unique. One NFT is not equal in value to any other NFT.


NFTs don't have traditional value; they are worth what someone is willing to pay.


NFTs don’t have a traditional value associated with them. They are worth what someone is willing to pay. And they are uniquely coded so that they can’t be replicated. NFTs are also secured by blockchain technology. One way to see the difference is in the tokens used: ERC-20 for cryptocurrencies and ERC-721 for NFTs — but more on that later.


NFT Use cases


We can further understand NFTs by learning about some of the current use cases for NFTs and tokenizing assets. Below are areas where the ownership of NFTs guarantees your unique ownership of a variety of assets, from gaming and digital art to fantasy sports applications. Blockchain opened up the collectible marketplace to more security and digital scarcity; only time will tell how much it will also grow within the gaming ecosystem and other industries.


  • Crypto Kitties


The internet and cats go together like bread and butter, so it’s not surprising that the popular use of NFTs involves cats on the internet.


  • Cryptopunks


Larva Labs created Cryptopunks in 2017, which consisted of 10,000 unique characters distributed for free.


  • Sorare


Fantasy sports is a massive online market. NFTs have jumped into the fantasy sports market with Sorare, where you can purchase licensed football (soccer)


cards, each one backed by an ERC-721 token.


NFT Marketplaces


All three of the examples above are platforms built specifically around NFT Marketplace Development. A lot of other NFT action happens in marketplaces like Rarible, OpenSea, SuperRare, and the invite-only Nifty Gateway.


Do NFTs Matter for Businesses?


As NFTs become mainstream, they’re selling for more money. Does this new digital asset matter for your business?


It depends.


Business applications are still evolving. The obvious industries to get involved with NFTs are music, artists, game designers, and collectors. Creators have an opportunity to receive more direct payments and simply make more money.


But other companies are finding unique ways to use NFTs, and their uses are likely to grow. There’s a possibility that non-fungible tokens could expand to tokenize more real-world assets such as transactions, contracts, and even real estate. Some of this has already started. Additionally, NFTs can create a way for your business to make an impact on your brand through unique experiences, and increase both awareness and interest.


How To Make An NFT


If you want your company to join the NFT experience, you'll start by “minting” something. Perhaps you have your own great set of GIFs. To create an NFT for each GIF you'll need a unique ID, a name and description, and a place to host each image file online, most likely using the InterPlanetary File System. It might not sound too complicated, and you can find the code online necessary for setting up the NFT, but there’s a cost involved.


Risks of NFTs


The biggest risk with NFTs is speculation. The money for some of the mentioned NFT examples looks impressive; that’s why they make the news. But even the expensive Beeple purchase is only worth what someone else is willing to pay, so perhaps the buyer who put down $69 million could never find someone else willing to pay that high. NFTs are speculative assets, so their value will rise and fall in price.


"Even with the security of blockchain, there are risks to consider with any digital asset."


NFT Security

Here are some tips to stay as secure as possible:


  • Use a hardware wallet — don’t just use a web-based wallet, such as Metamask, on its own.
  • Set up two-factor authentication.
  • Make sure you use the correct website, & beware of phishing scams.
  • Never share your private keys with anyone.
  • Do your due diligence that the NFT seller is legitimate.
  • Do your due diligence that the asset is actually owned by the seller.


You Can Break Down an NFT into Two Sections:


  • Blockchain:


Handles the minting and bookkeeping of NFT and makes sure that the metadata of the NFT is immutable and secure by replicating it across thousands of computers/nodes around the world.


  • NFT data:


This is the asset. The majority of the NFT data must be stored off-chain but must be secured also, such as using IPFS, as mentioned above.


Some of the most popular and required-after items on the blockchain are the NFT (non-fungible tokens). NFTs are created by artists, musicians, writers, and other creative people. They make products more unique and interesting. In this article, we covered the different NFT business opportunities to consider.


To know more, contact us at: https://www.codezeros.com/contact


 

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