A Brief Overview of NFT in 2 Minutes

Appeared since 2014, NFT is still being noticed by the crypto community when recently most e-newspaper and tweets constantly mention the robust growth of the NFT market. According to stats, the transaction volume of the NFT market reached at least 44.2 billion USD in 2021, while the figure for 2020 was only about 106.5 million USD and 15.2 million USD in 2019. Before finding out why NFT has grown and become the trend as today, let's have a quick look at the overview of what NFT is.

General View on NFT

NFT stands for Non-Fungible Token, which is a digital asset stored on the Blockchain ledger. NFT represents virtual assets or can also be encrypted from real-world objects like art, music, in-game items, and videos.

Fundamentally NFT is a token, it is generally built using the same kind of programming as cryptocurrency, like Bitcoin or Ethereum, but cryptocurrencies are 'fungible'. This means that cryptocurrencies can be traded or exchanged for one another. NFTs are different. Each has a unique code so they cannot be exchanged at equivalency.

Key Characteristics of NFT

Uniqueness

Each NFT has its own unique identifier and this sequence of codes cannot be altered or duplicated so no one could fake. This shows its uniqueness.

Transparency

Data is stored in a decentralized, public, and immutable Blockchain, so anyone can access all relevant information about the origin, purchase history, as well as the owner of the NFT.

Indivisibility

Unlike other cryptocurrencies, NFT cannot be broken down to be transacted as fractions like BTC, ETH, or DAI, etc.

Ownership

Ownership or authorship are both verifiable based on data stored in the Blockchain ledger. Creators can retain ownership of their work and claim royalties when the work is resold.

Scarcity

An NFT work is a unique edition so the limited quantity has boosted its value.

The Development of NFT

NFT appeared in 2014 but it was not until 2021 that the whole world saw its explosive growth along with deals worth up to million of dollars. Typically, the NFT work 'Everydays: the First 500 Days' was sold for $69.9 million. Another event in May this year proved the heat of this field, during the official sale of Otherdeed NFT Land of the Metaverse Otherside project on Ethereum, the number of participants competing to own this NFT was so large that it Gas fees are pushed up, users have to pay several thousand dollars per transaction.

Lately, the NFT market is receiving a lot of attention form big names in many different fields such as Pepsico, Adidas, Nike,  Gucci, or most recently, the cooperation event between Binance and football legend Ronaldo to release the NFT collection that received a lot of positive feedback from the public.

To summarize, the fields related to Blockchain technology are gradually asserting their position in the global trend. Metaverse is appreciated as potential growth for the future. Thus, going along with it is the development of 'Non-Fungible Tokens'. Metaverse and NFT projects promise to bring many benefits and applications to the community in the future.