To start, what do you already know about a non-fungible asset? Perhaps you think it is similar to cryptocurrencies. And from the word “fungibility,” it is not interchangeable, eh?
If that’s what you think, then you’re right.
However, non-fungible assets are much more than just their “non-fungibility,” really. They are a whole world of investment opportunities that you’d better start exploring. And while the word might seem new, “non-fungible assets” are not entirely a strange concept.
So, what are these gold mines?
What should you know?
What are non-fungible assets?
This post has the answers. Here, you will find details on:
- What non-fungible assets entail and how the hype started.
- From there, we will establish the similarities these digital assets share with Ethereum.
Understanding Non-fungible Assets: What Do They Entail?
What Is The Hype On About?
Non-fungible assets, also known as Non-fungible tokens – NFTs, are not entirely a new craze. These digital assets have been around since 2014 but have only gained explosive growth recently. As such, it is pardonable if you don’t know about NFTs.
Like you, the majority wouldn’t know about NFTs if not for the stories of their benefactors. And one of such is Dorsey of Twitter, but even his yields didn’t come close to Beeple’s. Beeple, also Mike Winklemann, recorded $69.3M from the sales of his digital art pieces. And his monumental achievement brews the hype that catapulted NFTs as we know it.
Beyond Dorsey and Beeple, other people have also benefited from the NFT wave. So much so that NFTs have accrued over $170M in transactions since late 2017.
Now, those landmarks undoubtedly show that NFTs are worth the hype. But then, that leaves you with more questions. And the first, and perhaps the most important, of the questions, is, what are NFTs?
If people are investing their hard-earned money, what do the assets do? What are non-fungible tokens?
What Are NFTs?
Non-fungible tokens are digital assets that take the form of both tangible and intangible objects that you can buy or sell online. They work similarly to cryptocurrency, especially Ethereum, as they store their transactions on blockchain technology.
However, NFTs, from their non-fungibility nature, are not interchangeable. In other words, an NFT doesn’t translate to another in terms of value.
In simple terms, NFTs let you create a stream of income from your wares. With one, you can tokenize your digital items and have sole ownership with a unique data set. Even better, you can set scarcity for your wares and explore a future of re-sale proceedings from them.
The best part: you can use NFTs for virtually anything: starting from arts, in-game items, to even real estate. And say you no longer need the collections, you can transfer your ownership via the secured Ethereum blockchain.
So, does that mean NFT and Ethereum are the same? If not, what is the relationship between the two?
NFTs And Ethereum: Are They The Same?
NFTs and Ethereum share the same blockchain technology. Besides, the latter makes it possible for the former to work. Even at that, they are not the same term.
The perfect explanation will be that Ethereum hosts the activities of NFTs. How?
- First, Ethereum provides the security to ensure NFTs transactions are safe
- And even before safety, Ethereum makes it possible for users to trade their tokens. Thanks to its backend.
- Lastly, and more importantly, Ethereum is always online. For that reason, NFTs are always available and accessible.
And that’s it, the base knowledge you need about non-fungible assets. Perhaps you need more information; check our resources on similar topics.