So..What is All the Hype about?
If you are not living under a rock, you have definitely heard of NFT. Just to give you a little idea about the level of buzz around NFTs, let me say that this👇 was sold for Nearly $69 million.
This digital art work by American artist Mike Winkelmann, better known by his artist name Beeple was auctioned by Christie’s at a standalone online auction, which took place from February 25 to March 11,2021.
What Exactly is an NFT?
If you google about it's definition you will most likely find something like this
A non-fungible token is a non-interchangeable unit of data stored on a blockchain, a form of digital ledger, that can be sold and traded. Types of NFT data units may be associated with digital files such as photos, videos, and audio.
NFTs are simply a certificate of Authenticity. They're bought and sold online, and represent a digital proof of ownership of any given item. NFTs are securely recorded on a blockchain.
Let's break it down and simplify it a bit and Let's understand this with a quite fascinating & not-so-boring example.
Artist Maurizio Cattelan duct taped a banana to a wall, titled it “Comedian”, and sold 5 editions of the artwork for nearly $150,000 each in Art Basel Miami Beach exhibition.
Now, what's so great about a duct taped banana and why is it valued so much?
It's not just any other regular duct-taped banana ,it is a CERTIFIED DUCT-TAPED BANANA. It is valuable because of it's scarcity. (Almost)Anyone can tape a banana to a wall, but can't produce certificate to prove that it is the "Comedian" and it is created by Maurizio Cattelan.Now you can understand why the jokes and memes about taking screen-shots of NFTs are not-so logical.
NFT works on blockchain as it gives users complete ownership of a digital asset. For instance, if you’re a sketch artist, and if you convert your digital asset to an NFT, what you get is proof of ownership, powered by Blockchain.
Let's say Maurizio Cattelan. wanted to create a collection of 5 of his art work where each one is a digital drawing, like a JPEG file.
Maurizio would need his own smart contract
He'd give each piece of artwork a unique identifier (ex. Sketch #1, Sketch #2, Sketch #3, etc).
Then, when Maurizio is ready to launch his NFT collection he would launch it using his own Ethereum wallet to sign✍️ the NFT collection. When he's ready, he'll put it on the public blockchain — where everyone can publicly see Maurizio NFT collection.
Then, when Maurizio wants to sell one of the NFTs all he needs to do is transfer the NFT over to the person who bought it using the buyer's public wallet address.💵
The person who bought the NFT will be happy because they got a one-of-a-kind, From Maurizio Cattelan himself!
How? The buyer can prove that the NFT collection was originally signed and created by Maurizio Cattelan himself because the NFT would show that it came from a smart contract signed by Maurizio Cattelan.Maurizio Cattelan signed the collection with his public address! Usually, artists publicly announce their wallet address so no one can pretend to be them!
The buyer can prove that the NFT itself is a unique Maurizio Cattelan sketch from the collection because each NFT from the collection has a unique identifier (ex. Sketch #1, Sketch #2, Sketch #3, etc) that comes from the person who originally created the collection.
Now ,I hope you understand(atleast a little bit) what NFTs actually are.Feel free to correct me if I've written something wrong.I'm a beginner in this field myself:)
Credits
I stole the content from various places👀 but the biggest chunks were taken from this Video and Repo.God I'm so shameless.